DISTRIBUTION OF GENERAL MEDICAL SERVICES

HC Deb 27 June 1990 vol 175 cc395-444

Lord's amendment: No. 21, in page 23, line 10, after "specify" insert "(a)".

Mr. Dorrell

I beg to move, That this House doth agree with the Lords in the said amendment.

Mr. Deputy Speaker

With this, it will be convenient to consider Lords amendments 22 to 34 and 59 to 68.

Mr. Dorrell

The amendments primarily reflect the outcome of discussions with the medical practices committees about the practical implications of our proposals on GP manpower, job-related GP appeals and part-time working by GPs. They therefore address the management issues relating to general practice.

The first group of amendments deals with GP manpower. We made it clear in the White Paper that we intended to take two additional powers to improve our ability to manage the number of GPs practising within the GP service. The relevant paragraph of the White Paper, paragraph 722, commits the Government unreservedly to ensuring that there is adequate access to family doctors across the country. It also says that it is a legitimate concern of the Government to ensure that there is a proper balance in the number of doctors as between the hospital service and general practice.

In order to give practical effect to those policy aspirations, the Government announced that they intended to take two further steps to enable it better to control the total cost of the NHS. We announced that we intended to seek reserve powers to control, if necessary, the number of GPs entering into contracts with the NHS. We also said that we would seek in due course to reduce from 70 to 65 the retirement age for GPs.

The amendments address the first issue, the total ceiling on GP manpower. We now accept that we should define the reserve powers to control GP numbers as applying nationally, not area by area. There was some concern that the powers could not be made to work effectively and deliver the results that we wanted if we sought to exercise the power to control total GP numbers at any level below the national level. The amendments provide us with the power to impose that total limit on GP numbers at national level. Separate limits may apply in England and Wales. Clause 38 provides that separate limits can apply in Scotland.

The second of the management issues that is addressed by this group of amendments deals with appeals. We had intended that the two medical practices committees should consider appeals on points of law by GPs against decisions by the family health service authorities in England and the health boards in Scotland. However, the committee doubted whether it would be practical for it to deal satisfactorily with appeals from GPs on points of law. Therefore, we have accepted the argument that the appeals process should continue to be directed to the Secretary of State rather than to individual family health service authorities.

This group of amendments also clarifies the provisions relating to part-time working and job sharing by GPs. It builds on the major innovation that was announced in the White Paper and introduced into the Bill on Report in this House. We have made it clear that all GPs will need to be admitted to the medical list on either a part-time or full-time basis. GPs can appeal to the Secretary of State against decisions by the medical practices committees to refuse to vary the conditions on which they were admitted to the medical list. GPs already working part-time under locally agreed arrangements will be transferred automatically to the new scheme. Their position will therefore be fully safeguarded.

The amendments improve the provisions in the Bill for the management of general practice, to the benefit of both GPs and their patients. I commend them to the House.

Question put and agreed to.

Lords amendments Nos. 22 to 69 agreed to, some with Special Entry.

Lords amendment: No. 70, before clause 40, insert the following new clause— .—(1) The Secretary of State shall, with the approval of the Treasury, make grants out of money provided by Parliament towards the expenses of local authorities incurred in connection with the exercise of their community care functions. (2) Grants made in accordance with subsection (1) above shall be used by local authorities solely for the provision of community care for purposes described in plans drawn up in accordance with section 44 below. (3) The Secretary of State shall not later than 30th November in the year preceding any financial year lay before Parliament his estimate of the total amount of grant likely to be disbursed under this section in respect of that financial year, together with a statement of the sums requested by local authorities and the formula for distribution between such authorities, and shall at that time publish forecasts for the following two financial years.

Amendment proposed: (a), after subsection (2), at end insert— (2A) The Secretary of State shall by regulation make a scheme whereby local authorities may make payments to disabled persons or other persons in receipt of community care services for the purchase of care or personal assistance services, subject to subsection (2B) below. (2B) For the purpose of the scheme made under subsection (2A) above, section 29(6) of the National Assistance Act 1948 shall not apply. (2C) The Secretary of State shall issue guidance to local authorities in association with the scheme made under subsection (2A) above, for the purpose of assisting them in ensuring that any payment made by them under the scheme are subject to arrangements sufficient to ensure that the authorities have satisfied their fiduciary duties..—[Mr. Rowe.]

Mr. Deputy Speaker

With this it will be convenient to take the Government motion to disagree with the Lords in the said amendment, and Government amendments (b) and (c) in lieu of the Lords amendment.

9 pm

Mr. Kenneth Clarke

I should explain to the House that, although the amendment is unacceptable, the Government, recognising the widespread concern about the subject, have tabled an amendment to clause 47 that would enable me and future Secretaries of State to make grants to voluntary organisations to assist them with the expense of providing services to people who are over-dependent on drugs and alcohol.

Lords amendment No. 70 touches on ring fencing and the arguments that we have had during the passage of the Bill about whether grants made by central Government towards the costs of the new care-in-the-community responsibilities that will be placed on local authorities should somehow be ring fenced.

Before we plunge into the intricacies of local government finance, which I shall try to avoid but which are almost unavoidable, we should at least touch base. We are talking about a policy which is certainly the most popular that I ever put forward and which has received widespread support—the policy of making clearer the responsibilities for care given in the community to elderly, disabled, mentally ill and mentally handicapped people. The policy was based on the second Griffiths' report on this subject.

In future, local authorities will have new resources and responsibilities to make an individual assessment in the case of each citizen who may need support to live in a non-institutional, non-NHS setting, and to reach a judgment about how best to provide services, within the resources available, and to support those people, and the families and friends who help to care for them, in achieving the best possible quality of life in or near their own homes.

We have had many arguments about the subject. At one point, I was accused of going too slowly in my response to the Griffiths report. Then I was accused of going too quickly—of rushing to include proposals in the Bill after a short period of consultation. But at no stage has anyone seriously challenged the desirability of that policy, and we are now talking about its implementation. The Government have always made it clear that, when the new policy is introduced, adequate resources should be available to enable the local authorities to put the framework in place and to begin the process of steadily raising the quality of care in the community to the level which I am sure people will expect such services to reach by the end of the decade.

The obvious source of finance is the transfer, by agreement, of money from the budget of my right hon. Friend the Secretary of State for Social Security—away from the present arrangements which give open-ended access to income support to those who go into residential care homes—across to local government, as an added contribution to central Government grant, to enable it to finance the individual assessment of its provision of care in residential care homes or by way of domiciliary provision. We have always said that we shall not only transfer what the Department of Social Security is spending at the time of the transfer but will anticipate the growth in the social security budget and make reasonable assumptions about the direction in which demography and the desire to expand services are likely to take local authorities.

There is no doubt that the Government have embarked on a policy that is popular and widely accepted in the field. We have also undertaken that, when the policy is introduced, extra resources will be transferred to the local authorities in the manner that I have described.

The result is that, although Lords amendment No. 70 is very important—I have no doubt that there will be controversy about it in the House—we are arguing not about the wood but about one of the trees. In my opinion, exactly what we mean by ring fencing and by this particular intricacy of local government finance remains somewhat obscure to those who think that they have views on the subject. In the minds of some, ring fencing has acquired a symbolic quality. They have heard that rather nice people are in favour of ring fencing and have concluded that, if the Government oppose ring fencing, there must be some doubt about the Government's commitment to our own policy or about our commitment that the local authorities will have the resources to implement that policy.

Mr. Ieuan Wyn Jones (Ynys Môn)

Does the Secretary of State agree with Sir Roy Griffiths's definition of ring fencing in the White Paper?

Mr. Clarke

I agree with the definition, but I do not agree with Sir Roy Griffiths's proposal—and nor do the amendments exactly reflect those proposals. In his report to the Government, Sir Roy advocated specific grant as a mechanism for transferring funds. I must admit that I do not have his report instantly to hand, but I have obviously discussed it frequently with him. He regarded specific grant as a mechanism whereby central Government could control local government expenditure on the subject, and central Government could exercise influence over the provision of care by local authorities.

I cannot speak for Sir Roy, but I think that he adheres to many of his proposals. I work closely with him, because he is deputy chairman of the NHS policy board, and, indeed, was at a board meeting with me this afternoon. His suggestion was that each care plan produced by local government should come to central Government, and that money be released through specific grant when the Government are satisfied with the plans provided.

We did not go along with that proposal—I do not believe that it is practicable. It would involve me and my Department taking on a great obligation and having people to vet community care plans before distributing money. I do not want officials in my Department second-guessing what local authorities are doing. It is unreal to imagine that we can get that degree of control over local government. I also do not think that it is much of a sanction to threaten that we shall not release money to Hackney until we are satisfied that Hackney's plans are all right. It would not work like that. For that reason, we have moved away from Sir Roy's proposal.

Various other forms of ring fencing are kicking about. Some people solemnly suggest that we should have a specific grant that specifies the maximum to be spent by local government on the policy, keeping rigid control in the hands of central Government. The Lords amendment envisages a minimum, with local government finding other money from elsewhere, principally the community charge, on top of the ring-fenced sum for the new money to be added. Although I accept that it is not a million miles from Sir Roy Griffiths's proposal, Lords amendment No. 70 does not represent the Griffiths report, any more than the Government's version does.

Mr. Tom Clarke

The Secretary of State says that the amendment does not necessarily reflect precisely Sir Roy's recommendation. Conversely, will the Secretary of State confirm that Sir Roy has publicly supported the Lords amendment?

Mr. Kenneth Clarke

I did not know that he had done that, but I have made it clear—I have had fairly regular contacts with Sir Roy Griffiths—that I think that he is still attracted by the idea of a specific grant. However, he also understands that, after considering the point, the Government decided that it was not appropriate. I tried to give the reasons why, at an early stage, we turned from that part of Sir Roy's otherwise excellent report from which we extracted the main points of policy that we have been following.

Sir David Price (Eastleigh)

Is my right hon. and learned Friend aware that, in the Select Committee report, we offered him five variations of ring-fencing specific grants, from which he may take his choice?

Mr. Clarke

Perhaps I should return to why I do not like any specific grants of the kind that have been described for all the new responsibilities and care in the community.

Sir Michael McNair-Wilson (Newbury)

Will my right hon. and learned Friend give way?

Mr. Clarke

I shall give way once more and then I must deal with the general case.

Sir Michael McNair-Wilson

Does my right hon. and learned Friend agree that the danger with ring fencing is that it can become restrictive and therefore deny essential flexibility?

Mr. Clarke

I am grateful to my hon. Friend, and I am sure that that is the case. The people in another place who supported amendment on ring fencing—quite a number of my hon. Friends and some Opposition members are urging it now—believe that it would be a useful mechanism to put a lever on the Government to put up the amount of money that we spend. That is good in a good year. However, it would give the Government every opportunity again to identify to other parts of the local government system the restraints that they want to impose on the growth of care in the community in future years. I am not sure that the short-term reasons that attract people to that arrangementat the moment are likely to be good and lasting for all time. It is a double-edged sword which some directors of social services are asking us to wield in their budgets.

My starting point is what the policy is. We are clearly giving local authorities responsibility for policy, and they should expect to be accountable for it. Responsibility involves a range of activities, such as assessing individual clients, and arranging for care. As in all social policy, that involves a local authority taking on board the choice of priorities, deciding what can be afforded for certain clients and the emphasis that it wants to give, and deciding what priority to give to that part of its policies as against other parts of its social services provision. Those in responsibility cannot make judgments about finance in different parts—

Mr. Nicholas Winterton

Will my right hon. and learned Friend give way?

Mr. Clarke

I shall give way later, because if I am not careful I shall make a long speech.

Those in local government are accountable to their electorate for all local government services. It is artificial to extract accountability for part of its services.

It is a mistake for the House and the Government to believe that somehow we can transfer responsibility to local government but retain the ability to make key judgments about what proportion of the social services budget should be spent on community care. All the history of central Government trying to do that with local government shows that it is unworkable.

The Association of County Councils is against ring fencing. Many people in local government remember when far more local government money came from specific grants on which Parliament and Government insisted. They felt hog-tied in their choice of priorities.

Following that path would sit curiously with the other provision that we give local government. A case for ring fencing could be made for every aspect of local government policy. The Department of Health steered the Children Bill through the House last year. Hon. Members who served on the Standing Committee and those who took part in debates in the other place were enthusiastic about raising the standard of local authority care for children. In the light of what has happened this year, I am convinced that, if they had thought of ring fencing, all those enthusiasts, including Conservative Back Benchers, would have tabled an amendment to ring-fence the money for local authority provision under the Children Act 1989, which will become a new obligation on local authorities in October next year.

Some hon. Members take part in education debates. The House would be full of enthusiasts for ring fencing education grants. In recent years, there has been a growth in specific grants for education, which, by and large, are resented by education authorities, although the small grants tend to be fairly desirable. We cannot return to a system whereby, when the House is dealing with a new subject, we suddenly invent a new separate and specific grant for a part of local authorities's responsibilities.

Mr. Hind

Many Conservative Members are concerned that my right hon. and learned Friend should answer the criticism that was made by the directors of social services in their response to the Griffiths report, in which they bluntly said that they were concerned that certain local authorities would spend the community care budget on filling holes in the road. That is what started the ring-fencing argument.

Mr. Clarke

I accept what my hon. Friend says. Many of the people who are arguing for ring fencing believe that. I have given the general case against it, which is why we should not go down this route as a response to those fears.

I do not believe that those fears are real. Every director of a local government service would like his budget to be protected while he retains the ability to raid other people's. The person in charge of transport would love to have his budget ring-fenced and to be a predator on other budgets, and the same applies to directors of education and social services. Since we have made block grants to local government, it has been much more free to choose between one service and another. All the experience shows that social services do not lose under block grants. Year in and year out, the expenditure of most local authorities on social services tends to exceed that set down as the norm by Government under the grant-related expenditure assessment or the standard spending assessment and the money comes from other services such as transport, which is a frequent loser. There is nothing to suggest that social services have suffered predation by local authorities for the sake of other calls on their budget.

Mr. Jack Ashley (Stoke-on-Trent, South)

rose—

9.15 pm

Mr. Nicholas Winterton

I am sure that my right hon. and learned Friend is aware that the block grant was introduced by our right hon. Friend the Member for Henley (Mr. Heseltine) and our hon. Friend the Member for Bury St. Edmunds (Sir E. Griffiths) under a previous Conservative Government and that there is considerable support, even on the Government side, for the reintroduction of a specific grant, not least from our hon. Friend the Member for Bury St. Edmunds.

Does my right hon. and learned Friend agree that the Government are handing over to local government considerable responsibility for vulnerable groups? Will he share with the House his concern that if local government were capped even more than in this financial year, as it could well be, those vulnerable groups who cannot represent themselves—the mentally ill, the mentally handicapped, the elderly and the disabled—could be disadvantaged because money allocated in the standard spending assessment by the Government for community care may not all be spent on community care, but may be spent on more desirable, romantic sectors of local government expenditure?

Mr. Clarke

Obviously, my first answer is the one that I have just given. Experience of local government tends to show strongly that social services do not lose out to other services. It tends to be the other way round, because most local authorities of whatever political complexion tend to share my hon. Friend's concern for these groups. Local authorities tend to protect spending on those groups rather than on other parts of the budget, such as holes in the road, which in past periods of local government restraint have obviously not rated highly in the priorities.

I shall return to my hon. Friend's argument having dealt with my final practical point. I am still unclear about how the advocates of ring fencing think that they would ring-fence an identifiable block of work. Local government already has care in the community responsibilities. All our social services authorities provide home helps, meals on wheels, respite care and many other services to people in the community. A new responsibility is now being added.

There would be appalling problems in trying to define exactly the subject matter of the community care block grant. In particular, one would have to decide where to put the line between this and the rest of the social services budget. There are endless practical cases where a particular client, to use the social worker word, is not in the category labelled "care in the community client" rather than "other social services client". The work is blurred at the edges, so definition would be difficult.

The amendment leaves to the Secretary of State and his Department the other simple task of deciding on a formula to distribute the money, and so on. The amendment has practical problems.

My hon. Friend the Member for Macclesfield (Mr. Winterton) and many other right hon. and hon. Members are worried that without ring fencing we could leave vulnerable groups open to possible losses in their budget which we might otherwise avoid. Obviously, we depend mainly on the policy, which is an improvement. The new funds that will be given will pave the way to an expansion of service. Furthermore, other controls are built into the Bill which will enable us to monitor the provision of care.

All local authorities will be required to produce community care plans. They will be required to consult on them with health authorities and others. Therefore, we shall have more opportunity to feed in news about the quality and nature of local authority provision than now. Part of the new policy includes enhanced powers for the social services inspectorate. Therefore, other areas of what I would call, perhaps unsuitably, quality control are being built into the Bill. Inept use of local government grant powers will not be the effective way to look after the standards of provision.

If hon. Members want to return to the old system of distributing money to local government whereby it was given set sums for each task, they should vote for the amendment. The Association of County Councils is against the amendment, and I believe that most of the other local government associations would not be in favour of returning to the old method of giving out money on a service-by-service provision. I believe that we are right not to want to return to the old system. The block grant is an improvement, particularly for matters which are a local government responsibility. For such matters, local government must decide its priorities.

Dame Jill Knight

My right hon. and learned Friend referred to the Children Act 1989. In the light of the Stephanie Fox case which occurred only a week or so ago, does he believe that the money allocated by the House to protect children under the provisions of that Act was sufficient and was used to protect that child? It was the intention of the House that the money should be used in that way.

Mr. Clarke

I hope that my hon. Friend will forgive me if I do not refer to the Stephanie Fox case in detail. My hon. Friend the Minister for Health answered a parliamentary question about that case recently. I do not believe that resources were the key issue in that case, but I should prefer to give a more considered response if the matter is raised in a more structured way on another occasion. I will give way to the right hon. Member for Stoke-on-Trent, South (Mr. Ashley) if he still wants me to.

Mr. Ashley

I thought that the Secretary of State was avoiding me. The Secretary of State argues that if we press for ring fencing for community care, we should logically extend it to education, children and other needs. Will the right hon. and learned Gentleman consider the possibility—I believe that it is a certainty—that those receiving community care are not popular in the sense of receiving a popular allocation? They are not politically popular. As the hon. Member for Macclesfield (Mr. Winterton) said, severely disabled people, and especially mentally disabled people, are not popular. That is why money for them should be ring-fenced. We would not press for general ring fencing.

Mr. Clarke

I hope that I can meet the right hon. Gentleman's point. Some of the people about whom we are talking are, to use his phrase, politically popular. The elderly are popular, as are the disabled who are a powerful lobby, in which the right hon. Gentleman takes an active part. I agree that some local authorities are less inclined to give the correct priority to mentally ill people. I also believe that local authorities are inclined to cut grants to voluntary bodies when they are under budgetary pressures. Drug and alcohol abuse are not always popular recipients of social services money.

The case is made for specific grants, in education, social services and elsewhere on a smaller scale than the amendment contemplates. I am in favour of small specific grants, where we give a block of money to local government to induce it to provide a service which, if it were left to itself, it would be inclined not to provide. From the word go, we have always had a proposal for specific grant for community care services and for mentally ill people.

Some local authorities have a bad record of community care provision for mentally ill people. Some hardly bother with it at all. For that reason, we are introducing a new and particular form of specific grant. The money will be handled on our behalf by the district health authorities which will disburse the money to local authorities as they produce plans which fit in with the health authorities' plans for the discharge of patients from hospitals or the care of patients in the community.

In response to the Lords amendment and to the pressure from all sides on ring fencing, with which I have dealt, we have looked again at the position of people who are dependent on drugs and alcohol and at the work of the voluntary bodies that deal with drug and alcohol abuse. Among others, my hon. Friend the Member for Ealing, Acton (Sir G. Young) referred in Committee to the fear felt by the voluntary organisations about the arrangements that we were proposing for the financing of care in the community. That concern was also raised in another place. Voluntary organisations have expanded their work in recent years, largely on the basis of the current availability of income support at the registered home rates. That is one of the things that we are doing away with. Under the new policy, there will be no access to such income support.

We have all encountered people who work with those with drug and alcohol abuse problems who say that they fear the loss of income support money because they are dependent on the local authorities which might not give them the necessary grants. That is why our amendment proposes that the Secretary of State should be able to make specific grants to local authorities for use in helping voluntary organisations with the services that they provide for people who are dependent on drugs or alcohol. Our amendment refers to persons who are, have been, or are likely to become dependent upon alcohol or drugs". The provisions would enable local authorities to assist with the preventive work that is undertaken by the voluntary organisations, as well as to assist them with the services that they provide for those who are dependent on drugs or alcohol or who are recovering from such dependency.

I hope that, having heard me answer the general case, the House will accept that we have responded to an important point that has been worried away at ever since the Bill was introduced. People have named the voluntary bodies which could envisage the loss of their income support funding and which were dubious about whether their local social services departments would want to continue giving them a grant for their work with, for example, drug abusers. Indeed, as the right hon. Member for Stoke-on-Trent, South said, some local authorities might be tempted to give a pretty low priority to the work of outside agencies for unattractive groups, such as drug abusers.

Therefore, I say to the House—if I was in another place, I should say it to their Lordships—that I hope that those who have worried at that issue will accept that they have won a significant point. Alongside the commitment that we have already given to make specific grants for the services for mentally ill people, we are now putting on the face of the Bill, in primary legislation, a specific provision for grants to voluntary organisations, which the Government will fund. The Government will be accountable for the sum of money that is allocated for that purpose. To use the jargon, that money will be ring-fenced and local authorities will be able to spend it only on grants to such bodies.

Mr. Hinchliffe

The Secretary of State seems to have undermined his central argument against the Lords amendment by making a concession on that point—although I welcome the fact that he has. Like many people outside the House, I am puzzled by why the right hon. and learned Gentleman has conceded on the issue of specific grants for mental illness, but not for mental handicap. I cannot see any logical difference between the two.

Mr. Clarke

I was always in favour of specific grants for mental illness services. I was a strong advocate from the word go, and such provision was always in the policy. If the hon. Gentleman looks at the current provision made by the local authorities, he will find that only 3 per cent. of the total budget is spent on services for mentally ill people. The proportion varies from authority to authority. In some authorities the provision is minuscule. The provision for services for the mentally ill had therefore been given too low a priority.

There is also the problem of liaison with the health authorities themselves. I believe that most hon. Members support modern mental illness policies and accept that there should be smaller institutions and care in the community. However, most of us also accept that that works badly in practice. Indeed, my hon. Friend the Member for Macclesfield is alway pressing me about people who slip through the net and he sometimes attacks the policy. However, he is right to say that we know that, however good that policy may be in theory, it does not work well in practice in the country at large. That is why there is a wholly separate case for a specific grant for mental illness provision.

My proposition is based on the view that where it is reasonable to suppose that certain groups might be unpopular, a small amount of the local government allocation can be ring-fenced in specific grants. That is the way in which we shall induce authorities to spend more than they otherwise would on that part of the provision. It is taking that much too far—I do not think that I have undermined the basic case—to say that a huge block of money, being a high proportion of the money available for care in the community activities, should be ring-fenced and specific grant-based in that way. There is no evidence to suggest that social services have come under pressure from other services under the comparative argument for resources. There is no really sensible way of separating the money with clear borders, from the rest of social services provision.

Going for specific grants of that kind would be to go back on every development in local government finance in recent years. Some aspects of the relationship between central Government and local government finance are an improvement on some years ago. To stay with the basic objective of a block grant, leaving local authorities to choose priorities among their overall responsibilities, remains sound.

9.30 pm

Mr. Nicholas Bennett (Pembroke)

I spent eight years as a local authority member, and served on social services committees for six of them. In the whole of that time, the debate was about more freedom for local authorities to decide their own priorities and how money was to be spent. We welcomed the abolition of specific grants for a whole range of local authority services. It is peculiar to hear people arguing to go the other way and to suggest as do some in local authorities, that they cannot trust themselves? Does not my right hon. and learned Friend find that strange, and does he have more faith in local authority members than do some right hon. and hon. Members?

Mr. Clarke

My hon. Friend makes a persuasive point and is correct in saying that the balance of local government opinion in recent years is that the way things have gone is to be welcomed by all political parties.

I have a letter from Mr. Robin Wendt, secretary of the Association of County Councils, who says: This is to confirm that the ACC would not support a system of specific government grant towards the general revenue costs of community care, and would endorse the line taken by the Secretary of State in the House of Commons earier this week. It would be putting the clock back to return to the concept of central Government earmarking funds for particular purposes.

Mr. Nicholas Winterton

What about capping?

Mr. Clarke

I hear arguments about capping, but there is agreement in the House on our policy of care in the community. There is a clear undertaking that when it is introduced, adequate funds will be made available. There is no problem about that. We are immersed in the details of local government finance, and as Secretary of State for Health, I will go as far as I need into local government finance and no further for the purpose of this debate. I am sure that you, Mr. Speaker, would rule me out of order if I embarked on a general debate on local government finance.

Capping is imposed not on councils that are in difficulty providing essential services but on those that have so mismanaged their affairs that they are incapable of delivering a decent service within the amount of expenditure incurred by reasonable councils elsewhere, and without prejudice to cases that may be proceeding before the courts at the present time.

Within the right level of resources, every local authority has the responsibility and duty to distribute its own resources, allocating them to the headings it thinks best. It should be accountable to its own electors for the standard of care that it then produces.

Mr. Rowe

The amendment in my name and that of my hon. Friend the Member for Ealing, Acton (Sir G. Young) is important. The Bill engendered considerable excitement because its intention appeared to be to give power to the consumer to an extent that has hitherto not been forthcoming. We have a long way to go before the consumer becomes sovereign in this difficult field, but there is no doubt that that is the intention of the Bill, and we welcomed it on that basis.

Having been given an assurance in Committee that consumers who had been given a right or an opportunity to manage part of their own budget in a way which enables them to purchase and control the purchase of services, arid who have done that with tremendous skill and to their own great satisfaction as it restored to them a degree of independence, it was a shock to discover Ministers appearing to resile from that assurance. Apparently, local authorities providing mostly severely disabled people with a part of their care budget for them to control might be in danger of being ruled illegal for doing so. The disabled and others who have had the ability to control part of that budget should be able to continue to do so.

I received a letter from the Spinal Injuries Association which is typical of the concern that has been expressed. It states: Government Ministers have on many occasions given their support to the many schemes already run by local authorities. A number of our members benefit from there schemes and they all work most successfully. The ability to arrange their own personal care assistance gives them independence, choice and control over their lives which would otherwise be unattainable due to the severity of their disability. That is what community care is about and exactly what we should aim to achieve. I want to secure a categoric assurance from my right hon. and learned Friend that the existing schemes and future schemes that could be made to work will not be put at risk.

The case against such schemes is the difficulty in defining those cases in which such expenditure authority should be given to the consumer. It is said that we could end up with all sorts of people asking for cash in hand. How would we know that they would not spend that on drink? We have heard that argument and all the others ad nauseum since the 19th century. Such arguments are demeaning to the tiny handful of people for whom the schemes have operated and the limited number for whom they are likely to operate.

People who want to manage their care in such a way will attempt to do so in a meticulous manner. If they are put under normal accounting procedures and are expected to account, monthly or quarterly, for how they spend the money, I cannot believe that there is any danger of the money being wrongly applied. I cannot imagine that people would damage their own care programme by pursuing such procedures badly. I hope that Ministers will give us an assurance about this issue.

I am one of those hon. Members who feel strongly that ring fencing would be a serious mistake. I have experienced a major reorganisation of services—I took part in the reorganisation of social work in Scotland—and I know that, once one reorganises a major service, the professionals begin to defend their frontiers. They put their tanks on the lawn. If ring fencing is provided for one group of professionals, all the others who may still retain a desire to co-operate closely with those professionals will feel less inclined to do so, because they will feel that those professionals have secured their money.

Mr. Favell

Does my hon. Friend agree that the councils involved with social services are more important than the professionals? The directors of social services departments are concerned about having to argue their case with their fellow councillors and directors on local authorities. They believe that the Government would be easier meat. That is what this is all about.

Mr. Rowe

I am not sure whether that is exactly so. My right hon. and learned Friend has already said that the record on social services has shown that in most part of the country social services departments have held their own well against other claimants on local authority budgets.

If community care is to work properly, we have to ensure that the consumers of community care are provided with satisfactory housing and receive education which allows them to live in the community. They have to be sure that they can maintain the in-and-out relationship with the health service that many of them require. If we ring-fence too firmly the budget for community care, we shall put up shutters between professions and make the increasingly promising co-operation between the various services much harder to achieve.

Mr. Robin Cook

I begin by welcoming the Secretary of State's amendment. He will recall that there was some debate on the matter in Committee and that both sides of the Committee supported making particular provision for those who had been involved in drug or alcohol abuse. We are glad that, even at this late stage, the Secretary of State has been able to respond to that anxiety. However, the amendment makes it all the more confusing that the Secretary of State believes that there is an issue of principle in resisting the idea of ring fencing. Whether or not we disagree with the Lords amendment tonight, when the Bill leaves this place it will contain two specific pieces of ring fencing—grants for those who are mentally ill and grants for those involved in drug or alcohol abuse. What is at issue in this debate is extending the same protection of ring fencing to other client groups of community care such as the elderly, the mentally handicapped and the disabled.

The Secretary of State asked what is different about that part of local authority expenditure which would justify departing from general grants and providing specific ring-fenced grants. I can answer that question. As the Secretary of State explained to the House, the concept behind this part of the Bill is the transfer of resources from the Department of Social Security, which currently supports elderly, mentally handicapped or disabled people who live in residential care, to the local authorities which will have the responsibility for meeting the bills for those client groups.

The House should contemplate ring-fencing those grants as without ring-fencing there is no guarantee that the resources transferred from the DSS to local authorities will be spent on those client groups. Without ring-fencing, the money could be spent on education, highways or industrial development—all splendid, excellent purposes in themselves, but not the functions for which the resources will be transferred. Without ring-fencing, the real danger is that the paradox of the Bill will be that instead of promoting community care we shall diminish the expenditure of the DSS without producing a corresponding increase in local authority spending.

At the beginning of his speech, the Secretary of State said that resistance to the Government's position and support for ring-fencing was partly based on the obscurity of the issue. This is a bipartisan debate, so let me counsel the Secretary of State in a friendly spirit—[Laughter.] Perhaps he should wait until I have finished before he gets too excited. If I may counsel the Secretary of State as a friend, one of his less attractive features is to lecture those who disagree with him on the basis that they do not know what they are talking about. However, the Secretary of State stands absolutely alone among informed opinion on this issue.

Sir Roy Griffiths certainly knew what he was talking about, and he stands by his original proposal for ring-fencing. At the outset of its report, the Select Committee quotes Sir Roy Griffiths: I have provided a purposeful, effective and economic four-wheeled vehicle, but the White Paper has redesigned it as a three-wheeler, leaving out the fourth wheel of ring-fenced funding. There is no suggestion that Sir Roy Griffiths regarded ring-fencing as just another tree in the wood—to use the Secretary of State's analogy. Ring fencing was essential to the balance of Sir Roy Griffiths' package.

All the voluntary organisations that are concerned with the client groups want ring fencing. When preparing for this debate I received representations from the Spastics Society, Age Concern, the Royal National Institute for the Deaf, MENCAP, the National Council for Voluntary Organisations, the Carers National Association and RADAR—the Royal Association for Disability and Rehabilitation—which specifically asked me to say: RADAR will be deeply disappointed if the Government rejects the Lords amendment on ring fencing.

9.45 pm

Mr. Michael Jack (Fylde)

Which local authorities have written to the hon. Gentleman about this? Has he personally received a representation from the Association of County Councils on this issue? Will he place on record which Labour-controlled local authorities would not carry out their responsibilities for community care along the lines that he suggests?

Mr. Cook

I can happily answer the hon. Gentleman's first question about which local authorities have written to me on the issue—88. I have carried out a survey of local authorities.

Mr. Jack

There are 400.

Mr. Cook

There are not 400 social services authorities, if I may correct the hon. Gentleman. I hope that I can do so without falling into the Secretary of State's error of saying that he does not know what he is talking about. There are only 116 social services authorities, and 88 is a good response rate.

In an earlier speech during the debate on the guillotine motion, the Minister for Health unfairly chided the hon. Member for Lancaster (Dame E. Kellett-Bowman) for lacking confidence in local authorities.

Dame Elaine Kellett-Bowman

I have no confidence in Lancashire.

Mr. Cook

I had hoped to assist the hon. Lady and I am terribly sorry if I have succeeded in causing offence. I think that the hon. Lady served on a local authority at one time, but not in Lancaster.

Those of us who listen to what local authorities are saying about ring fencing do not lecture local authorities on what we think is in their good, but show greater confidence in them. I can give the hon. Member for Fylde (Mr. Jack) the precise breakdown he seeks. Of the 88 local authority directors of social services who responded to me, 84—[HON. MEMBERS: "That is different."] The directors of social services certainly know what they are talking about and cannot be accused, as the Secretary of State accused his critics, of being involved in obscuring the issue and failing to understand what is at stake. They are the very people who will have to administer care in the community. I deprecate the way in which some Conservative Members jeered at the mention of the directors.

Of the directors of social services, 84 supported ring fencing and many said that it was essential. Only two local authority directors of social services were against ring fencing. Both of them came from Labour councils, one of which is so popular with the Government that it has just been poll tax-capped.

Dame Elaine Kellett-Bowman

I have no quarrel with the Ministe, because I have no confidence in Lancashire local authority to spend the money on social services. It will blue it on anything it likes. My hon. Friend the Minister obviously has more confidence in the Lancashire authority than I have, but she does not live there; I do.

Mr. Cook

A sound rule that I am sure all hon. Members follow when canvassing is that, when promised a vote, one does not inquire too closely into the motivation for it. I have possibly gone too far against that rule on this occasion.

Mr. Hind

The hon. Gentleman made a good point when he took up my hon. Friends' comment on the social services directors. I take on board what the directors said, but what do the local authorities and the elected representatives think? I appreciate that the hon. Gentleman has gone to the experts, but what do the people whom they serve think? That is an entirely different matter.

Mr. Cook

The hon. Gentleman is right that there is a distinction here, but it is not as great as he suggests. Many of those directors made it clear that they spoke on behalf of their committee and their local authority. I am not aware of a single director who made representations to me which are in conflict with the position of his local authority and I should be surprised if there was one.

Mr. Hind

What about the Association of County Councils?

Mr. Cook

The ACC is out of step, but all the other official organisations of local authorities are in favour of ring fencing.

Mrs. Audrey Wise (Preston)

Will my hon. Friend give way?

Mr. Cook

I will give way to my hon. Friend, but this must be the last occasion.

Mrs. Wise

The Select Committee report says that the Association of County Councils stated: The Association's view is that the major element of Government financial support to local government should be by means of a general grant mechanism. The Association also accepts that there is a role for specific grants in certain circumstances. One such clear role would be to recognise the additional costs of preparing for implementing the proposa Is in the White Paper … Community Care resources must be actually available to individual social services authorities. This implies the separate identification of resources for individual authorities". Therefore, the ACC is not really out of step. It is asking for specific identification.

Mr. Cook

I am grateful to my hon. Friend for clarifying so clearly the ACC's position, although I did not expect that she would emerge as its spokesman.

The Secretary of State referred to the increase in social services expenditure during the past 10 years. That point was also made by the Minister for Health in the earlier debate. Both quoted a 37 per cent. increase in social services authorities' expenditure.

During the past few years, there has been an increase in social services expenditure. I am bound to tell Ministers on the Front Bench that their colleagues in Whitehall complain all the time about that increase in local authority expenditure. If local authority expenditure continues to increase, they will find themselves being capped, as 19 social services authorities have been capped by the Government. Other people along that ministerial chain in Whitehall have devised the poll tax with the particular objective of making local authority fund-raising as painful as possible, and so making an increase in local authority spending as unlikely as possible.

I warn the Secretary of State that if, during the next few years, the poll tax survives and local authority spending on social services increases by 37 per cent., Downing street will certainly regard the poll tax as having failed. Given that new element in local authority finance, severe and savage as it is, it is unlikely that that upward trend in local authorities' social services spending will continue. If the Secretary of State consults the survey of the Association of Directors of Social Services, he will find that even this year one third of all social services departments are cutting services because of the financial squeeze caused by the poll tax.

I can forgive the Government for setting aside the views of Labour councils. I can well understand that they must be embarrassed at finding themselves in the company of Derbyshire, stoutly resisting the call for ring fencing, while simultaneously poll tax-capping their allies. But what about the Tory councils? With respect to the hon. Member for Lancashire, West (Mr. Hind), I did not receive a single response from a director of social services from a Conservative-controlled area who was opposed to the principle of ring fencing. Every director in every Conservative-controlled social services authority from which I received a response said that he supported ring fencing. Even the flagships, Wandsworth and Westminster, have mutinied on this issue and stuck to their guns.

In case the hon. Member for Lancashire, West (Mr. Hind) seeks to intervene to prolong my speech yet again, I must point out that not just the directors but Wandsworth and Westminster social services committees concluded in favour of ring fencing. The chair of Westminster social services committee has been to see the Secretary of State to argue the case—[Interruption.] I am merely going by the minutes of the Westminster committee, which I very much hope has not been misled on that point.

The reason why all these councils, including the two favourite sons of the Government, favour ring fencing is not, as the hon. Member for Pembroke (Mr. Bennett) said in an intervention before absenting himself, that those councils do not trust themselves; they all, Conservative and Labour, want ring fencing because they do not trust Ministers. In a bipartisan spirit, I must tell the Secretary of State that they are probably wise to distrust Ministers of both political persuasions because, as those councils know, if Governments can get away with burying the resources for community care beneath the mountain of Exchequer grant, no one will be able to see what is going into community care—

Mr. Peter Thurnham (Bolton, North-East)

Will the hon. Gentleman give way?

Mr. Cook

I will not give way again.

The whole point of a ring-fenced grant is to force Ministers out into the open so that everyone can see what they put on the table. Here I must disagree with the Minister for Health. She claimed that ring fencing would not, of itself, guarantee a single extra penny for community care. I am not so sure. I rather suspect that one reason why the Treasury is so anxious to resist ring fencing is that it knows that the moment it comes out in the open the more difficult it will be to resist the pressure to put a realistic sum of money into community care. If ring fencing makes it clear what local authorities are getting, it will also make clear where responsibility lies if those resources are inadequate, and that is precisely why Ministers would run a mile rather than accept the principle.

I have a nightmare—not one of the Secretary of State attempting to run a mile—that in some future year the Secretary of State for the Environment will announce to the House that, once again, because of the economic climate, it has unfortunately not been possible to increase public spending by as much as had been hoped. Once again it will be necessary to look to local authorities to make their contribution to economic recovery by accepting a reduced revenue support grant. On the same afternoon, over in Richmond terrace, the right hon. and learned Gentleman will pop up at a press conference announcing how delighted he is that the community care element in the revenue support grant has been expanded that year. Everyone will know that that will leave local authorities in an impossible position, once again having to allocate cuts across all the budgets with no prospect of expanding spending on community care or anything else.

Such an outcome would be unfair to local authorities. It would also be unfair to Parliament, which would be unable to pin the blame where it belonged. Most of all, it would be unfair to the people who need community care—to the mentally handicapped, whom the NHS is discharging into the community as fast as it can sell their hospitals; to the elderly, whose only contact with the outside world is often their home help for whom they now have to pay higher charges for reduced hours; and to the carers who look after these people, often providing 24–hour nursing with no training and little support and often as isolated as those whom they look after.

These are not people who can readily fight their corner. They are vulnerable people, not well organised and with no great political clout. It is fitting that Parliament should offer a special arrangement to protect them. That protection should be ring fencing. I urge the House to support the Lords amendment.

Mr. Thurnham

The hon. Member for Livingston (Mr. Cook) did not want me to intervene when he was talking about Ministers coming into the open. He failed to come into the open himself. If some future Labour Government—perhaps part of the nightmare that he talked about—were to go in for ring fencing, how much money would be provided? Would it be enough to satisfy all the needs and would it be sufficient to provide the estimated £24 billion for voluntary unpaid care? That is the amount that Government would have to find to fund all the requirements.

10 pm

The right hon. Member for Stoke-on-Trent, South (Mr. Ashley) talked about spending on the disabled being unpopular. I respect his long experience in this field and we have to accept that in the past that was true, but surely it is no longer true. Now and in the future, the disabled should lobby and form action groups to press for spending. If care in the community means anything, it means that the disabled should press for such spending in their own communities.

The Government are giving responsibility to local authorities. The argument about ring fencing seeks to shirk those responsibilities and difficult decisions, but they can no longer be shut away so that someone else has to face them. Local authorities must face them now. We should not listen to the argument that somehow or other the Government can take care of such matters. Such matters must be managed in the community and local authorities will have to make difficult decisions. They will have to make balanced judgments, decide on the level of community charge and how much to spend on the disabled and how much on roads.

There is no substance in the argument that money is being diverted from social spending to roads. In my constituency spending on roads has been cut and spending on social services has increased substantially. For certain cases it has doubled. Total social spending by local authorities has risen by 37 per cent. and Government spending as a whole has also risen. There is no way in which sufficient funds can be made available either by Government or by local authorities to pay for the massive amount of unpaid care.

Decisions must be made about priorities so that the people who are most in need of care are given that care. We have seen dreadful cases in the past in which people who were most in need were given the least care. It is the responsibility of local authorities to identify those who are most in need of care, to make the proper assessment and then to assess the priorities. No one is saying that that is easy, but local authorities have been given that responsibility. I did not fully agree with that recommendation in the Griffiths report, but we have decided to give responsibility to local authorities. They should go ahead and carry it out and not think that they can look to the Government to provide some ring-fenced amount to take care of the matter.

It has been estimated that unpaid care is worth £24 billion. Obviously that care cannot be quantified exactly, but it compares with about £6 billion of public funding. There is an enormous gap, and the local authorities must decide how to bridge it. I welcome the suggestion that specific grants should be made to voluntary groups which can organise to provide such care. I suspect that such groups could provide it much more efficiently.

One of the arguments underlying that suggestion is that local authorities do not use money efficiently. The network homes in my constituency cost some £22,000 per year per resident, whereas in a voluntary home nearby that cost is only £12,000 per resident and a higher standard of care is provided. That shows the difference in efficiency in providing care. That is one of the reasons why I do not think that ring fencing would make everything right. As my right hon. and learned Friend the Secretary of State has said, it is for local authorities to be responsible and accountable. We should remember that when we are voting.

Mr. Kennedy

The hon. Member for Bolton, North-East (Mr. Thurnham) will forgive me if I do not follow his line of argument. Indeed, I did not follow his line of argument when it was deployed. In common with the hon. Member for Mid-Kent (Mr. Rowe), I am not entirely sure what he wanted. That merely reflects the difficulty and confusion manifested by the Secretary of State for Health. I agreed with the point that the hon. Member for Wakefield (Mr. Hinchliffe)—who served on the Committee that considered the Bill—made with deadly accuracy towards the end of the Secretary of State's speech. The hon. Gentleman said that, by conceding the need for ring fencing in the cases in his own amendments, the Secretary of State was conceding the principle, of ring fencing. That makes all the more nonsense of the artificial argument that we heard from the Secretary of State. We know that in its heart the Department of Health would probably like to concede the principle, but that the blocks have been put on elsewhere—elsewhere being Her Majesty's Treasury on the other side of Whitehall.

Towards the end of his speech, the Secretary of State touched on local government finance. He looked as unconvinced by his argument as those of us who will vote in the opposite Lobby to him later this evening. The Secretary of State did not appear to have much confidence in the case that he had to deploy. It reminded me of a description of an advocate who plugged away at the defence of his client when the client had changed his plea to guilty.

In the Parliament of 1983 to 1987, I had the opportunity to serve on the Select Committee on Social Services with the hon. Members for Macclesfield (Mr. Winterton) and for Eastleigh (Sir D. Price), from whom I am sure that we shall hear shortly. It has been said many times, and it was said from the Conservative Back Benches a few moments ago, that the Association of Directors of Social Services would be bound to say that. It is fair to record that any inquiries into the subject carried out by the Select Committee on an all-party basis found that not only those who sought to provide the service and had a vested professional interest supported proposals such as that for ring fencing.

It was clear that voluntary groups, as well as professional groups in the front line of delivering the care services and packages which might be involved, knew that unless the funds were earmarked to some degree, there could be no certainty that the decisions made and the political motivation at the centre would lead to the delivery of services where required, when required and in the form required. More than anything else, that was the motive behind the proposal for ring fencing which is gathering such a head of steam behind it. Those who seek to back up the position of the Department of Health would do well to remember that ring fencing is supported not only because of special pleading. It goes much wider and deeper than that.

The Secretary of State also mentioned the poll tax. In Scotland we have not yet had the delight of safety net arrangements, but in many parts of the country south of the border as the safety net is withdrawn there will be increased and intensified pressure on local authority budgets and, therefore, the spending commitments that local authorities can make. Their commitments will be adjusted to the level at which they can set the poll tax in their community.

Conservative Members should be under no illusion: any Conservative Member whose local authority is inevitably faced with such pressure will not be able to meet the requirements or aspirations in community care. Authorities will not be able to deal with the problems presented to them unless they have some degree of ring-fencing. There will be the bloodbath to try to make sense of the Budget and to keep the poll tax at a politically acceptable level. Yet at the same time local authorities will have to deliver a reasonable degree of service in the community. But that cannot be achieved.

The more voices we hear from the Conservative Benches raised against the position of the Department of Health, the better. I hope that the Department may yet change the proposal in the amendment and extend it. The Secretary of State says that he has conceded the principle. If he can concede the principle, I cannot for the life of me understand why he cannot accept the logic of that by agreeing to the amendment.

Sir George Young

A large number of my hon. Friends wish to contribute to the debate, so I shall be brief.

I warmly welcome Government amendment (c) to the proposed Lords amendment. As my right hon. and learned Friend the Secretary of State said, a number of us were concerned about the impact of the policy on hostels run by Turning Point and Alcohol Concern. We feared that they would simply close because the local authorities would not place the relevant contracts with them in April next year. Amendment (c) gives them the assurance and the protection for which they have asked, and I am grateful to Ministers for responding. However, the amendment somewhat undermines the Ministers' case against ring-fencing. My right hon. and learned Friend said that it was legitimate to ring-fence for services that local authorities were "inclined not to provide". The fear is that local authorities may be inclined not to provide some of the other services in the Bill unless that provision is also ring-fenced.

My right hon. and learned Friend said that, if we ring-fenced such provisions, we should have to ring fence education and provision for children. The crucial difference, however, is that there are statutory responsibilities in respect of education and children. It must be clearly stated that there are very few statutory responsibilities in the Bill. The Bill contains a large number of objectives for the standard of provision, for co-ordination, for co-operation and all the rest, but places few statutory duties on local authorities. The feeling is that, if adequate resources are not given to the local authorities, the services that we all seek will simply not be provided because they will be squeezed out by other responsibilities that the local authorities have no option but to deliver.

Mr. Robin Squire (Hornchurch)

Does my hon. Friend accept that the large number of statutory services that exist at present, including education services, have not prevented a wide range of other services from being provided? In each case, the local electors can determine whether they are happy with the level of service. I may even help my hon. Friend's argument, which is not my prime aim, if I point out that many of us would argue that, although adult education is a statutory service, that does not necessarily mean that it is provided.

Sir George Young

I hope later to consider my hon. Friend's valid points.

Initially, when we discussed the matter in Committee, I was wavering; in the end, I voted against the Government. The way in which one votes depends very much on the question that one asks. If one asks what is most likely to deliver effective care in the community, one ends up with the answer, "Ring fencing." If one asks what the conventional means of funding local authorities is, one comes up with the answer that it is not ring fencing. And if one is concerned that there may be some initial disappointment at the level of care that is delivered, one may want not to ring-fence but to put local authorities more in the firing line in future years.

We are discussing a Government policy. The White Paper was a Government White Paper and this is a Government Bill. We have said quite clearly that we are not satisfied with the standard of care in the community and that we wish to improve it. We wish to drive up the quality of care and ensure that it is effectively tailored to suit individual need. I do not see how one can make that statement and invest political capital in it and then say that, the moment the Bill has left the House, everything will rest on the slender basis of local accountability. I do not think that one can wash one's hands of the policy.

We have an obligation to fund the commitment that we are placing on local authorities by making it quite clear that the resources will follow through. It is all very well my right hon. and learned Friend saying that local authorities' social service departments have defended their corner and protected their client. What constitutes "defending one's clients" to one Department, the Department of the Environment and the Treasury will regard as overspending.

I wonder whether, as more local authorities are poll tax-capped, they will be able to go on defending their corner and protecting their clients. If we move towards poll tax capping, local authorities will say, what are our statutory responsibilities? What are the services that we have no option but to provide? They will focus on those services. They will say that they have no statutory responsibility to provide care in the community and that they do not have the resources for it.

10.15 pm

In Committee my right hon. and learned Friend made a few commitments. He said: When they have the new revenue support grant, it will be increased by a visible transfer from social security of the amount they would have spent before. We are moving, therefore, towards the era of visibility. If not ring-fenced, the sum will be identifiable. My right hon. and learned Friend also said that local authorities will require an additional allocation of resources from central Government, well above what they have had in the past to discharge that responsibility."—[Official Report, Standing Committee E, 20 February 1990; c. 1116–18.] I agree wholeheartedly. I wish that commitment to be made explicit by ring-fencing it. The suspicion is that, if it is not ring fenced the commitment given in Committee will not be honoured.

My right hon. and learned Friend's case is that we can take the horse to the water but we cannot make it drink. The case that I and others make is that if we put enough fresh water in front of the horse it will drink it. We want to ensure that resources are available to fund this exciting, innovative and radical policy that is broadly welcomed throughout the country. Without ring-fencing, there is a risk that local authorities will be unable to provide that policy with resources and that our expectations will therefore not be fulfilled. That is why I hope that the House will uphold the Lords amendment.

Mr. Ashley

I wish to make a brief contribution on an issue of great importance to the disabled. The Secretary of State made a thoughtful and good debating speech, but he did not persuade me. I am convinced of the need for ring-fencing these funds for community care. The Secretary of State's answer failed to deal with the basic point that severely disabled people are not politically popular. Given their unpopularity, money will not be allocated for their needs. That is why the money has to be ring-fenced.

The Minister for Health said earlier that to ring fence would be to undermine local government. The Secretary of State said that we should not second-guess local authorities. That is precisely what the Government have been doing time and again with their rate capping and poll tax capping. They have been second-guessing and undermining the role of local government. They cannot now hold up their hands in horror and say that local government should be entirely free; that is the exact opposite of their previous actions.

The hon. Member for Bolton, North-East (Mr. Thurnham) conceded that the disabled are politically unpopular but that they should campaign and lobby for funds. How preposterous. Most severely disabled people are too unwell and too preoccupied with grappling with their disabilities to lobby hon. Members. I have urged them to take part in campaigns, but elderly people and those who are severely disabled cannot fight. It is our job—I include the hon. Member for Bolton, North-East—to campaign for the disabled. One of the most effective ways of doing that is to press for funds to be allocated specifically for their needs.

When people speak of local government being responsible, they are talking nonsense. There are both bad and good local authorities. We are concerned with the bad local authorities—the iresponsible authorities and those that make bad decisions. A prime example was referred to on "Panorama" last Monday. A director of social services said that he is cutting social services resources for the elderly disabled and using them instead to combat child abuse. That may be a reasonable decision. We should all do what we can about child abuse, but the fact is that that local authority is thereby robbing elderly disabled people. That is an example of money not being allocated to community care for disabled people because the authority thought that it should go elsewhere.

The answer would be more funds from the Government. The evidence from the Minister's own inspector shows that six local authorities have spent nothing on community care. That is a devastating indictment of the Government's policy of failing to ring-fence. There is no doubt that that is a bogus policy. It would damage disabled people because, without ring-fencing, that money could be spent on all kinds of things such as children, housing tenants, or even fancy bypasses—something which is highly popular and can win votes for a local authority.

The proposal for ring-fencing money for community care for severely disabled people and for old people is important, valid and unanswerable. I hope that hon. Members who believe in campaigning for disabled people will go into the Lobby tonight and support their views and their contentions. If they do not, disabled people will suffer, and the House of Commons could not tolerate that.

Mr. Squire

This is an unusual event. Having heard my hon. Friend the Member for Ealing, Acton (Sir G. Young), it is customary for me to find points on which to agree, but on this occasion I believe that he is wrong. He said that it would depend on the position from which one started. I make it clear that my position is largely as it has been ever since I entered the House in 1979. I strongly believe that local authorities should have maximum freedom to determine their priorities as they see them within a general budget, part of which will be supplied by central Government and part of which they will look to local ratepayers to provide. I shall often disagree with the way in which my local authority determines those priorities. For instance, I have spent years arguing the case for a greater allocation for adult education, and I suspect that I shall spend several more years arguing for greater allocations for recycling and other environmental issues. That is the nature of the beast. I want local authorities to be given the maximum opportunity.

If local authorities are to be able to take real decisions, such decisions must also include the right to make mistakes. If they cannot make mistakes they are not ultimately given the power to take decisions.

Care of the elderly is important, but so are mandatory education, housing the homeless, and a range of subjects that we rightly expect local authorities to deal with. In those instances, we have not so far said, "You are to have a specific grant for that revenue expenditure, which you must spend on that and on nothing else."

I can understand why Opposition Members support ring fencing if they are strongly committed to and identify with social services and care for the elderly. They do so for one of two reasons. They may fear that they may not get money either from central Government or from their colleagues within a particular local authority. I understand that, but I repeat that their argument is no different from the argument that, if education were ring-fenced at about 70 per cent. or more of a local authority's budget, it would significantly reduce that local authority's ability to take decisions.

Mr. Hind

My hon. Friend mentioned an important point that was made by the hon. Member for Livingston (Mr. Cook), but there is a fundamental flaw. If whatever Government reduced the amount of money made available to local authorities, elderly people requiring residential care would be adversely affected. Equally, the same hard decisions would have to be made for groups with special needs, such as special needs education. A reduction in expenditure would hurt people whose needs are great. Therefore, if one extends the logic of the argument, every local authority budget should be ring-fenced. Surely it must be all or nothing.

Mr. Squire

My hon. Friend may have anticipated my final comments. I agree that this is, in effect, a half-and-half measure.

As ever, the hon. Member for Livingston made an amusing, pertinent and relatively brief speech. I was less than surprised as he reeled off the number of social service directors and committees who, given the opportunity, would like this growing share of their budget to be guaranteed. As a former chairman of a local government finance committee, it came as no great surprise to me. The pressures on leaders of local authorities, who are charged with balancing inevitably conflicting demands, are and always will be hard, regardless of the complexion of the Government or of the authority, but one does not hear them clamouring for the discretion of their authorities to be further reduced. The Association of County Councils opposes ring fencing, and I agree.

My hon. Friend the Member for Ealing, Acton beguilingly said—he almost persuaded me—that the Government had given an undertaking and that this was the only way that it could be carried out. You, Mr. Speaker, have sat in the Chair over the years and heard many undertakings given by Government, many undertakings given in spheres that I have mentioned and others administered by local authorities. In practice, the Government will provide such sum as they deem reasonable; some local authorities will meet it, some will not and some will over-budget and spend more than the Government allocate.

My hon. Friend the Minister may not agree with my next comments, because I question whether Government can determine need, district by district, as accurately as they should so that the figure produced would be accepted by everyone in every city and town as the right figure. I have never believed that. Veterans of this Chamber will have heard me argue with Ministers when it has been suggested that the Government should be able to do that. If we use the best mechanisms that we have and the most up-to-date forecasts that can be produced, we in Westminster or Whitehall will not know better than people in their respective councils, counties or districts. I believed that when I became a Member, and I firmly believe it today.

The central issue is whether we wish to move further to a system of hypothecated grants or to retain broadly general funding. If one believes in more fixed grants and a system which makes local governments spend 70 per cent. on education and 10 per cent. on social services, as my hon. Friend the Member for Lancashire, West (Mr. Hind) said a moment ago, logically one should press for that across the spectrum and say, "That is how grants should be made." If one does not, one should, with respect to their Lordships, resist the Lords amendment.

10.30 pm

Mr. Hinchliffe

The central issue that we must address tonight is how we can expect local authorities properly to plan for the changes included in the legislation, without the guarantees that would be provided by ring fencing.

It is important to stress that the majority of local authorities that will face the task of implementing the legislation are in utter chaos as a result of the introduction of the poll tax, the threat of poll tax capping and the fact that they already cannot meet their statutory social services obligations. It is nonsense to suggest that local authorities have no idea of the budgets that they will have to implement these provisions. The standard spending assessments bear no relation to local authorities' requirements.

We must consider the adequacy of the present funding for community care. To ring-fence next to nothing still leaves a local authority with next to nothing. To ring-fence inadequate social services budgets will not enable local authorities to meet the needs that they are required to meet, especially as they will face increased demand.

Wakefield will have an enormous problem with its social services budget because the SSA for the current financial year is £4,268,000 below the budget. In the words of the director, it is "nowhere near enough" to meet daily needs. The Government talk about the great things being in store for those who will receive community care, but to achieve its SSA, the district council would have to cut one fifth of its existing budget. The director would have to make cuts, had he not had the support of the local authority to defend his corner, involving the loss of nearly 600 care staff who are the direct providers of statutory social services care, the closure of four homes for elderly people in Wakefield, the possible closure of two children's homes and the closure of a home for the mentally handicapped. As Mr. Lane said, Wakefield district council could not fulfill its statutory responsibilities. Yet the Government say that the figure is appropriate for my local authority's budget.

The council would have to put juvenile offenders in prison, and children with mental handicaps in hospital, and many children who require statutory supervision because they are at risk could not have a social worker allocated to their case. How on earth can anyone defend such an SSA? I should like to see the people who define these regulations and assessments beg for a place in a home for their elderly mother or relative who cannot cope. That is what is happening.

Mr. Ian McCartney (Makerfield)

The picture that my hon. Friend paints is horrific, but it is the norm in a key number of local authorities. More than 20 local authorities, including my own, are being poll tax-capped simply for providing care at statutory care level. They have been attacked by the Secretary of State for the Environment for doing so and are having to take millions of pounds off their current budgets for the provision of statutory social services care. Unless there is ring fencing, local authorities that are prepared to provide care up to the limitations of statutory provision will be penalised because, having provided care, another department will be constrained by another piece of legislation. Unless the Secretary of State resolves that, more local authorities will be poll tax-capped simply for meeting the requirements of legislation produced by the Secretaries of State for Health and for the Environment and for not cutting their budgets.

Mr. Hinchliffe

My hon. Friend is right. He has first-hand experience of poll tax capping in Wigan. I have never regarded Wigan as a particularly extravagant authority. The people of Yorkshire were shocked and amazed when Barnsley and Calderdale were included in the list. No one could suggest that those authorities are overspending or being over-generous with their provision.

In Wakefield, the projected figures for the needs of the area in the next financial year, including the costs of implementing the Children Act 1989 and this legislation, and the introduction of the NVQ scheme, will involve a difference of £30.5 million between the SSA which the Government provide and the actual budget. I honestly do not know where the cuts in provision will be made. My authority spends 20 per cent. below the average metropolitan authority. It is a low spender when compared with other authorities.

There is a need for stability in the funding of community care. Local authorities want to know where they are going and how much they have to play with when they are planning services. They do not want to have to guess about their provision at the last minute. It makes no sense to have an SSA that bears no relation to the needs and statutory responsibilities of local authorities.

I want to broaden the debate. As I stressed in Committee, we need a major shift in the direction of funding away from institutional care towards community care. We can guarantee that only by the provisions in this Lords amendment. We must ring-fence the provision that allows us to consider the alternatives to traditional measures. According to the traditional provision, when granny needs care, she is shoved into a home.

Members of the Select Committee on Social Services recently visited Europe to consider the alternatives to our traditional provisions. We must get away from the tunnel vision in which our only response to meet the needs of the handicapped, the elderly and those with special needs is to put them into homes. To achieve that change we must have direction and planning of community care.

Under this Government, there has been a complete absence of planning and direction of community care. The Government have been prepared to abrogate their responsibility and to leave it to the market. The market has not provided what the service users want. Instead, entrepreneurs and business men provide what they believe they can make money from. I believe that a vast sum of money—up to £1 billion—has been thrown away on creating institutional provision which is not what people need.

We must divert that funding towards preventing people from entering institutions. We should not be actively encouraging them to do that through the open-ended financial support that is proposed. When the Minister of State responds, she may say that the Government have changed the scene by introducing assessment and case management. That is the point that the Secretary of State made earlier. It is all very well to say that we have assessment in case management, but a social worker assessing someone in need can make care recommendations only on the basis of the services that are currently available.

We should be investing in alternatives in the community that are designed to keep people out of homes. The Government have diverted funding away from preventive services and shoved them into the open-ended commitment to private old people's homes. The only option for the vast majority of people is a home, because there is no support for them to remain in the community.

We should completely change the direction of funding on community care. We need a new radical agenda for community care and I hope that that will be introduced by the next Labour Government very soon. The central commitment of that agenda will be to enable people to remain in their homes. It will invest in keeping people in the community instead of removing them from it. That will entail a complete redirection of public resources to the prevention of need in the community instead of actively encouraging institutional care.

Last week, the Minister of State attended a conference at which I too was present. Unfortunately, she did not hear a contribution in the morning from a lady called Rachel Hurst, a disabled person who is probably well known to many hon. Members of all parties because she is active in the British Council of Organisations of Disabled People. With respect to those hon. Members who also made speeches, I think that that lady made the most telling point of the entire day-long conference, when she said that the central issue was the need to change the priority of allocation of resources to independent living. That is the challenge which the Government have ducked.

The change in direction can take place only if we have guaranteed resources to enable us to invest in alternatives to institutional living. In that context, Lords amendment No. 70 is absolutely essential.

10.45 pm

Sir David Price

I very much regret the fact that we are having this important debate in the terminal moments of the Bill's passage through Parliament. Those of us who serve on the Select Committee on Social Services produced a report on these matters for this House, not another place, before the Report stage, but it was never discussed because the appropriate new clause was not reached because of the guillotine. I hope that hon. Members have read our report, because I stand by it. I think that their Lordships did so, too, and I believe that it inspired their amendment No. 70.

The House will not be surprised to learn that I shall be speaking in favour of the amendment, because I stand by the report that the Select Committee prepared with great care. As the House knows, I am rather old-fashioned and I believe that it is a matter of honour that one should vote on the Floor of the House exactly as one has voted upstairs, which is what I shall do tonight. I do not apologise to the Government Front Bench for being a man of honour.

The issue is simple: should grants voted by Parliament to local authorities to help them to fulfil their community care function be specific, and therefore identifiable, and therefore earmarked, or should they be simply an enhanced element in the standard spending assessment? In his effort to persuade the House that this is the right route, my right hon. and learned Friend did not give us any information about how the SSAs are to be altered to take into account the enhanced role of care in the community.

My hon. Friend the Minister for Health will remember a happy little debate that we had when she was in a different Department, which ended with me voting against the Government on their support rate grant formulae. We went into four or five decimal places and I made a little fun of the arithmetic because it was incomprehensible. I believe that we are in danger of getting into the same position now. Frankly, I am not satisfied that the enhanced role that this House is agreed upon for care in the community will, in terms of resources, be taken care of in the SSAs. We have heard nothing on that tonight.

In a moment of total generosity—it is the Queen Mother's 90th birthday—I offer the David Price prize for comprehension to any hon. Member who, before the debate is over, can catch your eye, Mr. Deputy Speaker, and explain in simple language how the SSA formula will be altered to accommodate care in the community. That offer stands. Indeed, I shall withdraw my opposition to the Government's objection to the Lords amendment if, when my hon. Friend the Minister replies to the debate, she can do what she was unable to do—I say that with all my normal generosity—a few years ago when I attacked the old rate support formulae. That is a fair offer, is it not? If they cannot do so, I invite the Government to rethink their position and to join those of us who are the vast majority of thinking people in these matters. After all, this is not a matter of deep principle; it is a matter of practice.

My right hon. and learned Friend the Secretary of State went a little further tonight, and we welcome that. He is to include alcohol and drug abuse within the provisions. When he says, "The mentally ill are separate," hon. Members may well ask, "Why not the mentally handicapped?" What distinction is there? At what point does someone with Alzheimer's disease cease to be geriatric and become mental? I know that an elderly person with dementia has problems, but to distinguish whether that person falls into the category of the mentally ill or the geriatric is a difficult decision.

Mr. Rowe

If the Government ring-fence services to drug addicts and alcoholics, they will receive the money, but if the Government ring-fence the entire social service budget, how will those individuals who need to be protected within the local authority budget get the money?

Sir David Price

My hon. Friend is advocating an admirable reason for detailed ring fencing. I know that he will have read our report and will know that we offered the Government and the House five different options. At this late hour I shall not take the House through the report, but I assume that my hon. Friend, with his normal application to such matters, has studied it. After the debate, I should like to talk to him about which option he prefers. My hon. Friend has gone further than me by arguing for detailed ring fencing. If one is thinking in terms of the Cinderella services, a case can be made along those lines.

There is nothing new in the concept of care in the community—it has been with us since the beginning of settled communities. What is new is the higher profile attached to it by the Government, which is absolutely right. If such care is to receive a higher profile, however, the natural concomitant conclusion is surely that one must provide the resources to do so.

We discussed choice in the sixth report of the Select Committee. We quoted a number of local authorities who believe that, while that choice is a lovely idea, if they do not have the resources to provide it, what does it mean? We can all go to the Ritz, but if one does not have the money to buy tea there, what is the use of going? In those circumstances, one's choice is theoretical. The same is true of community care.

Resources for community care have always come from a variety of sources—and let us not forget the voluntary sector. That variety of sources will remain, but germane to our debate is that amount of central Government money that hitherto came from the Department of Heath. What will happen to that money? That is the core argument. One could consider the totality of current expenditure, but we are specifically concerned with the amount that comes from central Government.

In the circumstances, it is worth considering all the representations that the Select Committee received from the voluntary and professional organisations. The views of the Queen's Institute of Nursing, which represents district nurses and community nurses, are probably even more important than those of the Royal College of Nursing. That institute is clear about what it wants to see.

I am sorry that my right hon. and learned Friend is no longer present as it is important to note that the local authority associations are in favour of ring fencing. The Association of Metropolitan Authorities said: The Griffiths Report recommended ring-fenced funding for Community Care and the Association supported this proposal. The Association of County Councils appears to have undergone a sea change since it gave evidence to the Select Committee. The hon. Member for Preston (Mrs. Wise) quoted the initial part of its evidence. It went on to say:

Community Care resources must be actually available to individual social Services Authorities. This implies the separate indentification of resources for individual authorities and it implies the need for a suitable distribution mechanism. I am astonished that the Treasury is not in favour of specific grant and ring fencing—I am delighted to see my right hon. Friend the Chancellor on the Front Bench—because, from the point of view of accountability, the money voted by Parliament for community care is spent on what we voted for. I should have thought that my right hon. Friend the Chancellor, the Audit Commission and the Public Accounts Committee would agree that what we are suggesting—a specific, ring-fenced grant—would provide that accountability, which would not be achieved in the alchemy and mysticism of the SSA. The David Price prize for comprehension of SSA remains on the table until the House rises tonight. I hope that the Treasury will reply to my questions.

I believe that it would be correct to follow the advice of the Select Committee—if that does not sound too conceited coming from a member of it—the advice of their Lordships—everyone loves a peer—and the advice of every voluntary and official body in the country. I invite my right hon. Friends on the Front Bench to join the mass movement in favour of care in the community. I hope that, on reflection, they will remove their objections and that at 12 o'clock we shall conclude our discussions without a vote, all agreeing that their Lordships were right.

Mrs. Wise

Having listened to the speech of the hon. Member for Eastleigh (Sir D. Price), I can abandon quite a few of my remarks, because he has explained so clearly the thinking behind the Select Committee report. However, it is probably worth reminding the House that the Select Committee report was unanimous. It was not produced capriciously; the Select Committee has taken a vast amount of evidence. We are still taking evidence and people are still talking to us about ring fencing. No doubt the hon. Member for Maidstone (Miss Widdecombe) would prefer that I make it clear that she was absent, but the rest of the Select Committee speak as one on the issue. That is significant, because I and my colleagues on the Select Committee do not agree on the generality of political matters, but on these issues we have been driven by the evidence before us which was so compelling.

Tonight, we have heard a great deal about freedom for local authorities when local authorities are under more pressure than ever before. My right hon. Friend the Member for Stoke-on-Trent (Mr. Ashley) referred to bad local authorities. However, with all due respect to him, that is not what we are discussing. We are acknowledging intolerable pressures on local authorities which are due in no small measure to the actions of the Government.

The Secretary of State spoke about making responsibilities for community care clearer, but we are not discussing making responsibilities clearer but putting extra responsibility on to the shoulders of local authorities and then being unwilling clearly to identify the funds which should accompany those responsibilities.

The Select Committee did not hesitate to say: we fear that local authority budgets for community care will be inadequate. One reason for this is the potential carry-forward of the current inadequate level of Social Security spending on residential care to local authorities' budgets for community care. Presumably, later tonight, we shall have the opportunity to vote on the inadequacy of funding for residential care.

The Select Committee is in no doubt that the budget for community care will be inadequate. Much has been made of the Association of County Councils, and I am sorry that it gave contradictory evidence. However, I remind the House that the ACC told the Committee: It is unlikely that the resources eventually identified by Government as the care element within the present income support allowances will begin to meet the additional cost of implementing the White Paper proposals. That is a strong quote. It is saying not that the money will not finish the job, but that it will not even begin to meet the requirements.

The Association of County Councils is not dominated by Labour members. Therefore, as—I almost said my hon. Friend—the hon. Member for Eastleigh (Sir D. Price) made clear, there is a mass agreement that the resources allocated to community care in pursuance of the White Paper should be protected, adequate and clearly identifiable, but none of those criteria will apply. The Government will have a convenient mechanism to say to local authorities, "Here is the job." They will tell the public that they are transferring resources for it, and then allow those resources to be swallowed up in the intolerable pressures on local authorities at present.

It is not even that the money may be used for education or other worthy objectives. Local authorities may be forced by Government action to use the funds to reduce the poll tax. There will be no protection against that. If the Government are serious in wanting an advance in community care, they should heed the words of the Select Committee, on which their Members have a majority, and the Lords amendment, which they should support.

Mr. Jack

I have listened carefully throughout the debate to the remarks made by Opposition and Conservative Members, and I am singularly amazed that we seem to be beginning to think that all problems in community care can be dealt with simply by ring-fencing a budget. It is far more important to discuss the quality of service of community care that can be delivered to elderly, mentally ill and physically handicapped people. That has a great deal to do with the quality of the management of social services in this country, not simply the mechanism by which a line is drawn round a number on a piece of paper.

I served for some time on the Mersey regional health authority and I distinctly remember that we had a debate about how to protect an element of the budget that we wanted to develop for services in the community. The choice as to how we protected that was determined by that health authority. We said that we would protect a certain element of the budget by ring fencing, but it was Mersey regional health authority's choice that we should do that. I do not understand why it is illogical to suggest that a responsible local authority would do the same.

One of the most powerful points today was made by my right hon. and learned Friend the Secretary of State, when he said that under the provisions of the Bill local authorities will be required to draw up a community care plan which will be open to inspection. That means that it will also be open to discussion. I am sure that some Opposition Members will join in the vigorous local debates which will place about how the priorities for care plans will be determined. That is the most powerful way in which local authorities can be compelled to carry out the responsibilities in their districts. That is what choice, debate, accountability and local democracy is about. All that we hear from Opposition Members is that, if the budget is ring-fenced, all those problems will be sorted out.

We have heard about the directors of social services. Those good people argued powerfully for the provisions of the Bill. They argued powerfully against the health authorities that they should have the responsibility for delivering care in the community. Ultimately, supported by Sir Roy Griffiths, the Government agreed with that point of view. The directors of social services argued that because they thought that they were in the best position to deliver that service. We have heard today that they are so in tune with their local authorities that they have written in large numbers to the hon. Member for Livingston (Mr. Cook) committing themselves to the concept of ring fencing.

11 pm

The directors of social services may be wrong, and they will probably lose the intellectual argument, but have they completely lost their powers of advocacy with the local authorities? We are told that they can carry the local authorities with them on ring fencing, so why cannot they carry the local authorities with them when it comes to seting the priorities for care? It would be a bold local authority which would completely abrogate its responsibilities in that area by pillaging the community care budget for a range of alternatives. I suspect that the pressure from the community will be the other way, and that the social services budget could benefit from savings in other parts of local authority budgets.

Those who advocate ring fencing have missed another dynamic. Let us consider, for instance, the situation where a facility for the mentally ill was being developed, perhaps a day care centre, which needed an access road. If no money was available in the highways budget for that, ring fencing—under the rigid terms proposed by the Opposition—might prevent a small transfer of resources from the community care budget to the highways budget to build that access road and thus enhance community care.

I may have had a go from time to time at my local authority in Lancashire because of the way it carries on, but at least it makes a genuine effort within its limited resources to carry out its social service responsibilities. So far as I can see, however, the quality of its ability to deliver that care depends far more on the skill of the managers and their perceptions of the particular problems than on the ring fencing of the budget. Ring fencing will not add to the efficient delivery of the service.

There is a strange view that ring fencing will overcome certain problems. I could understand that if the debate had been about the sum total of the community care budget and our social services, but it is not—it is about the mechanism for administering it.

The fundamental question is whether we trust local authorities to deliver the services. I am staggered by the Opposition's argument that on such a major programme local authorities could not be trusted to fight for the needs of local people. This is a real chance for local authorities to rehabilitate their image and prove that they can be responsible and accountable in delivering those services. That will be achieved by pressure from the local communities, not by ring-fencing particular budgets.

We live in an age of exciting opportunities in community care, but they will not be realised by ring-fencing the budget.

Mrs. Rosie Barnes (Greenwich)

I hope that I quote the Minister for Health correctly when I say that, speaking to the Select Committee on Social Services, she said: Ring-fencing … leads to … conservative, reactionary, fossilised provision of services. I would say that it would result in the sensitive, effective targeting of services. It certainly will not solve everything, but it would be a major step in the right direction. Without properly directed funding, community care may be no more than fine words.

While responsibility for care in the community is to be transferred to local authorities, proposed changes to income support and housing benefit for those in residential care homes and nursing homes are to be left to future legislation. According to the White Paper "Caring for People", local authorities may enter into contractual arrangements with independent providers and negotiate a price for a specific number of places, and the cost will be met by social services departments. Many places will be for the elderly; others will be for the mentally ill, the mentally handicapped and the physically disabled. Social services departments will have to estimate the likely demand for such places and assess the income of people who they have deemed will need such residential care. People receiving income support or housing benefit will have to hand over those benefits to social services departments, except for a small amount for their personal needs.

So far, so good: but no person in residential care should be better off than one cared for at home. That was an explicit intention of the Bill, and one with which I agree. However, having taken a person's income support and reimbursed the home up to the negotiated amount, the Government then say that the preferences of relatives and other carers should also be taken carefully into account. Unfortunately, that means that their financial cicumstances should be carefully taken into account.

The White Paper goes on to say: If relatives and friends wish, and are able, to make a contribution towards the cost of care, an individual may decide to look for a place in a more expensive home. Fair enough, but only as long as the basic provision is suitable and of a high basic standard.

Unless we have ring fencing, we run the risk of local authorities, under considerable financial pressure, choosing the cheapest homes available, and people will have to accept them because there is no alternative. Or, even worse, authorities will not be able to afford enough places, so many people needing residential care will have to remain at home by default because that will almost inevitably be the cheapest option.

Earlier, it was claimed that ring fencing would not be restrictive. I say that it would be: to restrict the money allocated for this purpose to the very people for whom it was intended is restrictive, but it is quite right. Without such ring fencing, community care and those in need of it would be in peril, and the provision of earmarked grants goes some way towards ensuring a minimum level of provision. That is all that we can expect.

It is not complicated to direct that the additional amount provided should be made specifically available for a certain purpose. I suspect that the amount of that money is at the root of the debate. If the amount can be concealed in the total grant, local authorities will carry the responsibility, not the Government.

There is no reason to encourage the perverse incentive to take up residential care rather than stay at home because of a financial inducement. But tonight we may be encouraging an alternative perverse incentive—obliging people in need of residential care to stay at home because the care is not available due to lack of resources or to a failure to earmark the resources.

Another great danger of this part of the Bill—it becomes all the more apparent without ring fencing—is that the professionals will make all the assessments and decisions. The people on the receiving end will have no choice, because the money will dictate what is available.

It is not a case of all or nothing. The Government have made it clear that they favour ring fencing in certain circumstances: for the mentally ill and for those with drug or alcohol problems. Recently, and in quite a different area, I had cause to make representations to the Home Secretary on behalf of the police, because savings in one department were not allowed to be transferred to another department in the police service. Ring fencing applies when it suits, but it does not suit on this occasion. We must inquire into that in more detail.

We are talking about provision that is already inadequate and at risk. In my constituency there is a two-year wait for an occupational therapist from social services to visit for an initial assessment of what is needed. That is for people who are severely ill with illnesses such as multiple sclerosis or who are suffering from the severe effects of a stroke. That is a two-year wait only for assessment, not for the treatment to be made available.

A resource centre was built in Greenwich for the physically disabled. People in a specific area agreed to forgo their children's playground in the interests of that centre. Because of lack of money within social services, the centre never opened and after being vandalised and refurbished at considerable expense, it was handed over to the directorate of housing for use as a hostel for the homeless. I would prefer it to be used for something rather than left empty, but that is an example of the decisions presently being made at local authority level.

All too often it is the disabled and the elderly—those who are in need of community care—who are the bottom of the pile and suffering. We must speak out for those people and I hope that, in winding up, the Minister for Health will reconsider this vital matter.

Mr. Robin Maxwell-Hyslop (Tiverton)

The Government Front Bench is rightly known as the Treasury Bench. The problem is not about good or bad local authorities, but that the Secretary of State for Health is himself ring-fenced. Other Ministers pour out legislation which imposes new statutory obligations—not discretionary duties—on local authorities. That is the nature of the problem. Even in the social services budget of many local authorities, an ever-increasing proportion—not just amount—has to be spent on meeting the new legal requirements of core cases. For example, the Children Bill has just gone through the House. As its requirements are mandatory on local authorities, in a sense they are ring-fenced. Those expenditures must be met. Another example is the national curriculum, the expense of which has been grossly underestimated by the Government.

We all know the phrase "taken into account". It does not mean "paid for". When new duties are imposed on local authorities we are assured that those duties will be taken into account the next time the standard spending assessment is calculated. It never means paid for. It always means a still greater claim on the resources of local authorities which is outwith the discretion and the priority judgments of the councillors who are elected to take decisions. Therefore, the Government constantly carry out ring fencing through the imposition of new statutory duties. It is that as much as anything which makes it necessary to ring-fence these functions of local government to protect it from the statutory obligations imposed by other Ministers.

The history of joint funding between the national health service and local government is certainly not a basis for confidence that ring fencing is unnecessary. In Devon, the area that is within my own knowledge, grant started a t 100 per cent., then became 50 per cent. and then became zero, and the lot had to come out of the resources of the county council. That is the pattern that we have seen so often no matter which Government are in office. The case for ring fencing does not impute incompetence, lack of good will or unwillingness by local authorities to take difficult decisions. All those allegations have been made this evening by those who are opposed to ring fencing.

11.15 pm

It must be acknowledged that local authorities are overwhelmed with statutory duties, and these duties continue to pour out from this place. My right hon. Friend the Prime Minister told me in a letter—as it is not marked private and confidential, it is a public document—that my right hon. Friend the Secretary of State for the Environment, not my right hon. and learned Friend the Secretary of State for Health, is responsible for monitoring all additional burdens that are placed on local government by central Government. I do not believe that he carries out that responsibility. I do not believe that he is capable of doing so.

Does my right hon. Friend have interdiction over new legislation on the inspection of food? Of course he does not. Indeed, my right hon. Friend the Secretary of State for the Environment is imposing new duties on local authorities that can be enforced by suing through the courts if there is garbage to be seen around. That is admirable environment protection, but the cost of it in rural areas, which spread out over a huge number of miles of road, could absorb the entire security budget unless there is ring fencing.

It is as much to protect my right hon. and learned Friend the Secretary of State for Health and his intentions from the actions of other members of the Government that we owe it to him to insist that Lords amendment No. 70 be upheld.

Mr. Kevin Barron (Rother Valley)

I was not a member of the Committee that considered the Bill, but I have watched its passage with some interest. I am interested especially in the funding of community care.

About 18 months ago, my mother-in-law died of Alzheimer's disease. The disease took over when she was in her 50s, and initially she was protected by her family to the greatest extent possible. Anyone who goes through the experience of looking after someone who has the disease knows that it is a traumatic time. That applies to the household and the wider family.

My mother-in-law went into an admirable private home in a neighbouring constituency. My wife and I visited dozens of homes to try to find one that could adequately look after her. Psychiatric help in private nursing homes is rare, and I am sad to say that my mother-in-law spent only a short time in the home. It was found that poor Nancy was disturbing others who had various forms of senile dementia and were not as active as she was. Consequently, she had to return home to be looked after by the family.

There were fortnightly periods of respite care when Nancy went to the local hospital. Those periods helped the family and, in a sense, many others. Nancy eventually went into long-term care within the area health authority, and died, sadly, nearly two years ago.

Before the events which I have outlined, I had discussed similar problems with my constituents, but I had never understood the true nature of them. I have a list in my office of other Nancys. They are at home and their families are still waiting for respite care for a couple of weeks. Those Nancys and their families are still waiting for long-term care within the area health authority.

The crisis had become embedded even before my personal experience. It is not the AHA's fault, because its resources are limited in this sector as they are in acute services. I do not know where acute services begin and end. It is not the fault of community psychiatric nurses, whose work load is far too high. It is not the fault of the social services. They do all that they can to help people who find themselves in circumstances similar to those experienced by my family. Some hon. Members have no knowledge of the true position.

About 12 months ago we hoped that some help would be forthcoming. Rotherham health authority was converting a maternity hospital in a neighbouring constituency into a home for the elderly which would have provided respite care for their families. However, the authority found earlier this year that it did not have sufficient resources to complete the conversion. The project will eventually be completed, but it will provide no relief for those who are now looking after elderly relatives. I have visited a number of homes where I found that some elderly people do not even recognise the members of the family who are looking after them. It was a joint project, funded by the health authority and Rotherham metropolitan borough council.

My brother is a councillor and sits on the social services committee. He understands the problems in his area and the implications of the lack of funding of community care. He knows that families desperately need care of that type.

The funding was withdrawn so that Rotherham would come within the original poll tax that was set for it. Today my authority lost its appeal in the High Court. It has been poll tax-capped to the tune of £7.9 million. That will lead to further cuts, both in my constituency and in other constituencies with similar problems.

Conservative Members say that the Lords amendment would lead to everything being ring-fenced, but we do not need to ring-fence education. We have not even begun to understand community care problems. The Bill as it stands provides us with an opportunity to do something about it. It is naive to say that the ring fencing of community care would lead to all other local authority expenditure being ring-fenced. The other place has produced a sensible amendment by saying that money should be ring fenced for community care. What does the standard spending assessment provide for people who are experiencing this terrible problem? I hope, therefore, that hon. Members will support the Lords amendment. It is the only way to tackle an urgent problem.

Mr. James Couchman (Gillingham)

The resources to be transferred to the local authorities are at present the resources of my ministerial master, and the conventions of the House in that regard led me to hesitate to participate in the debate. Having listened to Opposition Members' speeches, however, I feel it essential to say that I am astonished that they should be demanding the ring fencing of the transferred resources. I well remember, as a young chairman of social services serving on the London Boroughs Association, listening to that great doyen of London Labour politics, Sir Lou Sherman, talk of the rabbinical doctrine of non-specific grant and non-hypothecation. I remember just how precious was the principle that grant should not be ring-fenced as suggested in the Lords amendment.

To demand ring fencing shows a complete disregard for, and distrust of, local authorities. If I were cynical, I would say that the policy of ring fencing would allow local authorities to cease to spend the local resources that they spend on community care at present. It would allow them, perhaps, to transfer the cost of the home help service, or—the home care service, as it is in my county, and of meals on wheels—two services which represent community care at its best. If those costs were transferred, why should not local authorities transfer out of the local government budget the cost of social workers who work with the elderly?

I was amazed to hear the hon. Member for Preston (Mrs. Wise) suggest that local authorities might be pleased to use the money that is to be transferred to reduce their community charge.

Mrs. Wise

Will the hon. Gentleman give way?

Mr. Couchman

I shall not give way, because the debate is coming to an end.

I agree with my hon. Friend the Member for Hornchurch (Mr. Squire) that we have constrained local authorities too much in recent years. My hon. Friend the Member for Fylde (Mr. Jack) spoke of the faith that we should be placing in local authorities by transferring these responsibilities to them. We should let them be the lead authorities, and we should allow them some freedom in the way in which they manage the services.

Mr. McCartney

Talk some sense.

Mr. Couchman

Perhaps the hon. Gentleman would care to listen rather than talking through every speech that is made.

If we ring-fence this item, we may as well ring-fence every local government service. If we do that, we shall end up running local government from Whitehall, and we might just as well do away with all the social services authorities and with local authorities generally. The Government are entirely right to resist ring fencing, and I certainly have no difficulty in disagreeing with the Lords amendment.

Mr. Ieuan Wyn Jones

I am pleased to be able to participate in the debate, not least because the Lords amendment was piloted through the other place by Lord Allen of Abbeydale, who skilfully piloted my private Member's Bill through the House of Lords last year. If the success that was achieved on that occasion is to be repeated, we must hope that the House will accept the amendment.

The Government's main objection to the Lords amendment is that it would affect the decision-making powers of local authorities and remove their discretion to act. That comes a bit rich from a Government who have attacked local government services over the past few years. They have stripped local authorities of many of their powers. They have centralised their decision-making powers and curbed their right to raise finance.

I have not heard howls of anguish from local authorities that ring fencing would curb their powers. On the contrary, most local authorities—and especially the departments that would be particularly affected by the provisions—welcome the idea of having a defined sum of money which they know will be available to spend on care in the community.

In an interesting speech, the hon. Member for Hornchurch (Mr. Squire) said that local authorities should be given the responsibility to decide their own budgets, even if it involves making mistakes. We cannot talk about making mistakes in a vital service such as community care. Over the years, many mistakes have been made in the provision of community care, and they have affected people's lives. It is often a matter of life and death.

11.30 pm

It is not a matter of educating people; it is a matter of whether people live or die and whether the care that they are given will prolong their lives and enhance their quality of life. It is as important as that. That is why the case for ring fencing is unanswerable. We are talking about people's fundamental right to comfort and dignity.

Social services departments are under tremendous pressure. Day after day, statutory responsibilities are imposed on them, whether under the Children Act 1989 or the Education Reform Act 1988. All those responsibilities have resource implications. We must remember that, in the days of poll tax capping, local authorities will be put in the invidious position of having to make decisions and choices. We should not put them in that position. We should allow them to know exactly what resources are available to them at a given time.

Voluntary bodies that are responsible for the delivery of community care would welcome ring fencing. They know that, if they are properly to deliver care, they must know what resources are available at the beginning of each financial year. They must also know what resources are available to train volunteers to discharge their new responsibilities.

I suspect that the real reason why the Government do not want to ring-fence community care is because the sum would be in the open and we would all know what the Government propose to spend in a certain year. We would then be able to identify the cash that would be allocated. The Government's problem is that we would then know that the allocation would be totally inadequate.

It is not right that the Government should adopt a Pontius Pilate approach to local authorities and say, "Here is an amount of money for you. You spend it in the way you think desirable." It will not work like that. The case for ring fencing is unanswerable. The most trenchant and compelling case for ring fencing was made by Sir Roy Griffiths in his report. The Government refuse to accept that recommendation, because of the resource implications that it involves. If the Government and the Treasury are not prepared to accept that recommendation, I hope that hon. Members will support it.

Mr. Roger Sims (Chislehurst)

I hesitate to trespass on the limited time to discuss this matter, but I am especially concerned about it. I was a member of the Standing Committee and also a signatory to the Select Committee report. I am concerned about the lump sum that is to be transferred to local authorities which are having great difficulty in planning to implement the Bill without knowing what money they will have to do so.

In response to the Select Committee's second report, the Government specifically said: It has always been the Government's intention to calculate and transfer to local authorities the amount of social security expenditure that would have been available as a contribution to the care costs". That would suggest a straightforward calculation. In reply to my recent question, the Secretary of State said that the figure will not be available until the end of the public expenditure round. It is nothing to do with the public expenditure round; it should be possible to calculate the figure exactly and to give local authorities some idea of the sums that will be available.

Having listened to the ring-fencing arguments advanced in Committee and on the Floor of the House, I find them fairly evenly balanced. In favour of ring fencing is the argument that local social services committees will have adequate funds to carry out their responsibilities, and that, without it, funds allocated by central Government may be used for other purposes, which may or may not be less worthy than community care.

The argument against ring fencing is that, as my hon. Friend the Minister said, social services committees fight their corners pretty well and usually get a pretty good share of the local authority budget. If money is ring-fenced, when proposals are made by social service committees, local authorities may say, "You have had your lump sum; that is what the Government said you can have, and we are not willing to allocate further funds."

Another argument against ring fencing is that it restricts local authorities' initiatives. When proposing ring fencing for community care, one must specify precisely what is meant by community care, because otherwise it is meaningless. That must, by its nature, be restrictive.

People hold different views on the issue. In the past couple of days, I have spoken to two directors of social services who do not advocate ring fencing. They have many bright ideas and initiatives that they want to, introduce under the flexibility that the Bill offers, but they fear that ring fencing may restrict what they can do.

A few days ago, I was talking to some housing association officials, who said, "I hope you will not support ring fencing," and proceeded to tell me about certain housing initiatives that they want to implement. They fear that ring fencing would have to be so specific that they would not be free to implement those proposals.

The hon. Member for Preston (Mrs. Wise) referred to some of the schemes that the Select Committee on Social Services saw abroad. They were interesting, and no doubt they will feature in our reports. Will they fall in the precise categories of ring-fenced community care that will be laid down if the Lords amendment is accepted? I give only one example. It was interesting to find that community care officers in Italy give old-age pensioners allotments. They think that it is rather a good idea, and therapeutic, for elderly gentlemen who live in flats in towns to be bussed out to their allotments. I think that we probably agree that it is quite a good idea, and it would certainly fall within our idea of community care, but would it be specified in the legislation?

The danger is that some good ideas may be advanced, and many people may say, "That is what we mean by community care," but they may not meet the requirements for ring fencing. I should have been happier if Ministers had been more forthcoming about the sums that will be available to local authorities and had assured us that they will be adequate. However, it can be argued that, within the philosophy enshrined in the Bill, there should be flexibility for local authorities in administering community care and, in the circumstances, I am willing to give Ministers the benefit of the doubt.

Mr. Tom Clarke

This interesting and, in some ways, compelling debate has reflected the opinion of many parts of the country. Hon. Members on both sides have given clear support to the House of Lords decision and the view of many important bodies and, in particular, of Sir Roy Griffiths that we shall not get these matters right unless we take on board the important principle of earmarking the inevitably limited resources available. I am sure that my hon. Friends will agree that the hon. Members for Eastleigh (Sir D. Price) and for Tiverton (Mr. Maxwell-Hyslop) put the case clearly and strongly without any element of overstatement. What they said invited the support of the majority of the House.

The issues are so grave that the House, in the latter stages of considering the Bill, would do a grave disservice to the Griffiths report if, while we endorsed the principles and accepted that something should be done about the cares which the Audit Commission and Sir Roy Griffiths identified, we pulled back from the inevitable conclusion that the resources which are supposed to be made available for the most vulnerable people in our society were in some cases being spent on other purposes. That would be indefensible.

There is no challenge to a principle which the Government have said is sacred. They have already accepted that a clear case exists for earmarking funds for the mentally ill, and for drug abuse and alcoholism. We are arguing that the evidence is so overwhelming that there should be ring fencing for community care and that the House has an important responsibility to respond to that evidence, if only because it may be a long time before we have an opportunity to reconsider these matters.

Their Lordships reached the right conclusion. The Select Committee—its report has been quoted extensively by hon. Members on both sides—having examined these matters in great detail, was right to make the recommendation that it did. It is a matter for regret that when the Bill was last before the House, we did not have the opportunity to discuss the report. We have the opportunity now to debate and act on it, and we should do so.

The Secretary of State was not right in everything he said at the start of the debate, but as an ex-president of the Convention of Scottish Local Authorities, I readily concede one point—that local authorities have not always been keen or enthusiastic about earmarking funds in this way. Certainly when I was active in COSLA that was the position. We can understand the reasons for that. I plead with the Secretary of State and the House to consider seriously why local authorities have changed their minds, as they would admit, on such a fundamental issue. It is because they are so worried about the issues they face.

It is not simply a question of arguing for education or transport or whatever to be ring-fenced. Local authorities are dealing with an enormous problem. Principal among the many issues facing them is what is described as the demographic time bomb. Happily, many people are now living to a ripe old age, but that presents great problems for local authorities, for the Government, the House and the Treasury. Community care and social services are distinguished from other functions by the Government's decision, which the Secretary of State warmly endorsed today, that funding from the Department of Social Security should be switched to local government, which should then be responsible for making the resources available to clients. As a principle, that is almost without precedent. The Secretary of State cannot disregard such an important decision and such an important recommendation.

If we consider the way in which the funds have been administered so far, in the absence of earmarking, the House cannot have the confidence to say that all the money will be allocated in the way that we would wish. There is no evidence to believe that.

11.45 pm

Mr. Nicholas Winterton

Does not the hon. Gentleman think it extremely strange that the Government are almost on their own in opposing ring fencing and are forcing additional responsibilities on local government without specifying the amount of resources that they are prepared to allocate for those very vulnerable people who cannot represent their own best interests?

Mr. Clarke

The hon. Gentleman is right. I hope that I can say with some humility that I have attended seminars and conferences around the country and I cannot remember any occasion when the majority of those present did not agree with the view that the hon. Gentleman has just expressed.

When local authorities consider their responsibilities, they must distinguish between competing priorities. The House decided that the Children Act 1989 should be written into the statute book. That was a very important measure and it reflected the concern of the House about the grave issue of child abuse. However, in the absence of ring fencing, social service departments may have to choose between allocating money to that purpose or allocating it to the elderly, the disabled, the carers or the mentally handicapped. I do not believe that that decision should be left so vague in the light of our discussions and the advice of people such as Sir Roy Griffiths and the Select Committee.

We have also had debates about environmental health. Local authorities must make a choice and take a decision. The record in identifying where that money is going in social services is quite appalling. Under the Disabled Persons (Services, Consultation and Representation) Act 1986, the Department of Health's inspectorate published a report in January which showed that, in one authority, at least, some of the resources got lost. Given the limited resources available for those purposes, we do not believe that any money should simply get lost.

Towards the end of this all too brief debate, the House would be extremely foolish to disregard the carefully taken decision of another place. It would be foolish also to disregard the overwhelming view of local authorities and the almost unanimous view of those in social services. We have not got things right so far, and if on this occasion we ignore the advice of another place, I believe that chaos will prevail and we shall have no excuse.

Mrs. Virginia Bottomley

This has been an important and lengthy debate on the crucial question of funding the policies of care in the community. As my right hon. and learned Friend the Secretary of State made only too clear, those policies are popular and important. To implement them, we have been carrying out a major programme with local authorities, voluntary organisations and others who are concerned about care in the community so that we can talk through the practical realities. Although I understand why ring fencing has emerged as a major issue today, I wish that we could have spent a similar amount of time on some of the details of the change in culture, the work that must be undertaken, and the different ways of looking at care in the community. It is not merely a question of ring fencing.

My right hon. and learned Friend put the Government's view on ring fencing at the beginning of this debate. We believe that ring fencing serves to undermine local government accountability. Where large sums of money are involved—we are talking about hundreds of millions of pounds in the transfer of resources from social security to local authority spending—it is both wrong and inappropriate to ring-fence those resources, for the reasons that were so forcefully and clearly expressed by many of my hon. Friends, including my hon. Friends the Members for Mid-Kent (Mr. Rowe), for Fylde (Mr. Jack) and for Hornchurch (Mr. Squire). Many of my hon. Friends spoke ably from positions of authority.

However, we see a need for specific grants in areas where there has been an inadequacy of provision. The mental illness specific grant is a good example. A mere 3 per cent. of local government spending is directed towards mental illness. As my right hon. and learned Friend again made clear, that is an area in which the integration of services from the health authority and the local authority is of fundamental importance. By having that strategic specific grant and ensuring that the health authority must give approval for that grant, we can ensure that good working relationships are properly established. Mental illness spending contrasts with the 8 per cent. spending on mental handicap.

Similarly, we use specific grants for training. We target provision on training for the requirements of the Children Act 1989 and on the establishment of services for AIDS patients, all of which meets with the approval of the House. That is why my right hon. and learned Friend's amendment is so important. Specific grant should be available for those who are drug addicts of alcoholics. That point was made at length in Committee and at other stages of the Bill's passage. We have considered it carefully and have held meetings with many voluntary organisations and others involved.

That is a typical example of the way in which the Government have treated the proposals for care in the community. We have discussed and scrutinised. Where the force of the argument has made it clear that we should modify our proposals, we have been only too willing to do so. However, I am afraid that we are not convinced by the arguments on overall ring fencing—in spite of the important points made by many distinguished right hon. and hon. Members for whom I have the highest regard on this matter.

My hon. Friend the Member for Ealing, Acton (Sir G. Young) referred to the areas where there are statutory requirements for the local authority to undertake tasks. It was his arguments in Committee, when he made precisely that point, that led us to accept many of the amendments that he sought. Many aspects of care in the community were to be the subject of guidance and were not to be written on the face of the Bill. It was my hon. Friend's concern about complaints, about the requirement to consult housing and health authorities, and his concern that that should be written on the face of the Bill rather than in guidance that won the day and convinced us.

However, the statutory requirements are nowhere near as inconsiderable as he has sought to suggest. Local authorities will be under a duty to prepare and publish plans for community care, and to consult carers' organisations and users—quite apart from the health and housing departments and the voluntary organisations. They are under a duty to assess for community care services; to exercise social services functions in accordance with directives given by the Secretary of State, and they are under the very important duty to establish a complaints procedure, because ensuring proper quality for the individuals who are subject to community care is a fundamental requirement.

Mr. William McKelvey (Kilmarnock and Loudoun)

Why are the Government so determined not to ring-fence, when the money for the disabled given to Gloucester was spent entirely on road improvements? That is why we suspect that councils will not channel the money in the right direction.

Mrs. Virginia Bottomley

If the hon. Gentleman had been present when my right hon. and learned Friend made his speech, he would have the answer to his question. Personal social services departments have increased their spending by 37 per cent. compared with other departments in local government. They have had no difficulty in fighting their corner and that is a strong argument for not promoting ring fencing.

Local authorities are under a statutory duty to provide services for those who need community care. HonMembers have properly raised the need for local authorities to have some sense of anticipation about what the likely sum of the resources will be. As my right hon. and learned Friend said, we are having further discussions with the Department of Social Security about that substantial sum which will go directly to local authorities. We are also having detailed discussions with local authority associations about what they anticipate the likely needs will be arising from the new proposals.

I accept what my hon. Friend the Member for Tiverton (Mr. Maxwell-Hyslop) said about the increasing areas of responsibility for local government, for example, educational provision arising from the Children Act 1989 and provisions relating to legislation on food. As soon as we can, we shall make clear the precise nature of the sums involved.

We have been able to issue our draft guidance for consultation on plans, inspections, case management and the complaints procedure. They are all subject to consultation, and we look to learn from that.

My hon. Friend the Member for Mid-Kent spoke eloquently about the disadvantages of ring fencing and the House should note the important points that he raised. My hon. Friend represents an authority that has a particularly enlightened policy of care in the community. I have met some of the care managers of Kent and I was impressed by the way in which they made difficult decisions about the right way to provide for the frail and vulnerable.

My hon. Friend seeks to provide that some scheme of empowerment is available to the disabled. He will be aware that in Committee I shared the aspirations behind such a measure. I expressed reservations about whether it would be possible to introduce a workable proposal within the time. I visited a scheme in Hampshire to talk to the severely disabled, those with spinal injuries, who were, with a system of empowerment, able to live independent lives and have effective control over their own budgets. However, within the time it has not been possible to introduce a proposal to meet those aims. I urge my hon. Friend to withdraw the amendment and I agree to work with him to see whether it is possible to achieve a workable proposal at a later date.

My hon. Friend the Member for Bolton, North-East (Mr. Thurnham) has particular knowledge and expertise about care in the community. In Bolton, one of the pilot projects that we set up to develop ideas for care in the community reached a successful conclusion. I greatly appreciate my hon. Friend's comments, because addressing the development of a mixed economy of care and the provision of choice and dignity to the individual is important. My hon. Friend is right in saying that voluntary homes provide more cost-effective care than local authority alternatives. Such are the challenges we must face.

The hon. Member for Greenwich (Mrs. Barnes) spoke about the nature of the incentive. She will understand that the current incentive is all towards placing the frail and the vulnerable in institutions. My right hon. Friend the Secretary of State for Social Security then finances the provision of that care, which presents no difficulty to the social services budget.

The challenge of care in the community is to work with the financial incentives to provide day care alternatives to residential care and, above all, to incorporate the needs and the interests of the users and the carers. Never before have proposals been brought forward which so clearly and forcefully recognise their particular needs and interests.

Mrs. Rosie Barnes

Does not the Minister agree that ring fencing will ensure those choices and that redistribution of funds? Most hon. Members would like the choice of residential care or care at home to be available. Such a choice cannot be made for the right reasons unless the money is available, and that involves ring fencing.

12 midnight

Mrs. Bottomley

It is quite clear that ring fencing is not productive to the innovative thought that we want to go into community care. The challenge for local authorities is to respond to the new framework for the next decade and beyond. It is an important opportunity to which we are committed, working with local authorities to ensure that they can undertake those important tasks. We have announced an important specific grant in a category where there has been concern. We have met that concern, but we have always said that adequate resources will be available for local authorities to undertake their important new tasks. I urge my hon. Friends to reject the Lords amendment and to support Government amendment (b).

Mr. Rowe

The Minister has pledged to work with me to find a workable solution to the problem that I posed. I shall hold her to that commitment, and on those terms I beg to ask leave to withdraw my amendment (a) to the Lords amendment.

Amendment to the Lords amendment, by leave, withdrawn.

It being eight hours after the commencement of proceedings on the Order [27 June] relating to the National Health Service and Community Care Bill (Allocation of Time) MR. DEPUTY SPEAKER proceeded, pursuant to the said Order, to put forthwith the Question, That this House doth disagree with the Lords in the said amendment—[Mr. Kenneth Clarke.]

Question put:—

The House divided: Ayes 312, Noes 238.

Division No. 269]	[12.1 am
AYES
Adley, Robert	Brooke, Rt Hon Peter
Aitken, Jonathan	Brown, Michael (Brigg & Cl't's)
Alexander, Richard	Bruce, Ian (Dorset South)
Alison, Rt Hon Michael	Buck, Sir Antony
Allason, Rupert	Burns, Simon
Amess, David	Burt, Alistair
Amos, Alan	Butcher, John
Arbuthnot, James	Butler, Chris
Arnold, Jacques (Gravesham)	Butterfill, John
Arnold, Sir Thomas	Carlisle, John, (Luton N)
Ashby, David	Carlisle, Kenneth (Lincoln)
Atkins, Robert	Carrington, Matthew
Atkinson, David	Carttiss, Michael
Baker, Rt Hon K. (Mole Valley)	Cash, William
Baker, Nicholas (Dorset N)	Chalker, Rt Hon Mrs Lynda
Baldry, Tony	Channon, Rt Hon Paul
Banks, Robert (Harrogate)	Chapman, Sydney
Batiste, Spencer	Chope, Christopher
Bellingham, Henry	Clark, Hon Alan (Plym'th S'n)
Bennett, Nicholas (Pembroke)	Clark, Dr Michael (Rochford)
Benyon, W.	Clarke, Rt Hon K. (Rushcliffe)
Bevan, David Gilroy	Colvin, Michael
Biffen, Rt Hon John	Conway, Derek
Blackburn, Dr John G.	Coombs, Anthony (Wyre F'rest)
Blaker, Rt Hon Sir Peter	Coombs, Simon (Swindon)
Body, Sir Richard	Cope, Rt Hon John
Bonsor, Sir Nicholas	Couchman, James
Boscawen, Hon Robert	Cran, James
Boswell, Tim	Critchley, Julian
Bottomley, Peter	Currie, Mrs Edwina
Bottomley, Mrs Virginia	Davies, Q. (Stamf'd & Spald'g)
Bowden, A (Brighton K'pto'n)	Davis, David (Boothferry)
Bowden, Gerald (Dulwich)	Devlin, Tim
Bowis, John	Dickens, Geoffrey
Boyson, Rt Hon Dr Sir Rhodes	Dicks, Terry
Braine, Rt Hon Sir Bernard	Dorrell, Stephen
Brandon-Bravo, Martin	Douglas-Hamilton, Lord James
Brazier, Julian	Dover, Den
Bright, Graham	Dunn, Bob

Dykes, Hugh	King, Rt Hon Tom (Bridgwater)
Emery, Sir Peter	Kirkhope, Timothy
Evans, David (Welwyn Hatf'd)	Knapman, Roger
Evennett, David	Knight, Greg (Derby North)
Fairbairn, Sir Nicholas	Knowles, Michael
Fallon, Michael	Knox, David
Favell, Tony	Lamont, Rt Hon Norman
Fenner, Dame Peggy	Lang, Ian
Field, Barry (Isle of Wight)	Latham, Michael
Finsberg, Sir Geoffrey	Lawson, Rt Hon Nigel
Fishburn, John Dudley	Lee, John (Pendle)
Forman, Nigel	Leigh, Edward (Gainsbor'gh)
Forsyth, Michael (Stirling)	Lennox-Boyd, Hon Mark
Fowler, Rt Hon Sir Norman	Lester, Jim (Broxtowe)
Fox, Sir Marcus	Lilley, Peter
Franks, Cecil	Lloyd, Sir Ian (Havant)
Freeman, Roger	Lloyd, Peter (Fareham)
French, Douglas	Lord, Michael
Fry, Peter	Luce, Rt Hon Richard
Gale, Roger	Lyell, Rt Hon Sir Nicholas
Gardiner, George	Macfarlane, Sir Neil
Garel-Jones, Tristan	MacGregor, Rt Hon John
Gill, Christopher	MacKay, Andrew (E Berkshire)
Glyn, Dr Sir Alan	Maclean, David
Goodlad, Alastair	McLoughlin, Patrick
Goodson-Wickes, Dr Charles	McNair-Wilson, Sir Michael
Gorman, Mrs Teresa	McNair-Wilson, Sir Patrick
Gorst, John	Madel, David
Gow, Ian	Major, Rt Hon John
Grant, Sir Anthony (CambsSW)	Malins, Humfrey
Greenway, Harry (Ealing N)	Mans, Keith
Greenway, John (Ryedale)	Maples, John
Gregory, Conal	Marland, Paul
Griffiths, Sir Eldon (Bury St E')	Marlow, Tony
Griffiths, Peter (Portsmouth N)	Marshall, John (Hendon S)
Grist, Ian	Marshall, Sir Michael (Arundel)
Ground, Patrick	Martin, David (Portsmouth S)
Grylls, Michael	Maude, Hon Francis
Gummer, Rt Hon John Selwyn	Mayhew, Rt Hon Sir Patrick
Hague, William	Mellor, David
Hamilton, Hon Archie (Epsom)	Miller, Sir Hal
Hamilton, Neil (Tatton)	Mills, Iain
Hampson, Dr Keith	Miscampbell, Norman
Hanley, Jeremy	Mitchell, Andrew (Gedling)
Hargreaves, A. (B'ham H'll Gr')	Mitchell, Sir David
Hargreaves, Ken (Hyndburn)	Moate, Roger
Harris, David	Monro, Sir Hector
Haselhurst, Alan	Montgomery, Sir Fergus
Hayward, Robert	Moore, Rt Hon John
Heathcoat-Amory, David	Morrison, Sir Charles
Heseltine, Rt Hon Michael	Morrison, Rt Hon P (Chester)
Hicks, Mrs Maureen (Wolv NE)	Moss, Malcolm
Hicks, Robert (Cornwall SE)	Moynihan, Hon Colin
Hill, James	Neale, Gerrard
Hind, Kenneth	Needham, Richard
Hogg, Hon Douglas (Gr'th'm)	Nelson, Anthony
Holt, Richard	Neubert, Michael
Hordern, Sir Peter	Newton, Rt Hon Tony
Howard, Rt Hon Michael	Nicholls, Patrick
Howarth, Alan (Strat'd-on-A)	Nicholson, David (Taunton)
Howarth, G. (Cannock & B'wd)	Nicholson, Emma (Devon West)
Howe, Rt Hon Sir Geoffrey	Norris, Steve
Howell, Rt Hon David (G'dford)	Onslow, Rt Hon Cranley
Howell, Ralph (North Norfolk)	Oppenheim, Phillip
Hughes, Robert G. (Harrow W)	Page, Richard
Hunt, David (Wirral W)	Paice, James
Hunt, Sir John (Ravensbourne)	Parkinson, Rt Hon Cecil
Hunter, Andrew	Patnick, Irvine
Hurd, Rt Hon Douglas	Patten, Rt Hon John
Irvine, Michael	Pattie, Rt Hon Sir Geoffrey
Irving, Sir Charles	Pawsey, James
Jack, Michael	Peacock, Mrs Elizabeth
Jackson, Robert	Porter, Barry (Wirral S)
Janman, Tim	Porter, David (Waveney)
Jessel, Toby	Portillo, Michael
Johnson Smith, Sir Geoffrey	Raison, Rt Hon Timothy
Jones, Robert B (Herts W)	Redwood, John
Jopling, Rt Hon Michael	Renton, Rt Hon Tim
Key, Robert	Riddick, Graham
King, Roger (B'ham N'thfield)	Ridley, Rt Hon Nicholas

Ridsdale, Sir Julian	Taylor, Ian (Esher)
Rifkind, Rt Hon Malcolm	Taylor, John M (Solihull)
Roberts, Wyn (Conwy)	Taylor, Teddy (S'end E)
Roe, Mrs Marion	Tebbit, Rt Hon Norman
Rost, Peter	Temple-Morris, Peter
Rowe, Andrew	Thompson, D. (Calder Valley)
Rumbold, Mrs Angela	Thompson, Patrick (Norwich N)
Ryder, Richard	Thornton, Malcolm
Sackville, Hon Tom	Thurnham, Peter
Sainsbury, Hon Tim	Townsend, Cyril D. (B'heath)
Shaw, David (Dover)	Tracey, Richard
Shaw, Sir Giles (Pudsey)	Tredinnick, David
Shaw, Sir Michael (Scarb')	Trippier, David
Shelton, Sir William	Trotter, Neville
Shephard, Mrs G. (Norfolk SW)	Twinn, Dr Ian
Shepherd, Colin (Hereford)	Vaughan, Sir Gerard
Shepherd, Richard (Aldridge)	Viggers, Peter
Shersby, Michael	Waddington, Rt Hon David
Sims, Roger	Wakeham, Rt Hon John
Skeet, Sir Trevor	Waldegrave, Rt Hon William
Smith, Sir Dudley (Warwick)	Walden, George
Smith, Tim (Beaconsfield)	Walker, Bill (T'side North)
Soames, Hon Nicholas	Waller, Gary
Speller, Tony	Ward, John
Spicer, Sir Jim (Dorset W)	Wardle, Charles (Bexhill)
Spicer, Michael (S Worcs)	Warren, Kenneth
Squire, Robin	Wells, Bowen
Stanbrook, Ivor	Wheeler, Sir John
Stanley, Rt Hon Sir John	Whitney, Ray
Steen, Anthony	Widdecombe, Ann
Stern, Michael	Wiggin, Jerry
Stevens, Lewis	Wilshire, David
Stewart, Allan (Eastwood)	Wood, Timothy
Stewart, Andy (Sherwood)	Woodcock, Dr. Mike
Stewart, Rt Hon Ian (Herts N)	Yeo, Tim
Stradling Thomas, Sir John
Sumberg, David	Tellers for the Ayes:
Summerson, Hugo	Mr. Tony Durant and
Tapsell, Sir Peter	Mr. David Lightbown.

NOES
Adams, Allen (Paisley N)	Clay, Bob
Allen, Graham	Clelland, David
Alton, David	Clwyd, Mrs Ann
Anderson, Donald	Cohen, Harry
Archer, Rt Hon Peter	Coleman, Donald
Armstrong, Hilary	Cook, Frank (Stockton N)
Ashdown, Rt Hon Paddy	Cook, Robin (Livingston)
Ashley, Rt Hon Jack	Corbett, Robin
Ashton, Joe	Corbyn, Jeremy
Banks, Tony (Newham NW)	Cousins, Jim
Barnes, Harry (Derbyshire NE)	Cox, Tom
Barnes, Mrs Rosie (Greenwich)	Crowther, Stan
Barron, Kevin	Cryer, Bob
Beckett, Margaret	Cummings, John
Bell, Stuart	Cunliffe, Lawrence
Benn, Rt Hon Tony	Cunningham, Dr John
Bennett, A. F. (D'nt'n & R'dish)	Dalyell, Tam
Bermingham, Gerald	Darling, Alistair
Bidwell, Sydney	Davies, Rt Hon Denzil (Llanelli)
Blair, Tony	Davies, Ron (Caerphilly)
Blunkett, David	Davis, Terry (B'ham Hodge H'I)
Boateng, Paul	Day, Stephen
Boyes, Roland	Dewar, Donald
Bradley, Keith	Dixon, Don
Brown, Gordon (D'mline E)	Dobson, Frank
Brown, Nicholas (Newcastle E)	Doran, Frank
Brown, Ron (Edinburgh Leith)	Duffy, A. E. P.
Bruce, Malcolm (Gordon)	Dunnachie, Jimmy
Buckley, George J.	Dunwoody, Hon Mrs Gwyneth
Caborn, Richard	Eastham, Ken
Callaghan, Jim	Evans, John (St Helens N)
Campbell, Menzies (Fife NE)	Ewing, Harry (Falkirk E)
Campbell, Ron (Blyth Valley)	Ewing, Mrs Margaret (Moray)
Campbell-Savours, D. N.	Fatchett, Derek
Canavan, Dennis	Fearn, Ronald
Carlile, Alex (Mont'g)	Field, Frank (Birkenhead)
Carr, Michael	Fields, Terry (L'pool B G'n)
Clark, Dr David (S Shields)	Fisher, Mark
Clarke, Tom (Monklands W)	Flannery, Martin

Flynn, Paul	Michie, Bill (Sheffield Heeley)
Foot, Rt Hon Michael	Michie, Mrs Ray (Arg'l & Bute)
Foster, Derek	Mitchell, Austin (G't Grimsby)
Foulkes, George	Moonie, Dr Lewis
Fraser, John	Morgan, Rhodri
Fyfe, Maria	Morley, Elliot
Galloway, George	Morris, Rt Hon A. (W'shawe)
Gilbert, Rt Hon Dr John	Morris, Rt Hon J. (Aberavon)
Godman, Dr Norman A.	Morris, M (N'hampton S)
Gould, Bryan	Mowlam, Marjorie
Graham, Thomas	Mullin, Chris
Grant, Bernie (Tottenham)	Murphy, Paul
Griffiths, Nigel (Edinburgh S)	Nellist, Dave
Griffiths, Win (Bridgend)	Oakes, Rt Hon Gordon
Grocott, Bruce	O'Brien, William
Hardy, Peter	O'Neill, Martin
Harman, Ms Harriet	Orme, Rt Hon Stanley
Hattersley, Rt Hon Roy	Parry, Robert
Hayes, Jerry	Patchett, Terry
Heal, Mrs Sylvia	Pendry, Tom
Henderson, Doug	Pike, Peter L.
Hinchliffe, David	Powell, Ray (Ogmore)
Hoey, Ms Kate (Vauxhall)	Prescott, John
Hogg, N. (C'nauld & Kilsyth)	Price, Sir David
Hood, Jimmy	Primarolo, Dawn
Howarth, George (Knowsley N)	Quin, Ms Joyce
Howell, Rt Hon D. (S'heath)	Randall, Stuart
Howells, Geraint	Redmond, Martin
Howells, Dr. Kim (Pontypridd)	Rees, Rt Hon Merlyn
Hoyle, Doug	Reid, Dr John
Hughes, John (Coventry NE)	Richardson, Jo
Hughes, Robert (Aberdeen N)	Robertson, George
Hughes, Roy (Newport E)	Robinson, Geoffrey
Hughes, Simon (Southwark)	Rogers, Allan
Illsley, Eric	Rooker, Jeff
Ingram, Adam	Ross, Ernie (Dundee W)
Janner, Greville	Ross, William (Londonderry E)
Johnston, Sir Russell	Rowlands, Ted
Jones, Barry (Alyn & Deeside)	Ruddock, Joan
Jones, Ieuan (Ynys Môn)	Salmond, Alex
Jones, Martyn (Clwyd S W)	Sheerman, Barry
Kaufman, Rt Hon Gerald	Sheldon, Rt Hon Robert
Kellett-Bowman, Dame Elaine	Shore, Rt Hon Peter
Kennedy, Charles	Short, Clare
Kilfedder, James	Sillars, Jim
Kinnock, Rt Hon Neil	Skinner, Dennis
Kirkwood, Archy	Smith, Andrew (Oxford E)
Lambie, David	Smith, C. (Isl'ton & F'bury)
Lamond, James	Smith, Rt Hon J. (Monk'ds E)
Leadbitter, Ted	Soley, Clive
Leighton, Ron	Spearing, Nigel
Lewis, Terry	Steel, Rt Hon Sir David
Litherland, Robert	Steinberg, Gerry
Livingstone, Ken	Stott, Roger
Livsey, Richard	Strang, Gavin
Lloyd, Tony (Stretford)	Straw, Jack
Lofthouse, Geoffrey	Taylor, Mrs Ann (Dewsbury)
Loyden, Eddie	Taylor, Matthew (Truro)
McAllion, John	Thomas, Dr Dafydd Elis
McAvoy, Thomas	Thompson, Jack (Wansbeck)
McCartney, Ian	Turner, Dennis
Macdonald, Calum A.	Vaz, Keith
McKay, Allen (Barnsley West)	Wallace, James
McKelvey, William	Walley, Joan
McLeish, Henry	Wareing, Robert N.
McNamara, Kevin	Watson, Mike (Glasgow, C)
Madden, Max	Welsh, Andrew (Angus E)
Mahon, Mrs Alice	Welsh, Michael (Doncaster N)
Marek, Dr John	Wigley, Dafydd
Marshall, David (Shettleston)	Williams, Rt Hon Alan
Marshall, Jim (Leicester S)	Williams, Alan W. (Carm'then)
Martin, Michael J. (Springburn)	Wilson, Brian
Martlew, Eric	Winnick, David
Maxton, John	Winterton, Mrs Ann
Maxwell-Hyslop, Robin	Winterton, Nicholas
Meacher, Michael	Wise, Mrs Audrey
Meale, Alan	Wolfson, Mark
Meyer, Sir Anthony	Worthington, Tony
Michael, Alun	Wray, Jimmy

Young, David (Bolton SE)	Tellers for the Noes:
Young, Sir George (Acton)	Mr. Frank Haynes and
	Mrs. Llin Golding.

Question accordingly agreed to.

Lords amendment No. 70 disagreed to.

Amendments made to the Bill in lieu thereof: (b), in clause 46, page 53, line 18, after 'incurred', insert (a)'.

(c), in page 53, line 20, at end insert or (b) in making payments, in accordance with directions given by the Secretary of State to voluntary organisations which provide care and services for persons who are, have been, or are likely to become dependent upon alcohol or drugs.'.—[Mr. Kenneth Clarke.]