Community Charge (Hansard, 18 February 1991)

§ 2. Mr. Wigley
To ask the Secretary of State for Wales what discussions he has had with local authorities in Wales concerning the future of the community charge.

§ The Secretary of State for Wales (Mr. David Hunt)
On 7 January I met representatives of the district and county councils at a meeting of the Welsh consultative council on local government finance to discuss local government finance structure and functions.

§ Mr. Wigley
Will the Secretary of State join me in congratulating those people in Wales who have campaigned hard and long against the poll tax, often at great personal cost? Will he assure the House that when a replacement tax takes over from the poll tax, as it must, the new tax will take into account the cost of administration and that it will be substantially less than the very high bureaucratic cost of the poll tax?

§ Mr. Hunt
I do not join the hon. Gentleman in what he asks, but he did not expect that I would. However, I very much look forward to meeting him and his colleagues, as 3 well as senior representatives of the Liberal Democrats, in the next few days to discuss this thorough, wide-ranging and constructive review of the community charge. My great regret is that the official Opposition have yet to respond positively.

§ Sir Anthony Meyer
My right hon. Friend has done astonishingly well to enable councils in Wales to keep the level of the community charge so much lower than in England, but is he aware of not only the puzzlement but the resentment about the system whereby he has been able to secure so much extra money for rebates to communities? I do not know whether my right hon. Friend has anything to say on the subject, but I should be glad if he would at least say that he is well aware of that ill feeling.

§ Mr. Hunt
Of course, I considered whether we might introduce the English form of transitional relief. I was responsible for formulating it for England. However, there were two reasons why that was not possible. First, it would have taken a great deal of time and administration to introduce. Secondly, I should not have been able to get the relief to as many people as I have. According to my predictions, if the English scheme had applied in Wales, it would have gone to I million people and amounted to £50 million worth of transitional relief. As it is, the relief will go to 1.4 million people and will amount to £62 million.

§ Mr. Flynn
Is the Secretary of State aware that Newport's council and its people are bewildered by the perverse effects of the rebate, whereby most prosperous areas get a hand-out and most of the poorer areas get nothing? The Secretary of State has managed to add the unfairness of the old rating system to the unfairness of the poll tax. What does he intend to do about it?

§ Mr. Hunt
Not at all. It is easy to calculate, because it is based on the average rates paid in that community. I have more than trebled the amount of relief and whereas in the past just over 300 communities benefited, now well over 600 do. Three times as much relief now goes to twice as many people.

§ Mr. Burns
Does my right hon. Friend agree that the Labour party is extremely long on criticism of the community charge but remarkably reluctant to take part in constructive discussions on how to improve it? Is the reason that the Labour party is unclear about which of its 60 local government policies are actually Labour party policy on financing local government?

§ Mr. Hunt
I have spoken to my right hon. Friend the Secretary of State for the Environment about that matter and understand that the Labour party has introduced a new condition for participating in the review of the community charge in Wales. In England, Labour Members have confined themselves to saying that they will sit down and talk if the purpose of the exercise is the abolition of the "poll tax"; in Wales, the hon. Member for Alyn and Deeside (Mr. Jones) has now introduced a second condition, which is that I must promise to consider the introduction of a property-based tax levied according to an individual's ability to pay. It is about time the Labour party spent more time considering a positive attitude rather than considering what other conditions it will impose.

§ Mr. Murphy
Does the Secretary of State agree that there is universal agreement among all local authorities, 4 most political parties and even most members of the Conservative party that the poll tax is bad and should be abolished? Will not the Ministr admit that, over the years, the poll tax has been seen to be unfair? Does he accept that the most important statement for him to make to the House and to the Welsh people is that, in the first instance, the poll tax should be done away with?

§ Mr. Hunt
If the hon. Gentleman feels so strongly about the matter, why will not he drop the nonsense of preconditions and talk to me about the future of local government taxation? In England the average payment after relief and benefit is £300 whereas in Wales, according to my latest calculations, which are in line with the settlement that I announced, the average payment of community charge after relief and benefit will be £161.