Local Government Finance (Wales) (Hansard, 13 January 1992)

§ The Secretary of State for Wales (Mr. David Hunt)
With permission, Mr. Speaker, I should like to make a statement setting out my decisions on local government finance in Wales for 1992–93.
The three reports that set out the final terms of the settlement will be laid before the House on Monday 20 January. I have today placed details of the settlement in the Library and have arranged for essential data to be sent to every local authority in Wales.
When I announced my provisional settlement proposals to the House in July, I referred to the need to adjust the provisional total standard spending figure of £2,639 million to reflect the funding requirements of the Polytechnic of Wales and the five other major higher education colleges in Wales that are to leave the local authority sector on 1 April 1992. In my statement on 23 July, I announced a provisional figure of £34.6 million to meet that need. After further consultation with the Assembly of Welsh Counties, I have decided that that figure represents an appropriate level of funding for the establishments in 1992–93. The settlement has been adjusted accordingly and allows for a level of total standard spending by Welsh authorities of £2,604.4 million. That is an increase of 8.5 per cent. on the comparable figure for last year and an increase of 5.1 per cent. on the level of budgets set by Welsh authorities in 1991–91.
Aggregate external finance in support of that level of spending will be £2,348.4 million—an increase of more than £147 million or 6.7 per cent. on the comparable level of support for 1991–92, taking into account the additional central Government support provided through the £140 general reduction in the community charge for the current financial year and the appropriate adjustment in respect of the higher education establishments. Within the aggregate external finance total, the revenue support grant for 1992–93 is £1,617.1 million, the distributable amount for the non-domestic rating account is £536 million and the total allocated for revenue specific grants is £195.3 million.
The increased support provided to local government in Wales in 1991–92 through the £140 general reduction raised the level of central Government support for local authorities' revenue spending from 79 per cent. to nearly 92 per cent. I will continue this higher level of support in 1992–93 by enhancing the level of aggregate external finance. As a result, the AEF figure for the coming year is £445 million more than the equivalent AEF figure for 1991–92 before implementation of the general reduction—an increase of more than 23 per cent.
The settlement gives local authorities in Wales a realistic framework for developing new services in 1992–93 and maintaining existing ones, particularly in the light of the reduced inflationary pressures that will bear on local authorities in the coming year and the continuing scope for efficiency savings. In that context, I should like to pay special tribute to local government in Wales for the vigorous and collaborative way in which it is pursuing efficiency initiatives. I look forward to meeting both the Assembly of Welsh Counties and the Council of Welsh Districts in the near future to discuss their latest proposals.
If authorities spend in line with these plans, the average community charge in Wales for 1992–93 should not exceed 681 £118—before relief and benefits are taken into account. That is less than half the equivalent figure for English authorities and £3 less than the average charge of £121 actually set by Welsh authorities for 1991–92.
I have already announced my proposals that the non-domestic rate poundage for 1992–93 should be 42.5 p. That represents an increase of just 4.1 per cent. on the rate poundage of 40.8p for the current year. That is a dramatic illustration of the benefit for businesses of our success in bringing down the rate of inflation.
In addition to the financial support through AEF to which I have already referred, I am providing £6 million grant in 1992–93 to Welsh charging authorities to offset the revenue costs of preparing for the new council tax. This represents 75 per cent. of the £8 million revenue cost of implementation estimated in an independent study undertaken by CSL Management Group, which looked at a representative sample of charging authorities in Wales. I recognise that that represents a change of view from my original position that I would expect local authorities to find these costs from within their own resources.
In addition, I have announced that credit approvals will be available to local authorities to cover the full £1.24 million capital cost of preparation estimated by CSL. That is a generous contribution towards overall preparation costs, particularly as the savings to Welsh authorities in administering the council tax when compared with the poll tax—[HON. MEMBERS: "Ah!"]—will outweigh the preparation costs. In due course I shall seek the approval of the House for the council tax preparation grant scheme in Wales.
I should also like to give the House details of my decision on funding the community charge reduction scheme—CCRS—in 1992–93. In my statement on my provisional settlement proposals in July, I confirmed that the scheme would continue in the final year of the poll tax, notwithstanding the considerable increase in central Government support for local authority spending.
Although the overall burden on community charge payers in Wales is very much lower as a result of the increased support that I am providing, I have decided that it would be appropriate to continue to fund a reduction scheme for the final year of the poll tax. I therefore intend to make £40 million available in 1992–93. This will provide substantial assistance to charge payers who most need the relief and is double the amount that was available to charge payers in 1990–91 under the transitional relief scheme when the community charge for standard spending in Wales was £173. The scheme will provide relief direct to specified communities by reference to the actual community charge—or poll tax—set in 1990–91. I expect that more than 50 per cent. of charge payers in over 500 communities in Wales will continue to benefit from the reduction scheme. The average charge in Wales after these reductions should be about £100. Community charge benefit will provide further assistance above that to those charge payers on the lowest incomes.
This is a good settlement for Welsh local government, community charge payers and non-domestic ratepayers alike. The resources that I am providing through AEF and the special grant for council tax preparation, taken together, give local authorities a level of support which is 7 per cent. up on 1991–92. If authorities budget reasonably, 682 charging authorities in Wales should, on average, set community charges that are lower in cash terms than those set in 1991–92. The increase in the non-domestic rate poundage for 1992–93 has been limited to just 4.1 per cent. I expect local government in Wales to rise to the challenge. Charge payers in Wales will expect no less. I have written to every local authority leader in Wales making it clear that, if necessary, I will use my charge-capping powers to curb any authority that I consider sets an unreasonable budget for 1992–93.
I commend the settlement to the House.

§ Mr. Barry Jones (Alyn and Deeside)
I thank the Secretary of State for his statement—"the gospel according to Dai Poll Tax"—which reminds us that the poll tax continues under the Conservatives.
Will the right hon. Gentleman confirm that he faces the prospect of a general election campaign in Wales with the poll tax firmly in place and the poll tax bills hitting the doormats, and is able to offer only a council tax banding alternative that is designed to help the richest, living in the best areas?
Will the right hon. Gentleman, once and for all, recognise that, if the Government had taken up the offer of the Labour party's offer of co-operation on a Bill to abolish the poll tax, we would now be considering the implementation of a fairer, property-based system of local taxation?
Why will not the Secretary of State recognise that his prediction for the average poll tax is way wide of the mark? At best, this settlement is only half of what Welsh districts calculate that they need for next year. Has not the right hon. Gentleman got it wrong? His statement fails to take account of the full effects of inflation, the increased resources needed to fund community care and the new statutory responsibilities introduced by the Children Act 1989. There is also implementation of the national curriculum and of the provisions of the Environmental Protection Act 1990 to be considered.
The Secretary of State's average poll tax prediction is unrealistic. The increase in total spending is nothing like enough. Instead of just over 5 per cent., 10 per cent. is needed for new duties and inflation. The figures that I have given are the key figures, not the inflated figures with which the right hon. Gentleman is playing.
The poll tax nightmare continues. Why did not the right hon. Gentleman admit that the unfair 20 per cent. rule is still in place? Why does it remain, despite the fact that it means that local authorities will have to continue to collect from students and the poor a sum that is often less than the cost of collection itself? Why does the poll tax continue when the Prime Minister has described it as an "uncollectable" tax? Does not the right hon. Gentleman realise that councils in Wales are being asked to engage in the biggest debt collection exercise in the history of Wales? After 400.000 summonses, £17 million in uncollected poll tax and £100 million wasted on implementing the poll tax in Wales alone, why does he not admit that the poll tax was and is a total disaster, under him?
I noticed that the right hon. Gentleman left the prospect of capping wide open. How can he use the rhetoric of partnership on the one hand and threaten local councils with the big stick of capping on the other? How can he justify charge capping, in view of the restrained spending record of Welsh councils? They are loyal, 683 co-operative and helpful. The Secretary of State for the Environment would give his right hand to deal with councillors as good as these.
Does the Secretary of State for Wales accept that this settlement is inadequate against a background of deepening recession, escalating homelessness and growing concern over educational standards? Why does he not immediately begin the phased release of capital receipts—the moneys held by local councils and realised from the sale of council houses? Would not that begin to meet the desperate housing needs of Wales, caused by the cut in the number of affordable homes to rent and the mortgage repossession crisis? Would it not also be a powerful boost to our struggling construction industry and help to kick start the Welsh economy out of its recession?
Thirteen years of Conservative Government are coming to an end. Is it not the case that in those years we have seen £100 billion of oil revenues squandered, standards of local services decline and local democracy undermined and belittled by a centralising, arrogant London-based Conservative Government, who have not listened and who do not care about Wales? I tell the right hon. Gentleman that in Wales his party will be swept into oblivion when the general election takes place.

§ Mr. Hunt
The hon. Gentleman raised eight points. First, he criticised the council tax alternative but failed to mention his solution, which is to return to rates and then to have a revaluation. That revaluation would be based on so many different criteria that even the Labour party cannot begin to work out what it would mean. It does not know whether it would be based on the number of windows in a property, the area of the floor or capital value. Still the Labour party has not worked it out.
I remind the hon. Gentleman again—I shall repeat this again and again because it is exactly what his right hon. Friend the Leader of the Opposition said—that going back to rates would be to return to the most unjust of all taxes.
As for consultations, I remind the hon. Gentleman that there was an empty chair in my office which was never filled by the Labour party. The Liberal Democrats came and made their suggestions in a constructive and sensible atmosphere.

§ Mr. Paul Flynn (Newport, West)
rose——

§ Mr. Hunt
I cannot give way when I am responding to questions.
Members of Plaid Cymru came and put their point of view in a sensible and constructive manner. My right hon. and hon. Friends did likewise. The Labour party never came.
The third point is that the hon. Member for Alyn and Deeside (Mr. Jones) says that there are additional inflationary pressures. I remind him that inflation is now down to 4.3 per cent., and that the settlement that I have announced is considerably in excess of that.
The fourth point is the claim that this is an unrealistic settlement. I merely say to the hon. Gentleman that it allows for local authorities to spend £1,193 for every man, woman and child in Wales, towards which they will be receiving external financing of £1,075. That is a pretty good deal by any stretch of assessment.
The hon. Gentleman says that it is nothing like enough, but what is he really saying? I notice that there are certain key Opposition Front-Bench Members absent—[Laughter.] wait for it. I do not see—[Interruption.] The 684 hon. Gentleman has proved my point. There are certain noticeable absentees—the shadow Treasury Front-Bench team. Where is the right hon. and learned Member for Monklands, East (Mr. Smith)? The hon. Gentleman misses the point.

§ Mr. Ron Davies (Caerphilly)
On a point of order, Mr. Speaker.

§ Mr. Speaker
I have heard nothing out of order. It may be a point of disagreement.

§ Mr. Davies
No, Mr. Speaker.

§ Mr. Speaker
What is the hon. Gentleman's point of order?

§ Mr. Davies
The Secretary of State is supposed to be replying to questions asked by my hon. Friend the Member for Alyn and Deeside (Mr. Jones). Surely it is not fair for him to take this opportunity to criticise Labour Members for their absence.

§ Mr. Speaker
The hon. Member is strictly correct, but I have a suspicion that this frequently happens shortly before a general election.

§ Mr. Hunt
If the hon. Member for Alyn and Deeside will listen to the conclusion of the sentence, he will understand.
I do not criticise the right hon. and learned Member for Monklands, East or the hon. Member for Derby, South (Mrs. Beckett) for being absent. I wonder whether the hon. Gentleman would say what he has just said if the right hon. and learned Gentleman and the hon. Lady were present. He has said that the proposed spending is nothing like enough. I want to know whether he says that with the authority—[Interruption.] Not from the districts. He has said from the Opposition Front bench that this—[Interruption.] Do not point at me with some press release.

§ Mr. Speaker
Order. I do not think that we resort to pointing here.

§ Mr. Hunt
The hon. Gentleman should not point.

§ Mr. Barry Jones
On a point of order, Mr. Speaker.

§ Mr. Hunt
I am answering the hon. Gentleman.

§ Mr. Speaker
Order. Let us hear the point of order.

§ Mr. Barry Jones
I shall be brief, Mr. Speaker. The Secretary of State cannot even read from his prepared notes. He is not even attributing the right figures to the district councils, which sent out a well distributed press release. The right hon. Gentleman can rule in Wales only by press release and hype, and today we are seeing him at his worst.

§ Mr. Speaker
Order. I am not qualified to judge the figures. Let us return to the main subject. We have a heavy day ahead, and a number of hon. Members want to ask questions on this statement.

§ Mr. Hunt
It was the hon. Gentleman who flashed the press release at me. He should not refer to a press release. What he said in this Chamber, to which I am replying——

§ Mr. Barry Jones
Answer the question.

§ Mr. Hunt
I am answering the hon. Gentleman's point. He said that the spending allocation that I announced was 685 nothing like enough. Did he say that with the authority of his shadow Cabinet colleagues? If he believes that that spending allocation is nothing like enough, how much does he think local authorities should spend? From where is the money to come? Will it come from the community charge payers, by increasing poll tax—community charge—demands, or will it come from the taxpayer? He cannot simply say that the spending allocation is nothing like enough; he must spell out what that means.
Fifthly, on debt collection, the hon. Gentleman needs reminding that local authorities in Wales have done extremely well. They have collected 100 per cent. of what they budgeted to collect in the last financial year, and it appears that they are doing just as well in the current financial year.
The hon. Gentleman asked whether I would release capital receipts on a phased basis. I must tell him that the net position is one of substantial local authority debt. The latest figures that I have for all-services local authority debt is £2.917 billion, which is more than £1,000 local authority debt per man, woman and child in Wales.

§ Mr. Barry Jones
So?

§ Mr. Hunt
So there are no net receipts as such to distribute. There is local authority debt of more than £1,000 per man, woman and child in Wales.
Seventhly, on capping, presumably there would be no limits under the Labour party. It would be helpful if the hon. Gentleman could confirm that. Not only is the spending allocation not enough, but the message from the Labour party is, "Spend, spend, spend; tax, tax, tax."
On the hon. Gentleman's final point, I remind him that Wales has been transformed under the Conservatives during the 1980s and has become the land of opportunity for the 1990s. At the next general election, the people of Wales will have to decide whether to return to the bad old days of the Labour and Liberal parties or to move forward under the Conservative party.

§ Sir Anthony Meyer (Clwyd, North-West)
My right hon. Friend may or may not be aware that the hon. Member for Alyn and Deeside (Mr. Jones), in a now justly celebrated sermon from the pulpit of St. Asaph's cathedral, promised unlimited support for the arts under a Labour Administration—and that is in addition to the considerable commitments that evidently he has urged this afternoon.
Is my right hon. Friend aware that local authorities in my area regard him as a Minister who is prepared to listen and to help, and that they deeply appreciate that? Is he further aware that the people of Wales will recognise what an excellent deal his announcement is for them? It is very much better than is available for England. There is also particular gratitude for the trouble that he has taken to ease the transition from the community charge to the new council tax.

§ Mr. Hunt
I am grateful to my hon. Friend for putting the points that he did, which I hope Opposition Members will answer at some stage. It is all well and good to go around Wales promising more spending—spend, spend, spend. However, someone will have to pick up the bill, and undoubtedly that will be the people of Wales. When the people of Wales realise that the settlement allows for 686 spending of £1,193 for every man, woman and child in Wales—towards which there will be external finance of more than 90 per cent. of that figure—they will appreciate that it is a very good settlement.

§ Mr. Alex Carlile (Montgomery)
The Secretary of State is the person who set the poll tax on the track, only to see it later plunge into the political abyss. That cost Welsh taxpayers a great deal of money. Can the right hon. Gentleman explain why he regards it as still right that Welsh poll tax payers should pay any part of the transition to council tax? Surely it is most unfair for them to face that expenditure.
Why has the Secretary of State not given an additional amount toward the peripherality factor, which still disadvantages rural areas in Wales? They find it difficult to meet necessary revenue expenditure, such as the cost of road repairs and the much increased cost of social services in the light of the care in the community policy.

§ Mr. Hunt
On peripherality and the whole standard spending assessment question, I have a distribution sub-group of the Welsh Consultative Council on Local Government Finance, which allows district and county representatives to meet my officials to talk through the factors that should govern the distribution of standard spending assessments. The outcome is heavily dependent on the data that are fed in by local authorities, which change from time to time.
That sub-group seeks to balance the needs of rural and deprived areas and those of more urban areas. On balance, local authorities agree with the way in which standard spending assessments are currently worked out. That matter is obviously one that we consider from time to time, in great detail.

§ Mr. Gwilym Jones (Cardiff, North)
My right hon. Friend's excellent statement will be warmly welcomed in Wales. Is he aware that many people in Wales are concerned about media claims that Welsh local councils are hellbent on setting the community charge at about £300? Is not my right hon. Friend's announcement today a complete rejection of such claims? Thanks to this Government, surely not even the most malicious left-wing council could set a community charge of about £300 and impose it on its local electors. However, does not such a threat emphasise the need for my right hon. Friend to keep his capping powers?

§ Mr. Hunt
I believe that my hon. Friend refers to national press stories that were echoed in the Liverpool Daily Post, which suggested that community charge levels were to reach £300. Those reports, of course, referred to the level in England, of a community charge for standard spending of £257. My hon. Friend is right to say that there were many telephone calls to the Welsh Office from people asking what on earth was happening. In fact, the position remains unchanged. Our community charge for standard spending is £118, as opposed to £257 for England. Today's announcement means—even before community charge benefit is taken into account—that the community charge in Wales next year should be around £100.

§ Mr. Ted Rowlands (Merthyr Tydfil and Rhymney)
Is the Secretary of State aware of the deplorable state of our roads and pavements, and the fact that significant parts of our street lighting system are out of action as a result of disrepair, when all the evidence is that effective street 687 lighting helps to combat crime? Given the huge backlog of disrepair, has the right hon. Gentleman provided any special factor for dealing with such genuine, local, and fundamental problems that all of us face from day to day and from week to week?

§ Mr. Hunt
As the hon. Gentleman knows, we do not deal in Wales through hypothecated or specific grants for the totality of local government expenditure, but reach an overall figure for total standard spending—which is more than £2,600 million. It is for local authorities to set their own priorities within that expenditure. I have no doubt that we could point to certain local authorities that do not exercise their priorities correctly, but it is for local authorities to determine their own priorities within the overall settlement.

§ Mr. Ieuan Wyn Jones (Ynys Môn)
Does the Secretary of State accept, however, that in no year in which he has given the average figure for the poll tax base for Wales has that figure been achieved? When local authorities assess settlements such as the one that he has announced today in relation to what they received in the previous year, they never seem quite so generous.
Will the right hon. Gentleman respond to the genuine concern felt by Welsh local authorities about the additional expenditure imposed on them as a result of Government legislation—especially that caused by the plans for community care and the implementation of the Children Act 1989? Will he assure us that any shortfall in training programmes connected with such changes will be made up this year?

§ Mr. Hunt
The hon. Gentleman is right to stress that it is up to local authorities not only to set their own priorities—I made that point to the hon. Member for Merthyr Tydfil and Rhymney (Mr. Rowlands)—but to work out the level of community charge that should be set locally. I have never suggested that I would do other than emphasise to local authorities that they must budget sensibly. I have also said that I would prefer that to be done by means of self-restraint, but it is important to have that ultimate power to protect charge payers in Wales. I am not sure about the policies of Plaid Cymru; I do not know whether it would provide for such a power to restrain excessive spending. Labour, however, has said that it would introduce no such power.
I have made clear my determination to ensure that local authority expenditure is kept to a reasonable level in the coming year. That is why I shall not hesitate to exercise my charge-capping powers should it become necessary to do so.

§ Mr. Roy Hughes (Newport, East)
Does the Secretary of State appreciate that, despite his palliatives and protestations, he will find it very difficult to live down his close association with the poll tax? May I also draw to his attention the deteriorating housing situation in Wales? It is developing into a scandal, mostly because our local authorities are not allowed to spend the receipts from the sale of council houses.
Why did the right hon. Gentleman dodge the request for him to give a clear and specific reply on that subject to my hon. Friend the Member for Alyn and Deeside (Mr. Jones) this afternoon? Our local authorities Wales are fed up with the repression imposed on them by the present Government.

§ Mr. Hunt
To some extent, Opposition Members give the impression that those capital receipts have vanished, blown away by the winds of faith. That is not so; they have been used, very sensibly, to pay off their debts that were incurred when the houses involved were built. As I have already told the hon. Member for Alyn and Deeside (Mr. Jones), the amount of local authority debt in Wales is more than £1,000 for every man, woman and child.
Government support for local authority capital expenditure next year has increased by 24 per cent. over the current year, rising to £536 million. The lion's share is earmarked for housing—in particular for the home improvements and renovation scheme, which I believe is going extremely well in Wales.

§ Mr. Win Griffiths (Bridgend)
Is the Secretary of State aware, first, of the growing housing problem; secondly, of the increasing difficulties experienced by local authorities in putting central heating systems into houses when requests for them have been made on medical grounds; and, thirdly, of the lengthening waiting lists for adaptations to houses that are needed by, for instance, disabled people?
May I plead with the right hon. Gentleman to think again about a phased release of capital receipts? Much good could be done for people throughout Wales through the expenditure of relatively little money. Will the right hon. Gentleman give a pledge to re-examine the matter, and to do something about it?

§ Mr. Hunt
I am not too sure that the hon. Gentleman listened to the answer that I gave the hon. Member for Newport, East (Mr. Hughes). As I said then, local authority capital has been increased by some 24 per cent., to £536 million. I have also been able to persuade my Government colleagues to increase the provision of mandatory home renovation grant by £80 million, bringing next year's total provision to £143 million. That will greatly assist us in improving existing housing stock. As for the provision of new houses, the hon. Gentleman will know that the Housing for Wales allocation is now at record levels.

§ Mr. Peter Hain (Neath)
The cost of setting up the poll tax, administering it and then bailing it out has amounted to £1 billion in Wales alone, according to the Local Government Information Unit. Is it not time that the Secretary of State apologised to the House for a wanton misuse of £1 billion of other people's money that makes even Robert Maxwell look like a saint?

§ Mr. Hunt
The hon. Gentleman is a master of hyperbole and the single entendre. I do not know where he found that £1 billion figure, but his mathematics presumably included the transitional relief scheme and various other grants.
I make no apology for having abolishing the iniquitous domestic rating scheme. What saddens me is the fact that the hon. Gentleman's party proposes to return to it.

§ Mr. Flynn
Will the Secretary of State list all the recommendations made by the Liberal Democrats that he has incorporated in the council tax proposals?

§ Mr. Hunt
Of course: I shall willingly write to the hon. Gentleman.

§ Mr. Donald Anderson (Swansea, East)
The Secretary of State has always shown great enthusiasm for the poll tax 689 in general, and he now shows great enthusiasm for this settlement. As he is so enthusiastic, may I invite him to make the poll tax a battleground in the approaching general election, and to urge every Welsh local authority to ensure that it issues the demands that the system will involve before the election takes place?

§ Mr. Hunt
Although I do not know when the election will be, I should be delighted if the people of Wales made up their minds about clearly expressed alternatives. Under the present Government's spending plans, which include a special Welsh grant advantage, more than 90 per cent. of local spending will be met by external finance; less than 10 per cent. will be met by the local charge payer.
I should like the people to decide between the present Government, who are abolishing the poll tax or community charge and replacing it with a fairer council tax, and the Labour party, which promises a return to the system of taxation that its own leader has described as the most unjust of all—the iniquitous, hated domestic rating system.

§ Mr. Ron Davies (Caerphilly)
May I point out that the distribution of grant is grossly unfair? Authorities such as Rhymney Valley—which, on every objective index, can be described as socially deprived, receive less than the average increase that is available to Wales as a whole.
Does not the Secretary of State realise that, given the enormous housing and unemployment problems that we have in the valleys, his standard spending assessment model is grossly unfair and needs re-examination? If local authorities in the position that I have described find that they are forced to raise poll tax levels by more than the right hon. Gentleman recommends, and if he is minded to use his reserve capping powers, will he now undertake to consult those authorities before taking such draconian action?

§ Mr. Hunt
No. The local authorities know my position, which I have made absolutely clear. In regard to spending generally, I have been asked various questions by hon. Members on both sides of the House about whether certain kinds of spending have been taken into account—for instance, spending on community care. I have considered the entire range of local authority services, and I believe that, against that background, the settlement is fair and just.
As for standard spending assessments, as I told the hon. and learned Member for Montgomery (Mr. Carlile), we examine them constantly. If the hon. Member for Caerphilly (Mr. Davies) has any specific proposals, I shall be pleased to hear from him; but we consider SSAs carefully, within the overall total of standard spending, and our proposals struck me as a reasonable compromise between the various interests involved.
As the hon. Gentleman knows, we recognise the importance and significance of the valleys. That is demonstrated by the valleys programme, which was launched by the present Government.

§ Dr. John Marek (Wrexham)
The leader of my council tells me that its capital receipts from the sale of council houses is about £12 million. He tells me also that the council is not allowed to spend that money. If it were able to do so, more houses could be built, with no additional 690 burden on taxpayers or poll tax payers. Why is the Secretary of State so pathologically blind—because of his Tory dogma—to the real needs of the helpless and the homeless who desperately need homes but are denied them by his policy?

§ Mr. Hunt
May I explain again that we are dealing with a very substantial local authority debt burden—the figure approaching £3 billion, which represents more than £1,000 for every man, woman and child in Wales. I have already decided—I hope that the hon. Gentleman welcomes my decision—to increase local authority capital provision next year by 24 per cent. Most of that will go into the provision of housing. In addition, of course, the resources earmarked for the provision of housing in Wales is at a record level. My hon. Friend the Under-Secretary has published an extremely good agenda for action on housing. I therefore hope that the hon. Gentleman accepts that we take very seriously indeed our responsibilities for housing in Wales.

§ Mr. Rhodri Morgan (Cardiff, West)
About six times this afternoon, Opposition Members have asked the Secretary of State about the impact of his settlement on the ability of local authorities to implement the Government's proposal to transfer to the local authorities responsibilities in respect of care in the community and the Children Act 1989. Each time that the Secretary of State has had an opportunity to comment on that matter, he has refused to do so. What does he expect will be the impact on the ability of local authorities progressively to take on the burden, from 1 April, of looking after the services currently provided by the health authorities with direct Government finance?

§ Mr. Hunt
I thought that I had just said in reply to the hon. Member for Caerphilly (Mr. Davies), but I say again, that I have looked at the whole range of services. In respect of community care, we in Wales are extremely well on course towards implementing the new system on 1 April 1993. Included in this settlement are specific grants for training, and various other spending responsibilities have been taken into account.

§ Mr. Paul Murphy (Torfaen)
Is not the Secretary of State's great problem the fact that he simply does not listen to people in Wales? If he had listened to the people of Wales, he would not have been burdened by the tragedy of the poll tax. If he had listened to local government leaders in Wales, we should not have a system of poll tax relief that is so inane that it goes not to individuals but to communities. If he had listened to my hon. Friends about the question of housing, and had released the capital receipts that are locked away in the coffers of local authorities, tens of thousands of people in Wales would have houses. Cannot he see that, for these and other reasons, the next time a Secretary of State for Wales comes to the Dispatch Box to announce a rate support grant settlement, it will be a Labour Secretary of State?

§ Mr. Hunt
I would listen more willingly to the hon. Gentleman if he were to get his facts right. He says that, if I had listened to local authorities in Wales, I would not have produced this transitional relief scheme. [Interruption.] He says that they have changed their view. In fact, he has changed his position. A few moments ago, 691 he said that, if local authorities had been listened to, we would not have introduced the scheme. But we introduced the scheme in response to a request from local authorities.
It is a very simple and effective scheme. We are now in the final year of the poll tax or community charge system, and I do not think that the hon. Gentleman would have expected us to produce an alternative system based on individual need and requiring everybody to apply. Does he really think we ought to have done that?
I believe that this is a very fair settlement. The average community charge in Wales, even before taking community charge benefit into account, will be about £100. The only people in this House that I fear are my English colleagues—they having heard that the community charge in Wales will be about £100. The key question—to which we have never had a response—is whether the shadow Secretary of State will continue the special Welsh revenue support grant advantage that has been secured under the present Government. From the Labour party there is a deafening silence as to whether it would continue to fund local government services to the extent of more than 90 per cent. from aggregate external finance.
The fact is that, under a Labour Government—for the sake of the people of Wales, I very much hope that that will never come about—the policy on local authorities would be "spend, spend, spend", and the bills would have to be met by the people of Wales.