HC Deb 22 January 1992 vol 202 cc304-6
9. Mr. Andrew Welsh

To ask the Secretary of State for the Environment what representations he has received on the planned introduction of the council tax; and if he will make a statement.

The Minister for Local Government and Inner Cities (Mr. Michael Portillo)

There has been widespread support for the introduction of the council tax on 1 April 1993, as we propose.

Mr. Welsh

It is difficult to believe the Minister. Is he aware that the Scots will be paying a surcharge on the council tax over and above their English equivalents and that young, first-time buyers in Edinburgh, Glasgow and Aberdeen will end up paying more council tax than the Secretary of State for the Environment who is one of the wealthiest members of the Cabinet? Why does the Minister ignore the warnings of local council finance departments and professional organisations that the tax is a bureaucratic nightmare riddled with unfairnesses and that, like the poll tax, it is unworkable?

Mr. Portillo

The people of Scotland are paying a surcharge now on the community charge. It was announced today that Strathclyde's community charge is to rise by 35 per cent. because people have not paid. That is because the party that the hon. Gentleman represents urged them not to do so. When the people did not pay and had run up debts that they could ill afford the Scottish National party walked away, leaving them with accumulated debts and the law-abiding citizens to pick up the tab. The Scottish National party was not alone—some Scottish Members of Parliament from the Labour party were also involved, in particular the hon. Members for Glasgow, Provan (Mr. Wray), for Glasgow, Maryhill (Mrs. Fyfe) and for Glasgow, Hillhead (Mr. Galloway), all of whom advocated non-payment. That is now being added to the bills of law-abiding people in Scotland.

Mr. Cran

Will my hon. Friend take the opportunity of the introduction of the council tax to reconsider the proposals of the borough of Beverley, supported by 25 to 30 other districts, concerning the unfair nature of the revenue grants system which will underpin the system of local taxation—indeed, it would underpin any system of local taxation? If he is not prepared to consider those proposals, why not?

Mr. Portillo

My hon. Friend always speaks up well for the interests of his constituents and his local authority. I believe that there was a productive meeting with the Under-Secretary of State, my hon. Friend the Member for Salisbury (Mr. Key). I continue to say to my hon. Friend the Member for Beverley (Mr. Cran) that it is appropriate that the way in which we distribute grants to districts should reflect the social conditions in each place. Certain services provided by districts—for example, those involving environmental health, the administration of housing benefit and the supply of housing to the homeless—are more expensive to provide in areas of social deprivation, so we must measure differences in social deprivation between one place and another.

Mr. Gould

Does the Minister now regret his failure to abolish the 20 per cent. contribution rule, and his rejection of our offer to help get rid of the poll tax this year rather than letting it drag on until next year or the year after? Why has he failed to resolve the legal difficulties now confronting local authorities trying to collect what the Prime Minister described as the virtually uncollectable poll tax? Can it really be true that, on top of the £14 billion already down the drain, he and his right hon. Friend the Secretary of State are thinking of throwing yet more taxpayers' money at the poll tax problem? Does he not recall that the last time that this was tried the consumer faced a 2½p hike in VAT? Is that really what is in store for us again?

Mr. Portillo

The hon. Gentleman's last suggestion is a product of the collective imagination of himself and The Guardian—so far as those two can be dissociated from one another; they seem almost synonymous. The Government have made it clear that if we need to legislate to put right the matter of computer evidence in magistrates courts, we shall do so. My right hon. Friend the Home Secretary is considering that now.

On the question of abolishing the community charge, it is the Labour party which has done what it can to delay the progress of the Bill through the House and the other place. All that it has offered us is a return to the rates, which would be extremely unwelcome in England as well as in Scotland, which is where the question arose. People who have to contribute 20 per cent. of their community charge are given more in their social security benefits than the contribution that they are asked to make. I believe that the time has now come to stand up for the law-abiding citizens—the people who pay their community charge. They have every right to expect that people receiving money in their social security benefits should use that money to pay their community charge, for which it is intended.

Mr. Squire

May I congratulate my hon. Friend on resisting any suggestion of a return to the rating system, which would penalise the one third of households in this country occupied by single adults? Whenever the hon. Member for Dagenham (Mr. Gould) repeats the figure of £14 billion, will my hon. Friend point out to him that a substantial chunk of that money is for rebates, which—unless we are to hear another revelation from the Labour party—a Labour Government—God forbid—would continue?

Mr. Portillo

The figure of £14 billion, as my hon. Friend does well to remind us, is very silly. First, it cannot be computed—one cannot make the figures add up to that sum. Even if one could, the money has been paid to people to help them pay their community charge; it has gone into local services. If the Labour party is saying that it would contribute less than that to local services, it must stand up and tell us so. My hon. Friend is right that to return to a rating system, as the Labour party wishes to do, and to say that large households full of wage earners should pay the same as a single widow is a disgraceful proposition. Only the Labour party—only a party that had learnt nothing in recent years—could possibly advocate it.