§ The Minister for local Government and Planning (Mr. David Curry)
I do not blame you, Madam Speaker, for being slightly confused; I am fairly confused about this myself. [Interruption.]I have never been modest when starting something: give me six months and we shall see.
I beg to move,
That the draft Council Tax limitation (England) (Maximum Amounts) Order 1993, which was laid before this House on 7th June, be approved.
This debate is the last piece of local government finance business for the first year of the council tax. That tax is now fully in place and has widespread support. It avoids the unlimited bills of the old rating system and the problems of the community charge. It is fair to local taxpayers without being administratively burdensome for authorities.
The successful introduction of the tax would not have happened without the help and close co-operation that we have received from local government. The council tax is a success story for which local authorities up and down the country can take much of the credit. The experience that we have all gained in working on it with local authorities has been fruitful, and we have built up trust and lines of communication between local and central government at all levels. My right hon. Friend the Secretary of State and I are determined to continue to build upon that approach.
With regard to council tax capping, local government cannot—and, I believe, now does not—expect to be exempt from the need for the restraint of overall expenditure. last year local authority expenditure in England was £60 billion—that is £1,000 per head. Taking the United Kingdom as a whole, local authority expenditure accounts for a quarter of total public expenditure, and more than 9 per cent. of our domestic expenditure.
However, it is not our aim that authorities should be capped. As in previous years, we announced provisional capping criteria in the autumn preceding budget setting. Our aim was to achieve as much as possible by setting out clear and fair guidelines in advance, so that the maximum was done by voluntary restraint, leaving as little as possible to be done by capping. But we made it clear that, should any authority budget too high, we would cap it, and hence safeguard council tax payers against excessive bills, and also safeguard the public expenditure position.
In the event, 416 of the 419 English authorities have set their budgets within the cap. That is by far the highest number since capping began. The fact that 416 authorities have set affordable budgets and council taxes is further evidence of the sense and responsibility of local government.
Of course, Government have had their part to play. This year, standard spending assessments increased on average by 3.1 per cent. at a time when inflation reached its lowest level for decades. We are satisfied that each authority's SSA this year is a fair measure for its spending on the basis of the most up-to-date information that we have. But we are already seeking improvements in SSAs, 383 and, as is well known, in the coming year we are undertaking a thorough review of the SSA and the area cost adjustment that is a component of it.
We especially wish to be able to have regard to the new information available to us from the 1991 census, and to take advantage of the need to incorporate that more up-to-date information to consider how we can improve the SSA system as a whole. I have to be careful when I say SSA, because I am more used to talking about SSSIs, and I appreciate that SSAs are not the same thing.
We have invited every local authority to submit any comments that it wishes to make on SSAs, or to put forward any evidence that it may have that would support changes in the method. Throughout the review my officials have had, and will continue to have, frequent discussions with the associations that represent local authorities. Our object is, with the help of local government, to obtain SSAs that we judge are the best and fairest measures for local authority spending given the information and data available to us.
§ Mr. Jeff Rooker (Birmingham, Perry Barr)
When he conducts the review, will the Minister think it worth while to ask local authorities, especially education authorities, about discretionary funding to students in further or higher education? More than half the authorities in England have cut that funding, and that has had an especially bad effect on mature students with household responsibilities, who may he unemployed at the time. The fact that more than half the authorities have had to cut that discretionary funding in order to remain within the capping limits is of concern to Members on both sides of the House, but because the funding is discretionary, the information is not usually collected. The Government should take a hard look at the effect of the new council tax on discretionary funding.
§ Mr. Curry
As I said, we are examining the whole methodology of the SSAs. I have encountered in my constituency in North Yorkshire the problem that the hon. Member for Birmingham, Perry Barr (Mr. Rooker) mentioned, so I recognise that it is a subject for concern. But I must make one cautionary statement. It would be wishful thinking to believe that one can carry out a review from which everybody will gain.
If some authorities believe that they are being underpaid in the present system, there must, by definition, be others that are doing relatively well out of it. Therefore, when we correct the balance, we are likely to find a number of complainants and a number of beneficiaries. They may be different people, but I have no doubt that those who complain will wish to line up as vigorously as they do at present.
I understand the point that the hon. Member for Perry Barr made. Nothing is excluded from the review, but, at the same time, we must make sure that it is practicable, that there is a time scale in which to do it, that local authorities are consulted and that the details with which they have to work are available to them as soon as that is possible within the constraints of the new budgetary timetable. The hon. Gentleman will understand that.
What of this year's capping round? On 1 April my right hon. and learned Friend the then Secretary of State took his capping decisions. He had regard to all relevant considerations, including the budgets that authorities had set and the provisional criteria that he had announced to 384 the House on 26 November. He decided to adopt criteria for identifying the authorities in respect of which capping was necessary which broadly gave effect to those provisional criteria. Authorities were, therefore, selected for capping which had budgeted excessively or whose budget represented an excessive increase over the previous year.
On the basis of the criteria, my right hon. and learned Friend identified three authorities—Castle Point, Gloucestershire, and Harlow—for capping. At the same time, my right hon. and learned Friend proposed for each of these authorities a cap, or maximum, for its budget.
The toughest cap that we could propose would require a designated authority to reduce its budget so that it was no longer excessive or represented an excessive increase. But we could do that only where, having regard to the authority's individual circumstances, we believed such a reduction would be achievable—that is, that it could be made in such a way as to avoid significant disruption to essential services.
In other cases, we would require only smaller reductions which we judged it would be right to demand of the authority, given its particular circumstances, in the financial year.
In the circumstances of Harlow and Castle Point, we judged that it would not be right to demand the full reductions in a year for those authorities. For Gloucestershire, however, we proposed a cap which would require the full reduction. In terms of the council tax for a band D dwelling with two adults, our proposals meant for Harlow a tax reduction of £288; for Gloucestershire and Castle Point reductions of £55 and £18 respectively.
Authorities were notified on 1 April of their designation, the general principles on the basis of which they were designated, and the amount of the proposed cap. They then had 28 days to tell us whether they accepted the proposed caps. If they did not accept, they could suggest an alternative cap and put forward a case in support of it.
All three authorities suggested alternative caps. Castle Point and Gloucestershire wished to retain their original budgets. Harlow proposed a cap of around £2.1 million less than its original budget, but still £4.6 million in excess of the proposed cap.
My predecessor met representatives of each of the three authorities to hear their oral representations in support of their cases. Before taking his decision, my right hon. Friend the Secretary of State considered all the points very carefully, including those made at the meetings.
For Castle Point, whose difficulties arise solely from the need to meet in 1993–94 a £2.2 million deficit which was due to incorrect budgeting in previous years—
§ Mr. Curry
By the treasurer. For Castle Point, it was clear that the cap at the level proposed would be very tight. However, the authority told us that it was planning to generate substantial capital receipts during 1993–94 from asset sales. If we issued a statutory direction, Castle Point could use some of these receipts to pay for about £0.5 million redundancy costs that would otherwise be charged against their 1993–94 budget. We decided that it would be right to issue such a direction, and on this basis we concluded that a cap at the level originally proposed would be right for that authority.
385 For Harlow, all parties on the council agreed that a cap of more than £11.2 million was required. We considered Harlow's case and considered that, given the magnitude of the budget reductions—about 30 per cent.—and the relatively short time in which they must be made, the original proposed cap was too tight. We judged that a relaxation of £600,000 to a cap at £11.8 million would be appropriate given Harlow's circumstances.
For Gloucestershire, we decided after very careful consideration of all available relevant information that the cap should be set at the level originally proposed.
In all cases, we have undertaken an extremely searching analysis of the authorities' individual circumstances. We are satisfied that the caps that we have now decided are reasonable, achievable and appropriate in all the circumstances of the authorities concerned. In the one case in which we have relaxed the proposed cap—Harlow—the tax reduction for a band D dwelling with two adults is now £263 and for a band G dwelling, £438.
If the order is approved by the House, we shall then serve the statutory notices on the three authorities formally setting their caps. Within 21 days thereafter they must reduce their budgets in line with the caps; new lower council taxes must be set as soon as practicable afterwards. Each of the capped authorities must meet from within its budget the costs of issuing the new council tax bills. It will be for each authority to decide how to live within its budget, but we are satisfied that they will be able to provide an appropriate level of service if they choose to do so.
Ideally, of course, no authority would be capped. But we should not let the fact that we have needed to cap three authorities detract from the fact that it is a considerable achievement for local government to bring in the council tax at an affordable level throughout the country. For the council taxpayers of Castle Point, Gloucestershire and Harlow, the order will mean reductions in their bills and it will require those authorities to curb their excessive budgeting, and I commend it to the House.
§ Mr. Jack Straw (Blackburn)
The Labour party is wholly and unequivocally opposed to the capping of a council's budget. It is an abuse of central power, it demeans democracy, it undermines the right of local people to decide what services they are ready and willing to pay for, it is in breach of one promise after another from the Conservative party, it serves no economic purpose, and it has not worked in its own terms.
The Conservative party was elected 14 years ago on pledges to give back power to local people. Those pledges have been broken. Also, 144 separate Acts of Parliament have been forced through in those 14 years, each cutting councils' power a little more, each transferring more power to Whitehall or to the unelected quango state. Although only three authorities are specifically named in the order, all councils—all 419 of them—have been capped this year. That is what every council understands.
Former Councillor Bill Dixon-Smith, the former leader of the Association of County Councils, who lost his seat in Braintree when the Conservatives were swept from power in Essex, not least in revulsion against the capping of two authorities in that county, pointed out that the capping 386 powers given to the Government and their use of them has meant that in every case the council tax has been set not by local authorities but by central Government.
Capping orders are but the culmination of the transfer of power from local taxpayers to the central state. Such orders give greater power to the Secretary of State over democratically elected local councils than any powers otherwise exercised outside wartime. Given the seriousness, given the fact that hundreds of people will lose their jobs as a direct result of the order, given that thousands will suffer through reductions in services and given, too, that the Secretary of State actually signed the order and is present, I must say to the Secretary of State that it is outrageous that he has left it to his Minister to speak to the order rather than doing so himself.
I welcome the new Minister to his job and I wish him well. Had the Secretary of State spoken, I would have welcomed him to his new job, but I can understand his reticence, for this Secretary of State was once the Minister for the community charge—the apostle for the poll tax, who evangelised the new system in even less guarded terms than his predecessor in both jobs, the right hon. and learned Member for Folkestone and Hythe (Mr. Howard).
§ Mr. Straw
He would not have been elected as a councillor.
The Secretary of State said that the poll tax wasby far and away the best alternative to domestic rates.He made a speech of 27 pages—I have every page of it with me, in case anybody doubts it—which began with the wordsThe morality of the community charge".He claimed in those 27 pages that the poll tax was "morally superior" to the domestic rates. [Interruption.] He obviously believes it. He said:The community charge really will put the community in charge.He went on to tell the Conservative party conference on 13 October 1988 [Conservative Members were cheering in the aisles at it [that the poll tax wasthe clearest, simplest and fairest local tax ever. We can go out and win with it.Wiser counsels in the Conservative party knew him to be wrong.
The Secretary of State did not devote his florid rhetoric only to the poll tax. He devoted it to any tax based on capital values. In case the Secretary of State has not spotted this, I point out that the new council tax is based solidly on capital values. In his speech to the Conservative Greater london local government conference—that may be an oxymoron these days—on 22 November 1988, the Secretary of State said:Rate bills based on the value of a home would be a disaster for London. Capital value rates would be a swingeing tax on home ownership.What does he say about that now?
The Secretary of State—this comes directly to the point —said in an interview in the Municipal Journal in August 1988 that the new financial arrangements that he was piloting would lead to very much more independence. He then talked about his belief in the Tory view of local control and local power. In case my hon. Friends have missed that, I shall repeat those words.
I sense that the Secretary of State claims not to have changed his mind; perhaps he still takes that Tory view of 387 local control and local power. The Secretary of State has an extraordinary set of views. He is in favour of the poll tax as the fairest tax of them all and he is against any idea of a council tax or a capital tax, yet he proclaims the importance of independence, local power and local control.
The reality when the Secretary of State made those speeches and the reality even more today is that the Government have removed local control and local power to a point where the major decisions are made not by local councillors but by the central state. As Conservative Woking said in The Independent in January:capping has removed the ability of elected councillors to pay for services that local residents want and have voted for.The capping system is patently undemocratic. It serves no wider economic purpose in the control of public expenditure. If the Minister, who confessed to being confused when he opened the debate, wants to spend his next six months learning the job, I modestly advise him to read the Treasury's White Paper issued in 1988 called, quaintly, "A New Public Expenditure Planning Total". In that White Paper, the case not just against capping but against central Government even collecting the figures for what local authorities spend out of their own resources is set out, page after page.
The Prime Minister, when Chief Secretary to the Treasury, was the author of that White Paper. He pointed out that other countries that have more successful economic policies than we have do not have capping. In some federal countries, such as Germany and the United States which are both unquestionably more successful than us, the federal constitutions do not allow central Government to think about the powers that have been taken here.
The Minister might also look at the answer that the Chief Secretary gave me on 11 January 1993. I asked him to assess the effect on jobs and services, on interest rates and on other major macro-economic indicators of various changes in local authority spending. I assumed that that had been done before the Government decided to go down the road to central control. The answer was that the Treasury had not done the work and that it could not give an answer.
The Minister could also look at the results of the report that the london School of Economics local government unit published in the local Government Chronicle last July. It pointed out that, while capping led to enormous disruption to councils and to local democracy in any one year, over time it had not affected the trend in local government spending because all authorities were forced either by direct Government control or through political pressure to spend at the level of the standard spending assessment.
This year, capping has already led to the cutting of thousands of jobs in local authorities. I remember the then Secretary of State in December claiming that no jobs would be lost as a result of his settlement. It is interesting to note the Minister's silence tonight in the light of the evidence from across the country that thousands of jobs have indeed been lost.
In the three authorities named in the order, there is a very serious situation. Gloucestershire is a relatively low-spending authority. When it was Conservative-controlled, it was a byword for parsimony and it had the worst record of any authority in the country for the provision of nursery schools and classes.
§ Ms Jean Corston (Bristol, East)
Does my hon. Friend agree that it is outrageous that Gloucestershire should be on the list, particularly as the Minister has just told us that the Secretary of State's criterion for deciding whether a county should be on the capping list was that a significant reduction in essential services should be avoided? Gloucestershire has not even got nursery education which we in the adjoining county of Avon have. Which essential services is it being suggested that the people of Gloucestershire should do without? Does my hon. Friend agree that those are the sorts of question that the Minister should be asking?
§ Mr. Straw
My hon. Friend has far more knowledge of Gloucestershire than I have, and of the comparison between Avon, which has been an excellent Labour authority—incidentally, it has not been capped—and Gloucestershire, which has spent the last few years away from Conservative control attempting to deal with the legacy of appallingly low services that it faces, with no nursery education at all.
The chief executive has written to the Department of the Environment to say that 250 jobs will be lost as a direct result of the proposals, in addition to the 800 jobs which were lost in previous years as a result of capping. Of those 250 jobs, 150 were among teachers—teachers and essential support workers. How will the loss of 150 jobs in Gloucestershire, which the Government are forcing on that county, lead to an increase in educational standards about which we hear the Conservative party parroting day by day?
§ Mr. Roger Knapman (Stroud)
Is the hon. Gentleman aware that Avon council is so marvellous that every inhabitant is voting to do away with it and to revert partly to Somerset and partly to Gloucestershire?
§ Mr. Straw
My hon. Friend speaks for the south-east as well. He speaks for my home county, Essex, and will deal in more detail with the position in Harlow and Castle Point.
Like many other local authorities on a low budget, Harlow was not subject to any capping until changes in the legislation in 1990–91. It has provided excellent services. As the hon. Member for Harlow (Mr. Hayes) should be aware, Harlow is a new town with significant social problems. It has the highest level of unemployment in the county, and its manufacturing base has been seriously undermined in the past 14 years. Its council has sought to make a reality out of the new town and to build community services.
The capping order will lead to a reduction in Harlow's budget, even after the adjustment, of about 47 per cent. It is expected to be able to halve its budget in one year. Already, there have been 200 redundancies. As a consequence of the cuts, there will not be an overall cut in public spending of the sort the Minister is seeking. It is likely that £2 million of expenditure that Harlow was
389 previously bearing because of the parsimony of Conservative-controlled Essex county council will be borne by Essex county council, which, happily, is no longer in the Conservatives' control.
There will be big increases in charges for elderly people's bus passes and sheltered accommodation. As a gentleman from Harlow said to me today, whatever he gains on the swings by way of a cut in his council tax bill, he will lose on the roundabouts because he will pay out of his pocket through direct charges for services that he previously received for nothing. Various leisure and support services are to be cut.
§ Mr. Jerry Hayes (Harlow)
I am delighted that the hon. Gentleman mentioned roundabouts. It is almost legendary in Harlow that a couple of years ago the Labour-controlled council—which has clear priorities in such matters—spent £28,000 on planting flowers on the roundabout in Harlow. The hon. Gentleman committed a sort of Freudian slip. The council has taken away its grant to the citizens advice bureau, while spending £130,000 on a photocopier. Is that the sort of council and the sort of policies that—[Interruption.]It is all very well the hon. Member for Blackburn (Mr. Straw) waving me away, but those are the sorts of question to which the people of Harlow need answers.
§ Mr. Deputy Speaker (Mr. Geoffrey lofthouse)
Order. The hon. Gentleman is expecting to catch my eye later in the debate. If interventions are of that length, he will probably not be successful.
§ Mr. Straw
If that is the best the hon. Gentleman can do, I look forward with great interest to his speech. What is wrong with spending money on flowers—on roundabouts or anywhere else? Why do we need the full panoply of the central state to determine whether local electors should be allowed, out of their own pockets, to spend a few thousand pounds of flowers? I am delighted when Blackburn borough council spends money on flowers. When lambeth council recently had to cut the money it was spending on flowers, local Conservatives were the first to complain.
The situation in Castle Point was glossed over. It is the only Conservative-controlled authority among the authorities that we are discussing. It has the smallest overall budget—£500,000 means far more to Castle Point than it does to Harlow or Gloucestershire. The cap is to be kept on, but—hey presto!—Castle Point is being allowed to spend £500,000 of capital receipts not for the purposes that the Chancellor proclaimed in his autumn statement —creating jobs and building houses—but on redundancies. That is the ultimate perversion of economic policy: capital being spent, not to create jobs, but to destroy them.
No system of central Government control over local spending is acceptable in a democracy, but what makes this control all the more outrageous is the fact that it is based on the so-called system of standing spending assessments, which are capricious, incomprehensible, unfair and politically biased. The system makes Westminster, Kensington, Chelsea and Cheltenham more deprived than Hartlepool, Barking, Walsall and Stoke. It makes no allowance for long-term unemployment or for the incidence of ill health.
390 The system has preposterous consequences. It has been damned by the Audit Commission, especially for the way in which the SSAs are now used for purposes for which they were never intended. Today they are used, as the Audit Commission report "Passing the Buck" pointed out, to distribute 80 per cent. of total local authority spending. The system was designed at a time when less than 50 per cent. was distributed in this way. Today, the system is used to exert central control over total local government expenditure, but it was never designed for that purpose.
Ministers admit that the system is flawed. That is why the Minister said that the Government are setting up a review, but the last thing he will do is make it independent. The Government know that if a fair system of SSAs were established, we would end the jobbery inherent in the system which results in local authorities such as Westminster and Wandsworth benefiting unreasonably at the expense of other authorities that need the money.
§ Mr. David Clelland (Tyne Bridge)
Is my hon. Friend aware that if Labour-controlled Gateshead council had been given the same SSA as Westminster was this year it would have been able to set a zero council tax for the next two years; or that if Labour-controlled Newcastle city council had been given the same SSA as Wandsworth, far from setting a zero rate, it would have been able to give council tax payers money? Is he confident that the system will be corrected under the so-called review?
§ Mr. Straw
I am sorry to tell my hon. Friend that I have no such confidence. Wandsworth received, in addition to the usual largesse, £30 million of transitional relief. That amounted to one tenth of the relief for the entire country —enough to plant flowers, not just on every roundabout in Gateshead, but beside every road in the country. The hon. Member for Harlow has not complained about that.
Shorn of all its economic mumbo-jumbo, the Conservative case for capping comes down to claims that central Government have—I quote from their consultative document—the duty to protect local taxpayers from unacceptably high bills.In February, the former Secretary of State said:we must … hold faith with the local taxpayers, for whom capping is an important protection."—[Official Report. 3 February 1993; Vol. 218, c. 342.]In the debate on 3 February, the hon. Member for Harlow said:The whole point of the cap is to protect the people in Harlow."—[Official Report, 3 February 1993; Vol. 218, c. 356.]There is some profound arrogance for the House to digest. What happens if people in Harlow, Gloucestershire or even Castle Point take a different view from the self-appointed guardians of their purses in Whitehall and Westminster? Are people to be allowed a say about whether they want protection, or will they get it whether or not they ask for it?
§ Mr. Straw
The hon. Member for Lloyd's says that they do want it. The local elections last month were fought on the issue of which party gave value for money and decent services. There is no better witness to that than the press notice from the right hon. Member for Sutton Coldfield (Sir N. Fowler), who is the chairman of the Conservative party when he is not directing Group 4. He said: 391For once, I am happy to agree with Labour. The decisive factor in this campaign should be which party will provide local services at the lowest cost to local people.We fought the campaign on that issue, and the Conservative party got its answer on 7 May. Across the country Conservative policies and Conservative capping were decisively rejected by voters. In Gloucestershire the Conservative party lost 13 seats. In one night, it went from being the largest party to being the smallest. In Essex, the Conservatives lost 25 seats.
§ Mr. Straw
That is right. We understand the hon. Gentleman's problems and do not want to intrude on his private grief. Obviously, he has so many problems on his mind that he has not bothered to look at the library brief or read the local paper.
The rout was even more dramatic in Essex where, as I have said, the Conservatives lost 25 seats. Labour went 392 from being the smallest party to becoming the largest. Nowhere was the election more closely fought than in Harlow, thanks to the forensic skills of the hon. Member for Harlow. He fought against the district council's record and in favour of capping. As a result, the Conservatives in Harlow were wiped out. They lost their one remaining seat.
The people in Gloucestershire and Essex have spoken. They do not want the protection of this incompetent and politically corrupt Government. They do not want capping. They want decent services, and they are ready to pay for them. The new Secretary of State is keen on morality in taxation. Perhaps he will remember that the legitimate case for capping was crushed on 7 May. Capping is undemocratic and will lead, as it has already led, to the loss of thousands of jobs. It will harm many innocent people. It is an abuse of power by a contemptible Government, and it must and will be opposed. We shall vote against it.
§ Mr. Deputy Speaker
There are 56 minutes remaining for this debate and no fewer than eight hon. Members, including Front-Bench spokesmen, hope to catch my eye. With co-operation on the length of speeches, all hon. Members who wish to speak may be successful. It is up to hon. Members themselves.
§ 11.3 pm
§ Mr. Jerry Hayes (Harlow)
It is wondrous to follow the hon. Member for Blackburn (Mr. Straw) who is the magician of the Opposition because he never fails when he appears with his top hat to bring out a dead rabbit. What he said sums up very well the position in Harlow. The hon. Gentleman said that at the local elections the people of Harlow were talking about this wicked Government and their capping. He was probably worried about more important matters—such as the crisis over the leadership of his party, the unions and perhaps his re-election to the shadow Cabinet—and overlooked one or two basic issues.
Here are the facts. There was a swing to the Conservatives in Harlow of 2.1 per cent.—probably the only place in the whole country, apart from Buckinghamshire. [Interruption.] We are talking about democracy, but the Opposition do not want to listen to the facts. There was a swing against Labour of 4.3 per cent., which says it all. The people of Harlow will be very grateful—[Interruption.] Opposition Members are not prepared to listen. What a great shame, especially considering that the hon. Member for leeds, West (Mr. Battle) trained for the priesthood.
The overwhelming majority of people in Harlow will be delighted if we have capping, given that the Labour-controlled council spent £24 million last year. The council blew its reserves because it thought, whimsically, that Labour would win the general election and bail it out. Nothing was left. From where was it all going to come? The people of Harlow. People in band C would have to pay more than £800 and people in band D more than £1,000. I have received hundreds of letters from pensioners on very low incomes just above income support who would have to pay £1,400 a year, and for what? That is what depresses me most of all.
The hon. Member for Blackburn is an Essex man; he lives just down the road from where I used to live. He knows Essex and the people of Harlow—[Interruption.] I still live in Essex, 20 minutes up the road from him. If the hon. Member for leeds, West would pay attention and listen, he might learn something.
The Opposition support what the council did in Harlow. Four years ago, it spent £28,000 on flowers for one roundabout. It was not for the whole of Harlow, but for one roundabout. At the time, the council was saying that it had to close old people's homes and reduce provision for old people. The hon. Member for Blackburn would not answer questions about that, because he was too ashamed. The council closed down the citizens advice bureau, yet it spent £130,000 on a photocopier. [Interruption.]
I am sorry that Opposition Front-Bench Members find it funny. I find it sad, because jobs are going to be lost because of the incompetence of Harlow council. The Labour-controlled council was warned 10 years ago by me and by Tory councillors that it should bring in advisers to 394 see where expenditure could be gradually brought down. The council ignored that advice, not at its peril but at the peril of hundreds of workers in Harlow. I regard that as an utter disgrace.
I have spoken on many occasions in the House about the legendary incompetence of Harlow council and I will not go back to that now. We are debating the spending cap, but the crisis in Harlow is due to the incompetence of the ruling Labour group, whose idea of prudent financial policy was to meet more than half its revenue spending during the past three years from reserves and interest and to carry on spending at four times its standard spending assessment until the money ran out.
The ruling Labour group had no strategy for meeting a 55 per cent. hole in its income this year. It deliberately created the crisis by totally exhausting its reserves last year; it is now trying to blackmail the Government and national and local taxpayers into picking up the tab for its mistakes. Even if there were no cap for small councils this year, Harlow would be facing the same crisis—a massive 55 per cent. reduction in its income to meet revenue spending and no means of filling it, except by robbing its own citizens, particularly pensioners.
What is the ruling group's attitude to collecting local tax? A recent survey showed that Harlow was the ninth worst council for collecting the community charge and that it has the 352nd worst performance in providing information about the council tax. The council's excuse was, "Perhaps we weren't ready." All credit to Harlow council for considering ways of improving the collection of the poll tax—but it did that on the very day that the last instalment was due, so it was a worthless exercise.
The first person in Harlow to be prosecuted for non-payment of the poll tax was the council's leader, Mr. Richard Howitt, who might be listening to this speech or might read it. I suppose that he has done the most sensible thing—
§ Mr. Hayes
No, but he wants to move to Europe. He has put forward his name as a European Parliament candidate; he is the original Euro-evacuee—not that he will be elected, of course.
Labour-controlled Harlow council did not send out its council tax bills until after the local elections. In view of the figures that I gave the House, I wonder why. Its bills were the highest in the country and were sent out two months after those of everyone else.
Harlow's bills were two and a half times higher than the next highest, five times higher than the average for Labour-controlled district councils, six times higher than the average for all district councils and seven times higher than the average for Conservative-controlled councils. Harlow had to inflate its bills by nearly 60 per cent. to cover uncollected community charges. Caring, Labour-controlled Harlow council responded to that crisis of its own making —I hope that Labour Members do not laugh at this—by increasing its income by introducing an extra charge of £5 per week on the frail and elderly who live in warden-assisted, sheltered accommodation.
Harlow argues that it must maintain spending at four times its standard spending assessment because of the recession, and then expects those paying council tax to be immune from the same recession to meet band C bills nearly 50 per cent. higher than last year, when inflation is 395 running at 1.3 per cent. The council has the audacity to include in its special pleading the statement that the business rate on its own properties increased this year, yet in all its propaganda and meetings with Ministers, there was not one word of consideration about the impact of a 50 per cent. increase in local taxation on local people.
The council persuaded one of its pet trade unions, the National Association of local Government Officers, to stump up £2,000 for a totally bogus report. It employs a policy unit at a cost of £1 million a year but ignores its special advisers. I refer in particular to the council's treasurer, who warned that the use of reserves at the current rate would exhaust the general reserve by 31 March 1993. The council did a courageous thing—it sacked him. He is gone.
We hear a great deal from Labour about democracy, and from the shadow Secretary of State about letting the people have their say. Recently, Harlow's controlling Labour group tried to gag Conservative and liberal Democratic councillors by unilaterally removing their voting rights on committees.
§ Mr. Hayes
The hon. Gentleman has said something sensible, and I hope that it will be recorded in Harlow. For the sake of Hansard, the hon. Gentleman said that they are not allowed. Of course not, but that is the sort of arrogance we have come to expect. That is precisely what was done—I have the letters to prove the truth of that, if the hon. Gentleman wants to dispute it. I am delighted that, in a few moments, we shall have the great joy of hearing from the hon. Member for Thurrock (Mr. Mackinlay). Essex holds its breath.
§ Dame Elaine Kellett-Bowman (Lancaster)
Has my hon. Friend noticed the phenomenon that Labour councillors in opposition always believe in open government, whereas Labour councillors in power believe in secrecy?
§ Mr. Hayes
My hon. Friend is entirely right about the arrogance and corruption of power. There is no excuse for telling councillors in opposition that they do not have the right to vote, but that is precisely what Harlow council has done.
Thurrock has a standard spending assessment of £87.27 per head, while poor old Harlow has a miserly and unfair £103.37 per head. As for revenue support grant, Thurrock receives £28.74 in tax, while hard-done-by Harlow must scrape by with only £45 per head. Perhaps, when he is given his turn, the hon. Member for Thurrock will tell us how on earth his local authority manages to provide services with such amazingly low levels of support, and why Harlow cannot.
Harlow council spends £19,000 every year examining its daft proposal for eight mini-town halls. It is called democracy in decentralisation. The council obtains its advice from Dr. Derek Hawes, of the school for advanced urban studies at Bristol university. I have known Dr. Hawes for many years; for more than 27 years he ran housing splendidly in Harlow. He is a good local government officer, and I suspect that until 10 minutes ago he was advising Harlow council.
I sought Dr. Hawes's advice, because he knows more about the government of Harlow than anyone in it. In a letter to me, he wrote:As to Harlow: the first thing is to say that it is perfectly feasible to produce good and efficient local services for a 396 budget of £11.5 millions, if only they would accept that they should do the basics well and cut the extravagances … In the medium term they need to dispose of the housing stock in a series of planned disposals to housing associations, perhaps retaining the sheltered service and developing the 'enabling' and care-in-the-community dimensions. On the assumption that a unitary authority is formed in due course, covering a wider area of West Essex, this would be an important ingredient in developing care services with Health and Social Service agencies.That says it all. That man effectively ran housing and social services in Harlow for 27 years; he is an expert in local government, and advises on local government; he advises Harlow council. He says that what the Government are doing for £11.8 million can be done well for £11.5 million. I commend the motion to the House.
§ Mr. Andrew Mackinlay (Thurrock)
We must not only consider the three councils that are the primary subject of the order; as my hon. Friend the Member for Blackburn (Mr. Straw) pointed out, every local authority is affected by it, because if the House rejected it tonight, authorities up and down the country would be liberated and allowed, in subsequent years, to fix the budgets they considered appropriate to promote and protect their communities. Therefore, a great deal is at stake.
Among the local authorities that are not included in the order, but are nevertheless affected by the capping regime, is my own council, Thurrock—referred to earlier by the hon. Member for Harlow (Mr. Hayes). It has struggled and is suffering; it had to make painful decisions in order to achieve a budget below the capping limit. I commend the political courage and judgment of Councillor Jimmy Aberdein and Thurrock's controlling group—and, indeed, the many Labour-controlled councils up and down the country that have had to make similar painful, heart-breaking decisions to come within the capping limit.
The Minister has said that he is prepared to look again at the formula by which standard spending assessments are arrived at. It is my council's view that it has been denied, because of the existing Government formula, something like £3.5 million. The formula is an absurd, unfair and crude mechanism which has been adopted by the Government in order to arrive at the standard spending assessments, with all their discrimination in favour of some of the councils controlled by their friends and to the disadvantage of many other councils, including areas which are poor, such as my own area of Thurrock in Essex.
Before I move away from Thurrock, I want to point out that my council covers a relatively poor area. Its people, are being deprived of the benefits which would have accrued from their council's innovation and enterprise in conceiving such developments as lakeside, had the Government not altered the rating system. Thurrock ratepayers would have been advantaged by many millions of pounds had the system not been tampered with. It is a great loss to a poor area when its people cannot benefit from the enterprise and initiative shown by the Labour-controlled Thurrock council. They have been robbed.
The hon. Member for Harlow (Mr. Hayes) referred to my council and tried to compare it with his own, but it is like trying to compare an apple with an orange. One of the things that he should recognise after representing Harlow for so many years is that Harlow is quite different from some other areas because it is a new town. The broad 397 thrust of the grounds for the appeal which the Minister spurned and which was submitted by Harlow council on behalf of Harlow people was that new towns have special problems.
There was also an unspoken but implied contract between Governments, both Conservative and Labour, which created, supported and sustained new towns with the people they sought to attract to live in them. There was a commitment that residents would be able to enjoy pleasant and healthy surroundings, attractive places in which to bring up their children and in which to retire. Such a quality of life was part of the deal in encouraging those people to come and spend their lives in the new towns. It is that contract, that concordat, that the Government are ratting on tonight by the order which will cap Harlow.
§ Mr. Rooker
My hon. Friend reminds me of one of my visits to Harlow a couple of years before the general election, when I was dealing with community care for the Opposition. Harlow council had put in place one of the finest day care centres that I saw in the whole of the country. Yet Harlow was not a social services authority. It had been forced to provide it because Essex county council did not wish to do so. It is one shining example of what Harlow did for its residents above and beyond its statutory duty, to meet a need that was not provided for by the then Tory-controlled county council.
§ Mr. Mackinlay
I am grateful to my hon. Friend, because he makes a point that needs to be reiterated tonight. Harlow's Labour council was using what limited powers it had to supplement the deficient services provided from Chelmsford by the Conservative-controlled Essex county council. I hope that in future that will be remedied, but the Conservative Essex county council was denying important and essential services to people in Harlow and in other parts of the county, including my own borough of Thurrock.
§ Mr. Mackinlay
I do not know where the hon. Member has been, but the Labour party throughout the county of Essex has been protesting about the acute deficiencies of the county council's services and the fact that it has been spending way below even this mean Government's assessment of an appropriate level of spending. Those Conservative county councillors have been found out and discredited. The Conservatives who hitherto controlled Essex county council have been rejected by the electorate.
I am deeply concerned about the high level of unemployment in Essex. It will be aggravated by the capping of Harlow and Castle Point, where many of my constituents work. The level of unemployment in Harlow is at an unprecedented level, and it will be made worse by the hon. Member for Harlow going into the lobby tonight to support the Government's capping of his local authority. He will be faced with the charge that his performance tonight resulted in additional unemployment in his constituency and throughout the county of Essex.
New towns are unique. They were designed to be attractive. An important feature of new towns is their open 398 spaces, with flowers and trees, and their areas for recreation. This capping order will result in those features having to be neglected. The hon. Member for Harlow rubbished the fact that Harlow had decided that it was appropriate to allocate some money for the provision of flowers. Expenditure of that kind has always been implicit in the concept, design and ethos of new towns.
The age balance in new towns is, by their very nature, distorted. Harlow in particular will have to face the fact that it has a higher than average aging population. Homelessness there is increasing, due to the inability of the council to build homes for families to rent. The nature of new towns always was that they should be allowed to develop so that children brought up there could stay there. Homelessness, however, is rising in Harlow, and it will be aggravated further by the order.
Tragically, extensive leisure facilities will be lost. They serve not only the people of Harlow but those who live elsewhere in Essex and in Hertfordshire, including people who reside in Conservative-controlled areas and who legitimately use Harlow's recreation and leisure facilities.
In view of what the hon. Member for Harlow said, it is fair to place on record the fact that Harlow council has been highly commended for its efficiency by a number of important agencies. The council has recognised the political reality that the Government have put a pistol to its head. Over the past three years, therefore, it has made efficiency savings of £2 million, even though, since 1979, the people of Harlow have been denied resources amounting to about £31 million, due to the Government's rate support grant machinations. The capping limit which is being dictated to the council tonight means that its budget will in reality be nearer £9.5 million, rather than the £11,800,000 that is stated in the order. The consequences will be devastating for many people who live in that area.
The decrease in concessionary fare facilities will lead to the use of buses going down while fares go up. That will have a knock-on effect. I have referred already to the loss of recreational facilities. Play schemes, swimming pools, day centres for the elderly and handicapped and centres that give help and advice to families will also be closed. That is a tragedy, and ultimately the charge for those losses must be laid against the hon. Member for Harlow.
Trevor Brooking, a former captain of England football team and an Essex resident, said of Harlow council:I was very impressed by the quality, range and level of sporting and recreational facilities provided by Harlow Council. I am concerned for the future well-being of local people, should services be cut as a result of reduced finance.That should be fully understood by the House. We should also take into account the general attitude of Conservatives in Harlow, whom I see represented by the Trojan horse, the hon. Member for Harlow, who has betrayed the people of the town.
The minority Conservative group in Harlow produced a bogus alternative budget, which no doubt it sent to the Secretary of State. Not only is it ill informed, but it is without substance. Had the council implemented that so-called alternative budget, it would have been acting illegally, as the budget excluded provision for debt charges and other unavoidable charges. Despite that, the so-called alternative budget exceeded the capping limit by about £1 million.
Meeting the limit would have required 85 per cent. cuts in the voluntary sector, closure of family centres and a reduction in many other important amenities. When the 399 record of this debate is read in Harlow, I hope that residents will realise that not even Tory councillors were able to meet the Government's unreasonable criteria, as reflected in the orders.
My hon. Friend the Member for Blackburn (Mr. Straw) challenged the Government and the hon. Member for Harlow to show their mandate for supporting the order. They have not been able to answer the fact that, for almost three decades, Labour has been returned to control Harlow council, and that, as recently as a few weeks ago, it was overwhelmingly supported in the county council elections. It is a painful fact that the hon. Member for Harlow was elected on 9 April 1992, but he was elected on a bogus prospectus, which we debated and exposed earlier today. Many Conservative Members were elected on a false and dishonest—or, to use a parliamentary word, fraudulent—programme.
Another area must be mentioned. It will not have escaped your attention, Mr. Deputy Speaker, that, rather unusually, and no doubt to the embarrassment of the Government, one of the orders is against Castle Point, which is a Conservative-controlled council. Indeed, it has been under Conservative control since the time of the ark. It is being capped tonight. It is not unreasonable for hon. Members to ask why. From a sedentary position, when the Minister was speaking, I shouted out, "Why has this cap been imposed?" I do not know whether it was recorded by the Official Report, but the Minister said that it was the fault of the treasurer.
That was breathtaking and somewhat cowardly, especially as the treasurer cannot defend his position here. The Minister did not take account of the comments of the right hon. Member for Kingston upon Thames (Mr. Lamont), who said earlier today, "I am astonished how we in this place blame public officials for the decisions that we politicians take."
If something is wrong at Castle Point—I assume that there is, or we should not be debating the order—we have a right to full disclosure of what has gone wrong and who is to blame. I look forward to hearing the hon. Member for Castle Point (Dr. Spink). One cannot escape the fact that ultimately Conservative councillors must be to blame for the shambles at Castle Point. I hope that the House will receive a full and frank disclosure. If that is not forthcoming, there should be an independent inquiry into what has happened there.
I hope that the House will agree that the order is unfair and inappropriate and that it discriminates against ordinary people. It is time that the House rejected capping. We should also reject the order to send out a message of hope, that there will be a change in the local government regime in the not too distant future.
§ Mr. Paul Marland (Gloucestershire, West)
I am saddened by the fact that I have to speak tonight because Gloucestershire county council need never have been charged-capped as there are many other options available to it.
I am sad for the schoolchildren of Gloucestershire because the axe will fall on them as a result of the liberal-Labour mishmash of government. It is a disgrace that the liberal-Labour coalition intends the axe to fall on 400 the 4,200 teachers in Gloucestershire. Gloucestershsire county council employs 5,800 non-teaching staff but the huge reduction will not be made among their number.
The appalling situation in Gloucestershire has arisen not in the past few years but in the past eight years since the Conservatives left office. Horrendous debts have built up. They have risen from a mere £25 million to £125 million under the Labour-Liberal coalition. It now costs £1 million a month to service those debts.
§ Mr. Knapman
Will my hon. friend confirm that, within a very short space of time, the liberal Democrat administration has, in addition to increasing the debts by about £100 million, run down substantial cash balances and often spent a considerable amount of money against the advice of council officers? Will he also confirm that the hon. Member for Cheltenham (Mr. Jones) was one of the county councillors and that he bears a considerable personal responsibility for tonight's sad necessity?
§ Mr. Marland
I thank my hon. Friend warmly for his intervention. It saves me making the next section of my speech as he said exactly what I was going to say. The liberal-Labour record on Gloucestershire county council is utterly shameful.
The capping comes as no surprise to Conservative Members because it is the second year that Gloucestershire county council has gone over budget and appealed to the Department of the Environment, supported by all Members of Parliament for the area. No effort was spared. It is the second year that the Government have carefully examined the situation in Gloucestershire and considered a variety of reports which have been produced in an effort to justify the county council's overspending. The council has been found wanting.
It is the second year that Gloucestershire county council has done nothing to help itself when there is much that it could do. It is also the second year that the citizens of Gloucester will have to pick up a bill for £600,000 for rebilling by the district council. The citizens will of course relish the £55 reduction for each household, but the Labour-Liberal coalition has a shameful record. All the other county councils can live within their budgets, so why cannot Gloucestershire county council?
§ Mr. Marland
That remark was totally out of place. The hon. Member for leicester, East (Mr. Vaz) knows what it is like to be swindled by what seems to be a respectable organisation, and I respect what he has done to help investors in the Bank of Credit and Commerce International. Precisely the same thing has happened to me and to thousands of other investors at Lloyd's, and I shall use my best offices to ensure that justice is done.
§ Mr. Marland
I shall not give way, because this is a debate about charge capping, not about financial services. I mentioned the subject only because the hon. Member for Bradford, South (Mr. Cryer) goaded me with it.
To be constructive, I ask what Gloucestershire county council should do now and in the future. First, it should drop the ridiculous idea of a judicial review. That would simply cost the citizens of Gloucestershire more money, and I do not believe that it would get them anywhere.
401 Secondly, the council should re-examine its plan to lay off 150 teachers, and look to the 5,800 non-teaching staff for the redundancies.
Thirdly, Gloucestershire should make a plan to reduce its debts. As I have already said, the council has £125 million-worth of debts—but it also has £500 million-worth of assets. It should liquidate 20 per cent. of its assets and pay its debts. Gloucestershire owns 8,000 acres of agricultural land. Why does a county council need that sort of agricultural holding? It should sell it and pay the debts. Gloucestershire is the only county in the country that cannot live within the guidelines laid down by the Government.
What should the Government do? They, too, should play a part in putting Gloucestershire on the straight and narrow for the future. I am glad that they are undertaking a review of standard spending assessments, and I am confident that it will be deep and thorough. I believe that the Government should consider the area coast adjustments, too, to find out whether any extra money could come to Gloucestershire under those auspices. They should also compare Gloucestershire's lot with that of Oxfordshire, Devon, Warwickshire and all the other counties that liberal and Labour councillors in Gloucestershire are always saying get a much better deal. That is probably not true, but I should like to be reassured that the claim has been thoroughly examined.
The sad thing about the capping is that the children will be the losers. I hope that the responsibility for that will hang heavily not only tonight but in the future on the shoulders of Opposition Members who seek to decry and belittle what is done by Conservatives. The guilty councillors are members of Opposition parties, and Opposition parties bear the blame for what is going wrong in Gloucestershire. Gloucestershire councillors have brought the mess upon their own heads. As my hon. Friend the Member for Stroud (Mr. Knapman) said, they have disregarded the sensible advice of their chief officers and ended up in the situation in which they find themselves tonight.
There is now no alternative. like my hon. Friends the other Members for Gloucestershire constituencies, I have received many letters complaining about the profligacy of Gloucestershire county council, and the people of Gloucestershire will welcome the £55 reduction for each household in the county. last year the county council was given a little extra money on the understanding that it would put its house in order. Unfortunately, it did not do so. The capping is the inevitable result of persistent overspending by the representatives of Opposition parties who sit on Gloucestershire county council.
Tonight my thoughts are with the children, with the families in Gloucestershire who have small children at school. They are the people who will bear the brunt of this folly, so it is with a heavy heart that I shall endorse the capping.
§ Mr. Nigel Jones (Cheltenham)
I welcome the Minister and Secretary of State to their new jobs.
Capping represents a denial of local democracy. Because of the shortage of time, I shall not comment on 402 Harlow or Castle Point. I want to concentrate on Gloucestershire because I live there and I have three children in state schools there.
In Gloucestershire, we had a referendum in the county council elections on 6 May. People were asked to make an important choice: did they want capping or not; did they want cuts in services or not; and if they did not want cuts, were they prepared to pay a little more for a decent level of services? The answer came back loud and clear: no cuts. In my constituency, where there are 13 county council divisions, only one Conservative clung on to her seat, with a majority of just 94 votes. In the constituency of the hon. Member for Gloucester (Mr. French), just one Conservative member held his seat, with a majority of six votes. In the constituency of the hon. Member for Gloucestershire, West (Mr. Marland), not a single Conservative was returned. Occupying the 63 seats, there are now 30 liberal Democrats, 20 Labour representatives, only 10 Conservatives and three independents.
Having been so roundly defeated, what did the Tories do after the election? Did they scuttle away to their little hole? No. They voted to put in a Labour chairman and vice-chairman of the county council. When Conservative canvassers knock on the doors in Gloucestershire next time, asking for votes to defeat socialism, we will know what to say to them: "Pull the other one, comrade."
Gloucestershire's budget problems are recent. The 1991–92 budget, set by a minority liberal Democrat administration, was at SSA. It was not capped. It involved some very difficult decisions, which I, among others, had to make—£7.8 million of savings, or cuts. The administration that followed the minority liberal Democrat administration was a very curious beast—a Conservative-Labour alliance. We call it a "Lab-a-Tory" pact. That administration set the 1992–93 budget, which was capped. After the appeal, the Minister allowed us £2.59 million more on spending. This year, the 1993–94 budget was proposed by Conservative councillors and seconded by Labour councillors. It was £10.3 million above the cap. The Government are now reinforcing that cap with the help of the hon. Member for Gloucestershire, West and others.
The Secretary of State has acted unreasonably and in bad faith. In November, the previous Secretary of State accepted that Gloucestershire should have an increase of 3.4 per cent. When the final spending limits were announced, he limited Gloucestershire to an increase of 1.8 per cent.; yet we have heard from the Minister tonight that the average increase is 3.1 per cent. So why are the Government penalising Gloucestershire? They allowed Bedfordshire 3.5 per cent., Kent 5.2 per cent., East Sussex 7.6 per cent., and West Sussex a massive 10.1 per cent. increase. Why has Gloucestershire been given only a 1.8 per cent. increase?
The hon. Member for Gloucestershire, West says that the council has excessive debts of £121 million. I find that very hard to take from a supporter of a Government who are borrowing more than that every day of the week. Gloucestershire's borrowings are not out of line—they are not significantly above the national average. Moreover, every penny of its borrowings was authorised by the Government with the backing and the vote of the hon. Member for Gloucestershire, West. So, on closer examination, we find that his criticism is sheer hypocrisy.
How does the Minister justify to parents increasing class sizes and damaging the education of 403 Gloucestershire's children? Gloucestershire is one of the lowest spenders per pupil; it is 76th out of 102 on primary education, 100th out of 101—bottom but one—on secondary education. Why do the Government think that it costs less to educate children in Gloucestershire than anywhere else? How does the Minister explain the gap in funding for the local police? The Home Secretary tells our chief constable that he can employ 1,184 officers, but there is not enough money in the capped budget to do it. That means that 40 officer posts and 73 civilian posts will be held vacant when we have a crime wave and regular invasions on new-age travellers. It is utter lunacy. Do not Government Departments talk to each other?
How does the Minister think that we are going to pull Britain out of recession when, by this action today, the Government will make 250 people in Gloucestershire redundant, more than half of them teachers? Why have the Government ignored the people of Gloucestershire? Why have they ignored the 25,000 parents who signed a petition against the cuts, which was presented to No. 10 Downing street? I think that I know why. It is because they see no sense, they hear no sense, and they speak no sense. Their ears have healed over. They are not a new user-friendly, listening Government; they are the same old crew, shuffling around and sinking into a morass of their own making. The people of Gloucestershire are paying the price of the Government's incompetence.
What will the four Gloucestershire Conservative Members do tonight? Are they going to go down the children of Gloucestershire and vote to cut Gloucestershire's police force? If they do, they might as well close down the Conservative office, because the people of Gloucestershire will never forgive them.
§ Mr. Doug Henderson (Newcastle upon Tyne, North)
I welcome the hon. Member for Skipton and Ripon (Mr. Curry) and the right hon. Member for Suffolk, Coastal (Mr. Gummer) to environmental matters. We all look forward to their future contributions and especially to those by the Secretary of State, to see what the learning curve has meant to him since he was so firmly committed to the poll tax some time ago.
It is unfortunate that we do not have longer to debate these matters. There has clearly been great interest by hon. Members as important issues are at stake. Perhaps, in future, Government managers will consider allocating a similar period to that which was allocated in 1990. Nevertheless, in a short time, we have had a good debate.
The Minister said that he believes that the council tax is fair. He is new to the job. When he takes a little time to understand the issues, he will find that that is not the view to many people, especially people at the bottom end, on bands A and B, who find that they are paying only a third of the council tax of people in large castles. They do not believe that it is fair. Single people in particular who are in band A and B homes find that they have a very raw deal.
The Minister said also that he intended to review the standard spending assessment system. There is a large job to do. The Minister has to explain why areas on Tyneside that, on any estimation, are deprived are not given the same rating as Wandsworth or Westminster, and why Huntingdon is considered to be more deprived than Chester.
404 We had a theatrical performance from the hon. Member for Harlow (Mr. Hayes). He condemned the flower-planting in his borough. It is interesting that in a previous debate on this subject he supported the publicly owned theatre in his borough. His contribution might have been a rehearsal for the Christmas pantomime. If he is asked to play a part, he will be known as Dame Interflora. It ill becomes the hon. Gentleman to criticise the job losses that have occurred because of the actions that have been forced on his council. His Government have caused the loss of thousands of jobs in the manufacturing sector in an important town in Essex.
My hon. Friend the Member for Blackburn (Mr. Straw) explained the real reasons why the order should be opposed. It should be opposed because it is undemocratic. The Government say that they want to give power to people locally. They have harped on about that ever since they were elected in 1979. Capping regulations do the very opposite, because they deny local people the right to decide the services that they want in their borough and how much they are prepared to pay for them. My hon. Friend the Member for Blackburn also pointed out that even if the capping regulations are intended to reduce the level of expenditure, they do not work, as the london school of economics survey has shown.
We also had an interesting contribution from my hon. Friend the Member for Thurrock (Mr. Mackinlay). He pointed out that capping is not only about the three councils mentioned in the order; it is about all councils throughout the country that face cuts in jobs and cuts in services. The Opposition are against capping orders because they are hypocrisy from a Government who said that they wanted to make peace with local government. We are against such orders because they reveal a lack of democracy. We are against such orders because of the consequences for jobs and for services. We are against the order tonight because it will not work.
§ Mr. Curry
By leave of the House, I thank the hon. Member for Blackburn (Mr. Straw), whose area has a standard spending assessment of £143 a head, for his good wishes for the area with an SSA of £86.98 per head, which is slightly below that of Thurrock. That disposes of the suggestion of political bias in the SSA system. The figure for Newcastle is £749 per head. I do not resent that. I started my professional career in Newcastle on the Newcastle Journal and I look forward to further visits to that part of the world.
The speech by the hon. Member for Blackburn was extremely entertaining. His misfortune was that I rather than my right hon. Friend the Secretary of State was dealing with the debate. He had a magnificent compilation of all my right hon. Friend's past philosophy. Clearly I shall warn him in future so that he can learn "On Ilkley moor baht 'at", which may be more appropriate in the circumstances.
The Opposition's great tragedy is that there are only three councils for them to talk about because 416 were able to accept the capping criteria. They would have loved legions of councils to debate, but there are only three. How the Opposition milked them! They painted a Guernica-like picture for Gloucestershire, with people dying in the streets because of the cap. If all that is so bad, how was it that when, last year, we relaxed the cap for Gloucestershire by 405 £2.6 million, which was apparently needed for essential services, £1.4 million was put back into reserves at the end of the year? I find that extremely difficult to understand.
What is most important is the Opposition's attitude to public expenditure which came out of the debate. The philosophy of the hon. Member for Blackburn is "Let it rip". Clearly, his vision of virtue is spending. Time and again he praised councils because they spent and spent and spent. He then said that no system of central control over local spending was acceptable. Now we know. If there is ever a Labour Government, they will let it rip. All their friends in the town halls will say, "Come on, sign the cheques. We shall fill them in." That is the policy that the Labour party has just enunciated.
The hon. Member for Blackburn prayed in aid Germany and the United States, which were very selective examples. If he had looked at some systems that are not federal, such as those in Sweden, Norway, Denmark, the Netherlands and Italy, or even at the past remarks of the hon. Member for Dagenham (Mr. Gould), he would have found that the capping of local authority expenditure is regarded as an essential component in the control of public expenditure.
What we are doing is saving the taxpayer, the one person who was never mentioned by the Opposition. The taxpayers deserve our consideration. We should safeguard the nation's finances and ensure that we get efficient and effective local government. That is permitted and that is perfectly possible under this system. It is something that local authorities are finding—
§ It being one and a half hours after the commencement of proceedings on the motion, MR. DEPUTY SPEAKER put the Question, pursuant to Standing Order No. 14 (Exempted business).
§ The House divided: Ayes 292, Noes 240.409
|Division No. 293]||[11.58 pm|
|Ainsworth, Peter (East Surrey)||Bowden, Andrew|
|Aitken, Jonathan||Bowis, John|
|Alison, Rt Hon Michael (Selby)||Boyson, Rt Hon Sir Rhodes|
|Allason, Rupert (Torbay)||Brandreth, Gyles|
|Amess, David||Brazier, Julian|
|Ancram, Michael||Bright, Graham|
|Arbuthnot, James||Brooke, Rt Hon Peter|
|Arnold, Jacques (Gravesham)||Brown, M. (Brigg & Cl'thorpes)|
|Arnold, Sir Thomas (Hazel Grv)||Browning, Mrs. Angela|
|Ashby, David||Budgen, Nicholas|
|Aspinwall, Jack||Burns, Simon|
|Atkins, Robert||Burt, Alistair|
|Atkinson, David (Bour'mouth E)||Butcher, John|
|Atkinson, Peter (Hexham)||Butler, Peter|
|Baker, Rt Hon K. (Mole Valley)||Butterfill, John|
|Baker, Nicholas (Dorset North)||Carlisle, John (Luton North)|
|Baldry, Tony||Carlisle, Kenneth (Lincoln)|
|Banks, Robert (Harrogate)||Carrington, Matthew|
|Bates, Michael||Carttiss, Michael|
|Batiste, Spencer||Cash, William|
|Bellingham, Henry||Channon, Rt Hon Paul|
|Bendall, Vivian||Clappison, James|
|Beresford, Sir Paul||Clark, Dr Michael (Rochford)|
|Biffen, Rt Hon John||Coe, Sebastian|
|Blackburn, Dr John G.||Colvin, Michael|
|Body, Sir Richard||Congdon, David|
|Bonsor, Sir Nicholas||Conway, Derek|
|Booth, Hartley||Coombs, Anthony (Wyre For'st)|
|Boswell, Tim||Coombs, Simon (Swindon)|
|Bottomley, Peter (Eltham)||Cope, Rt Hon Sir John|
|Bottomley, Rt Hon Virginia||Cormack, Patrick|
|Couchman, James||Hunter, Andrew|
|Cran, James||Jack, Michael|
|Currie, Mrs Edwina (S D'by'ire)||Jackson, Robert (Wantage)|
|Curry, David (Skipton & Ripon)||Jenkin, Bernard|
|Davies, Quentin (Stamford)||Jessel, Toby|
|Davis, David (Boothferry)||Johnson Smith, Sir Geoffrey|
|Day, Stephen||Jones, Gwilym (Cardiff N)|
|Deva, Nirj Joseph||Kellett-Bowman, Dame Elaine|
|Devlin, Tim||Key, Robert|
|Dickens, Geoffrey||Kilfedder, Sir James|
|Dicks, Terry||King, Rt Hon Tom|
|Dorrell, Stephen||Knapman, Roger|
|Douglas-Hamilton, Lord James||Knight, Mrs Angela (Erewash)|
|Dover, Den||Knight, Greg (Derby N)|
|Duncan, Alan||Knight, Dame Jill (Bir'm E'st'n)|
|Duncan-Smith, Iain||Knox, David|
|Dunn, Bob||Kynoch, George (Kincardine)|
|Durant, Sir Anthony||Lait, Mrs Jacqui|
|Dykes, Hugh||Lang, Rt Hon Ian|
|Eggar, Tim||Lawrence, Sir Ivan|
|Emery, Rt Hon Sir Peter||Legg, Barry|
|Evans, David (Welwyn Hatfield)||Leigh, Edward|
|Evans, Jonathan (Brecon)||Lidington, David|
|Evans, Nigel (Ribble Valley)||Lightbown, David|
|Evans, Roger (Monmouth)||Lilley, Rt Hon Peter|
|Evennett, David||Lloyd, Peter (Fareham)|
|Faber, David||Lord, Michael|
|Fabricant, Michael||Lyell, Rt Hon Sir Nicholas|
|Fenner, Dame Peggy||MacGregor, Rt Hon John|
|Forman, Nigel||MacKay, Andrew|
|Forsyth, Michael (Stirling)||Maclean, David|
|Forth, Eric||McLoughlin, Patrick|
|Fox, Dr Liam (Woodspring)||McNair-Wilson, Sir Patrick|
|Fox, Sir Marcus (Shipley)||Madel, David|
|Freeman, Roger||Maitland, Lady Olga|
|French, Douglas||Malone. Gerald|
|Gale, Roger||Mans, Keith|
|Gallie, Phil||Marland, Paul|
|Gardiner, Sir George||Marlow, Tony|
|Garel-Jones, Rt Hon Tristan||Marshall, Sir Michael (Arundel)|
|Garnier, Edward||Martin, David (Portsmouth S)|
|Gill, Christopher||Mawhinney, Dr Brian|
|Gillan, Cheryl||Mayhew, Rt Hon Sir Patrick|
|Goodlad, Rt Hon Alastair||Mellor, Rt Hon David|
|Goodson-Wickes, Dr Charles||Merchant, Piers|
|Gorman, Mrs Teresa||Milligan, Stephen|
|Gorst, John||Mills, Iain|
|Grant, Sir Anthony (Cambs SW)||Mitchell, Andrew (Gedling)|
|Greenway, Harry (Ealing N)||Mitchell, Sir David (Hants NW)|
|Greenway, John (Ryedale)||Moate, Sir Roger|
|Grylls, Sir Michael||Monro, Sir Hector|
|Gummer, Rt Hon John Selwyn||Montgomery, Sir Fergus|
|Hague, William||Moss, Malcolm|
|Hamilton, Rt Hon Archie (Epsom)||Needham, Richard|
|Hamilton, Neil (Tatton)||Nelson, Anthony|
|Hampson, Dr Keith||Neubert, Sir Michael|
|Hanley, Jeremy||Newton, Rt Hon Tony|
|Hannam, Sir John||Nicholls, Patrick|
|Hargreaves, Andrew||Nicholson, David (Taunton)|
|Harris, David||Nicholson, Emma (Devon West)|
|Haselhurst, Alan||Norris, Steve|
|Hawkins, Nick||Onslow, Rt Hon Sir Cranley|
|Hawksley, Warren||Oppenheim, Phillip|
|Hayes, Jerry||Ottaway, Richard|
|Heald, Oliver||Page, Richard|
|Heath, Rt Hon Sir Edward||Paice, James|
|Heathcoat-Amory, David||Patnick, Irvine|
|Hendry, Charles||Patten, Rt Hon John|
|Heseltine, Rt Hon Michael||Pattie, Rt Hon Sir Geoffrey|
|Hicks, Robert||Pawsey, James|
|Higgins, Rt Hon Sir Terence L.||Peacock, Mrs Elizabeth|
|Hill, James (Southampton Test)||Pickles, Eric|
|Hogg, Rt Hon Douglas (G'tham)||Porter, David (Waveney)|
|Horam, John||Portillo, Rt Hon Michael|
|Hordern, Rt Hon Sir Peter||Powell, William (Corby)|
|Howard, Rt Hon Michael||Rathbone, Tim|
|Howarth, Alan (Strat'rd-on-A)||Redwood, John|
|Howell, Rt Hon David (G'dford)||Renton, Rt Hon Tim|
|Hughes Robert G. (Harrow W)||Richards, Rod|
|Hunt, Sir John (Ravensbourne)||Rifkind, Rt Hon. Malcolm|
|Robathan, Andrew||Taylor, John M. (Solihull)|
|Robertson, Raymond (Ab'd'n S)||Taylor, Sir Teddy (Southend, E)|
|Robinson, Mark (Somerton)||Temple-Morris, Peter|
|Roe, Mrs Marion (Broxbourne)||Thompson, Patrick (Norwich N)|
|Rowe, Andrew (Mid Kent)||Thornton, Sir Malcolm|
|Rumbold, Rt Hon Dame Angela||Thurnham, Peter|
|Ryder, Rt Hon Richard||Townend, John (Bridlington)|
|Sackville, Tom||Townsend, Cyril D. (Bexl'yh'th)|
|Sainsbury, Rt Hon Tim||Tracey, Richard|
|Scott, Rt Hon Nicholas||Tredinnick, David|
|Shaw, David (Dover)||Trend, Michael|
|Shaw, Sir Giles (Pudsey)||Trotter, Neville|
|Shephard, Rt Hon Gillian||Twinn, Dr Ian|
|Shepherd, Richard (Aldridge)||Vaughan, Sir Gerard|
|Sims, Roger||Viggers, Peter|
|Skeet, Sir Trevor||Waldegrave, Rt Hon William|
|Smith, Sir Dudley (Warwick)||Walden, George|
|Smith, Tim (Beaconsfield)||Walker, Bill (N Tayside)|
|Soames, Nicholas||Ward, John|
|Spencer, Sir Derek||Wardle, Charles (Bexhill)|
|Spicer, Sir James (W Dorset)||Waterson, Nigel|
|Spicer, Michael (S Worcs)||Watts, John|
|Spink, Dr Robert||Wells, Bowen|
|Spring, Richard||Whitney, Ray|
|Sproat, Iain||Whittingdale, John|
|Squire, Robin (Hornchurch)||Wiggin, Sir Jerry|
|Stanley, Rt Hon Sir John||Wilkinson, John|
|Steen, Anthony||Willetts, David|
|Stephen, Michael||Winterton, Mrs Ann (Congleton)|
|Stern, Michael||Winterton, Nicholas (Macc'f'ld)|
|Stewart, Allan||Wood, Timothy|
|Streeter, Gary||Yeo, Tim|
|Sumberg, David||Young, Sir George (Acton)|
|Sykes, John||Tellers for the Ayes:|
|Tapsell, Sir Peter||Mr. Sydney Chapman and|
|Taylor, Ian (Esher)||Mr. Timothy Kirkhope.|
|Abbott, Ms Diane||Clwyd, Mrs Ann|
|Adams, Mrs Irene||Coffey, Ann|
|Ainger, Nick||Cohen, Harry|
|Ainsworth, Robert (Cov'try NE)||Connarty, Michael|
|Allen, Graham||Cook, Frank (Stockton N)|
|Anderson, Donald (Swansea E)||Cook, Robin (Livingston)|
|Anderson, Ms Janet (Ros'dale)||Corbett, Robin|
|Armstrong, Hilary||Corbyn, Jeremy|
|Ashton, Joe||Corston, Ms Jean|
|Austin-Walker, John||Cousins, Jim|
|Banks, Tony (Newham NW)||Cox, Tom|
|Barnes, Harry||Cryer, Bob|
|Battle, John||Cunliffe, Lawrence|
|Bayley, Hugh||Cunningham, Jim (Covy SE)|
|Bell, Stuart||Cunningham, Rt Hon Dr John|
|Benn, Rt Hon Tony||Dalyell, Tam|
|Benton, Joe||Darling, Alistair|
|Bermingham, Gerald||Davidson, Ian|
|Berry, Dr. Roger||Davies, Bryan (Oldham C'tral)|
|Betts, Clive||Davies, Rt Hon Denzil (Llanelli)|
|Blair, Tony||Davies, Ron (Caerphilly)|
|Blunkett, David||Davis, Terry (B'ham, H'dge H'l)|
|Boateng, Paul||Denham, John|
|Boyce, Jimmy||Dewar, Donald|
|Bradley, Keith||Dixon, Don|
|Bray, Dr Jeremy||Dobson, Frank|
|Brown, Gordon (Dunfermline E)||Donohoe, Brian H.|
|Brown, N. (N'c'tle upon Tyne E)||Dowd, Jim|
|Burden, Richard||Dunwoody, Mrs Gwyneth|
|Byers, Stephen||Eagle, Ms Angela|
|Caborn, Richard||Eastham, Ken|
|Callaghan, Jim||Enright, Derek|
|Campbell, Mrs Anne (C'bridge)||Etherington, Bill|
|Campbell, Menzies (Fife NE)||Evans, John (St Helens N)|
|Campbell, Ronnie (Blyth V)||Fatchett, Derek|
|Campbell-Savours, D. N.||Field, Frank (Birkenhead)|
|Clapham, Michael||Foster, Rt Hon Derek|
|Clark, Dr David (South Shields)||Foster, Don (Bath)|
|Clarke, Eric (Midlothian)||Foulkes, George|
|Clarke, Tom (Monklands W)||Fraser, John|
|Clelland, David||Fyfe, Maria|
|Galbraith, Sam||Mitchell, Austin (Gt Grimsby)|
|Galloway, George||Moonie, Dr Lewis|
|Gapes, Mike||Morgan, Rhodri|
|Garrett, John||Morris, Rt Hon A. (Wy'nshawe)|
|George, Bruce||Morris, Estelle (B'ham Yardley)|
|Gerrard, Neil||Morris, Rt Hon J. (Aberavon)|
|Gilbert, Rt Hon Dr John||Mowlam, Marjorie|
|Godman, Dr Norman A.||Mudie, George|
|Godsiff, Roger||Mullin, Chris|
|Golding, Mrs Llin||O'Brien, Michael (N Wkshire)|
|Gordon, Mildred||O'Brien, William (Normanton)|
|Graham, Thomas||O'Hara, Edward|
|Grant, Bernie (Tottenham)||O'Neill, Martin|
|Griffiths, Nigel (Edinburgh S)||Orme, Rt Hon Stanley|
|Griffiths, Win (Bridgend)||Pendry, Tom|
|Grocott, Bruce||Pickthall, Colin|
|Gunnell, John||Pike, Peter L.|
|Hall, Mike||Pope, Greg|
|Hanson, David||Powell, Ray (Ogmore)|
|Hardy, Peter||Prentice, Ms Bridget (Lew'm E)|
|Harman, Ms Harriet||Prentice, Gordon (Pendle)|
|Henderson, Doug||Prescott, John|
|Heppell, John||Primarolo, Dawn|
|Hinchliffe, David||Purchase, Ken|
|Hoey, Kate||Quin, Ms Joyce|
|Hogg, Norman (Cumbernauld)||Radice, Giles|
|Home Robertson, John||Randall, Stuart|
|Hoon, Geoffrey||Redmond, Martin|
|Howarth, George (Knowsley N)||Reid, Dr John|
|Howells, Dr. Kim (Pontypridd)||Rendel, David|
|Hoyle, Doug||Robertson, George (Hamilton)|
|Hughes, Kevin (Doncaster N)||Robinson, Geoffrey (Co'try NW)|
|Hughes, Robert (Aberdeen N)||Roche, Mrs. Barbara|
|Hughes, Simon (Southwark)||Rogers, Allan|
|Hutton, John||Rooker, Jeff|
|Illsley, Eric||Rooney, Terry|
|Ingram, Adam||Ross, Ernie (Dundee W)|
|Jackson, Glenda (H'stead)||Rowlands, Ted|
|Jackson, Helen (Shef'ld, H)||Ruddock, Joan|
|Jamieson, David||Salmond, Alex|
|Jones, Barry (Alyn and D'side)||Sedgemore, Brian|
|Jones, Jon Owen (Cardiff C)||Sheerman, Barry|
|Jones, Lynne (B'ham S O)||Sheldon, Rt Hon Robert|
|Jones, Martyn (Clwyd, SW)||Shore, Rt Hon Peter|
|Jones, Nigel (Cheltenham)||Short, Clare|
|Jowell, Tessa||Simpson, Alan|
|Keen, Alan||Skinner, Dennis|
|Kennedy, Jane (Lpool Brdgn)||Smith, Andrew (Oxford E)|
|Khabra, Piara S.||Smith, C. (Isl'ton S & F'sbury)|
|Kilfoyle, Peter||Smith, Llew (Blaenau Gwent)|
|Leighton, Ron||Snape, Peter|
|Lestor, Joan (Eccles)||Soley, Clive|
|Lewis, Terry||Spearing, Nigel|
|Litherland, Robert||Spellar, John|
|Livingstone, Ken||Steinberg, Gerry|
|Lloyd, Tony (Stretford)||Stevenson, George|
|Llwyd, Elfyn||Stott, Roger|
|Loyden, Eddie||Strang, Dr. Gavin|
|Lynne, Ms Liz||Straw, Jack|
|McAllion, John||Taylor, Mrs Ann (Dewsbury)|
|McCartney, Ian||Tipping, Paddy|
|Macdonald, Calum||Turner, Dennis|
|McFall, John||Tyler, Paul|
|McKelvey, William||Vaz, Keith|
|McMaster, Gordon||Walker, Rt Hon Sir Harold|
|McNamara, Kevin||Wallace, James|
|McWilliam, John||Walley, Joan|
|Madden, Max||Wardell, Gareth (Gower)|
|Mahon, Alice||Wareing, Robert N|
|Mandelson, Peter||Watson, Mike|
|Marshall, Jim (Leicester, S)||Wicks, Malcolm|
|Martlew, Eric||Williams, Rt Hon Alan (Sw'n W)|
|Maxton, John||Williams, Alan W (Carmarthen)|
|Meacher, Michael||Wilson, Brian|
|Michael, Alun||Winnick, David|
|Michie, Bill (Sheffield Heeley)||Wise, Audrey|
|Milburn, Alan||Worthington, Tony|
|Miller, Andrew||Wray, Jimmy|
|wright, Dr Tony||Tellers for the Noes:|
|Young, David (Bolton SE)||Mr. Andrew Mackinlay and|
|Mr. Allan Meale|
§ Question accordingly agreed to.
§ That the draft Council Tax Limitation (England) (Maximum Amounts) Order 1993, which was laid before this House on 7th June, be apporoved.
§ Dr. Robert Spink (Castle Point)
(seated and covered): On a point of order, Mr. Deputy Speaker. You are the defender of Back Benchers' right in the House. You will know that we have been debating the cap tonight, so it is perhaps appropriate that I should wear the cap to raise a point of order. How can I represent my constituents? Will you advocate to Madam Speaker that she should choose me to put my council's case in an Adjournment debate next week?
§ Mr. Deputy Speaker
That is not a question for me to answer. I strongly suspect that the hon. Gentleman knows the procedures of the House full well and how to apply for an Adjournment debate.