HC Deb 04 June 1996 vol 278 cc388-90
4. Mr. Pawsey

To ask the Secretary of State for the Environment how many representations he has received about the abolition of local authority capping; and how many supported abolition. [29772]

Mr. Curry

We have received a number of representations on local authority capping, and many were in favour of its abolition. We also receive many letters from council tax payers complaining about high council taxes.

Mr. Pawsey

I thank my hon. Friend for that even-handed reply. Does he agree that the abolition of capping would ensure a greater measure of responsibility and responsiveness being added to local authorities—particularly in respect of spending and spending policies? Does my hon. Friend further agree that local authorities would be less dependent on central Government for additional funding? Does my hon. Friend agree also that there would be much greater accountability and that abolishing capping would add a new dimension to local democracy?

Mr. Curry

The answer to my hon. Friend's questions is obviously yes—of course it would. If local authorities could raise more of their own expenditure, local councillors would welcome that and would be more accountable in that sense. As I have constantly said in the House, there are two sides to the question. If I were a councillor, of course I would argue that capping should go, because I would like to raise what I want to spend. Central Government must take account of the fact that 25 per cent. of public expenditure is accounted for by local council spending, so no Government can afford to neglect to take a view on that volume of expenditure, given the effective management of the whole economy. There are two rights in conflict and, sensibly, we try to find a way to reconcile them and help local authorities, while making sure that central Government's economic management remains impeccable—because the economy needs local taxpayers most of all.

Mrs. Anne Campbell

Is the Minister aware of the widespread dismay in Cambridgeshire caused by the Government's decision to cap Cambridgeshire's budget at the standard spending assessment? Surely local people ought to decide how large class sizes or the charge levied in respect of elderly people who need care should be? Those matters cannot be decided by central Government.

Mr. Curry

If it is so self-evident that such decisions must be taken by local councils and that central Government have no part to play, I am surprised that the Labour party is so strongly committed to maintaining the capping legislation on the statute book. That legislation acknowledges that, at the end of the day, central Government must take a view of total public expenditure. That is the origin of the argument about capping. I acknowledge that there is an argument from local councils about their autonomy and ability to take local decisions— I have never denied that. However, I acknowledge also as a Minister that the Government must take a view of a sensible level of public expenditure in the economy as a whole. We have been doing that, and we would be irresponsible not to do so.

Mr. Pickles

Is my hon. Friend aware that one consequence of abolishing capping would be higher council tax bills? Is he aware that, in a recent survey conducted by The Sunday Times among the leaders of 80 Labour authorities, more than half said that they would increase the bills if capping were removed? Is my hon. Friend further aware that it was estimated that, just among the authorities sampled in that survey, an extra £500 million would be taken out of council tax payers' pockets?

Mr. Curry

My hon. Friend is absolutely right. The instinct of Labour-controlled local authorities is always to want to raise more taxes. That is why I believe that if the Labour party got into office it would demonstrate exactly the same instinct.