HC Deb 16 December 1997 vol 303 cc113-4
3. Mr. Greenway

What estimate he has made of the likely levels of council tax bills in shire districts in 1998–99. [19395]

The Minister for Local Government and Housing (Ms Hilary Armstrong)

For the first time in four years, we have increased provision for services delivered by shire districts. I cannot predict the actual council tax levels for shire districts in 1998–99, as those will depend on the spending decisions of individual local authorities.

Mr. Greenway

Why are the Government robbing rural areas? Does the Minister realise that, if the North Yorkshire county council is to meet the Government's target for school budgets, it will be forced to spend not to standard spending assessment but to the cap limit'? That will involve a 14 per cent. increase in council tax. Does that not show that the Government's claim to have funded the schools spending increase is a complete sham; and will not voters blame the Government when they get a council tax rise of four times the rate of inflation?

Ms Armstrong

This year, for, the first time, the additional money is being directly funded by central Government and has gone to every education authority. Ultimately, those decisions are local ones. It is at local level that councils will decide what quality of services they are prepared to provide for the amount that local people are prepared to pay. By contrast with last year, the additional spending on education has been provided by Government grant to local authorities.

Mr. Ronnie Campbell

Is the Minister aware that the shire of Northumberland faces an 18 per cent. Increase—which is even worse than what the Tories gave us for 18 years? Is the Minister prepared to meet a delegation from the shire county council to discuss those matters?

Ms Armstrong

Of course I shall—or at least I shall have a meeting with all authorities that want one. We are encouraging many of them to save council tax payers' money by holding their meetings via video conferencing. That is better than making the time-consuming and costly journey to London from Northumberland.

I can assure the House that we shall hold proper discussions with authorities. I remind my hon. Friend that the money for education, including Northumberland's, has been funded directly by central Government. The previous Administration, in their spending targets for this year, included a redistribution from central to local government that would have meant an increase of 7 per cent. in council tax—but the actual amount is up to each local authority.

Sir Norman Fowler

The Minister cannot shuffle off responsibility, not even by videolink. Will she accept that the Government's settlement has discriminated against shire districts? The result will be that council tax bills will average over 10 per cent., with some councils forced to go even higher—as the hon. Member for Blyth Valley (Mr. Campbell) has just pointed out. Does that not go back on Labour's promise to be fair to the shire areas?

Ms Armstrong

The shire districts have been treated more generously this year than for the previous four years, so I shall take no lessons on that from those on the Conservative Benches. I remind the right hon. Gentleman of what the Conservative party said to its members last year. In a question and answer programme, it was asked: Is Labour right to claim that the Chancellor is paying for national tax cuts by increasing local taxes? The Conservative research department answered: No. The Chancellor does not set local taxes: that is a job for local authorities. For its part, the Government has provided a fair settlement. This year, an even fairer and more generous settlement has been provided. [Interruption.] The right hon. Gentleman shouts and cries, but he knows that the previous Government delivered a poor deal for local government and we are trying, in seven months, to put right the poverty of 18 years.

Mr. Tipping

Did not the previous Government have a deliberate policy of transferring responsibility for council tax from central Government grants to local council tax payers? Will the Minister confirm that the previous Government predicted council tax increases of 7 to 8 per cent?

Ms Armstrong

My hon. Friend is absolutely right. Moreover, the additional money that the Government have put into education this year is equivalent to £50 protection per council tax payer, because it comes directly from central Government and the burden is not being put on council tax payers.