HC Deb 12 January 1999 vol 323 cc104-6
12. Mr. Andrew Lansley (South Cambridgeshire)

If he will make a statement on the impact which his decision not to announce capping criteria will have on (a) transparency and (b) accountability. [63576]

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

The accountability and transparency of local authority decision making will be improved. Local authorities will no longer be able simply to take their capping limits as their budgets, and will instead have to consider carefully their needs and the funding they will receive when drawing up their spending plans.

Mr. Lansley

Does the Minister not understand that the absence of pre-signalling of capping criteria means that, to local authorities, the capping system this year, far from being transparent, is utterly opaque? Does she understand that it would be an unhappy situation if local authorities were to be capped with a small margin between their budget requirement and the capping limit? Will she give local authorities and the House two pledges: first, that an allowance will be made for very small differences between any capping criteria, so as not to require rebilling for small sums of money; and, secondly, that she will take particular account of the special circumstances of authorities that have a budget requirement that is close to their standard spending assessment?

Ms Armstrong

I am not able to tell the House today what the capping criteria will be. We are currently consulting on that matter; the consultation finishes tomorrow and we shall bring our proposals to the House. I do not accept that the system has been made more opaque. The fact is that the previous Administration introduced a system that meant that central Government determined everything. That gives local authorities little accountability to local people and little opportunity or responsibility to work with local people to achieve a budget that gets the best for local people at a price they are prepared to pay. I believe that the new system will lead to increased accountability and to greater clarity for local people.

Mr. Lindsay Hoyle (Chorley)

I believe that transparency is something on which the Labour Government were elected. I asked a similar question about the criteria used for capping, but the answer I received was "No." That is not helpful to local government, especially the council in Chorley which asked me to ask the question. Will the Minister reconsider the answer she gave and be more open and more transparent?

Ms Armstrong

We are fulfilling a manifesto commitment, and I understand that my hon. Friend was also elected on that manifesto. As long as central Government set the limits, although the system will be transparent at one level, at another it will remove all responsibility from local authorities. Local authorities should be more independent and more responsible to local taxpayers. My right hon. Friend the Deputy Prime Minister has made it clear that local authorities are charged with being responsible. If they are responsible, capping will not arise.

Dr. Evan Harris (Oxford, West and Abingdon)

May I remind the Minister that the Labour manifesto promised to end universal capping; that the Oxfordshire Labour party manifesto for the 1997 county council elections said, "Vote Labour and end capping and the cuts to local services"; but that, on taking office, the Labour Government capped Oxfordshire's budget, jointly proposed by the Labour group? Does she accept that, by not publishing in advance the capping criteria, not only is there still universal capping, but there is now random universal capping? The people of Oxfordshire will not forgive the Government for the cuts in social services and education that flow from that outright negation of local democracy.

Ms Armstrong

I met Oxfordshire county council this morning. I am sorry that the hon. Gentleman was not part of that delegation, but I take his point as part of his representations and I am not criticising him. The manifesto commitment was to remove crude and universal capping. In the manifesto, we made it absolutely clear that we would retain reserve powers. There is a national interest and we are seeking to achieve a balance between the local and national interests.