Local Government Finance (Hansard, 7 March 2001)

§ Q4. Mr. David Chaytor (Bury, North)
What plans he has to reform local government finance.

§ The Prime Minister
The local government finance Green Paper, published last September, set out options for reform, including how we distribute revenue grant to local authorities, their capital finance regime and local taxation. A White Paper setting out decisions on the way forward will be published later this year.

§ Mr. Chaytor
I thank my right hon. Friend for that reply. The issue is important for my constituents in Bury, North, who want to see a funding formula based on agreed measures of need arid not on historical accident. Will the White Paper appear early in the next Parliament; and does "early" mean in the first 12 months?

§ The Prime Minister
I am afraid that I cannot give my hon. Friend a precise answer to that last question. However, I can tell him that we understand very well the strength of feeling. As he knows, it is an immensely complex and difficult area so it is right that reforms are carefully considered, but in any event, it is worth pointing out that, particularly as a result of the extra money that we are putting into education and social services as part of the health plan, all local authorities will have received a very considerable increase in funding. We are aware, 291 however, of the complaints of unfairness in different parts of the country; that is the reason, first, for the Green Paper and then for the White Paper that will follow.

§ Mr. John Butterfill (Bournemouth, West)
When the Prime Minister looks at the reform of local government finance, will he look into why towns such as my constituency of Bournemouth receive a lower than average increase in standard spending assessment year after year—3.8 per cent. this year—whereas our rival resorts, such as Labour-controlled Brighton, get nearly 6 per cent?

§ The Prime Minister
On any basis, of course, the money that we are giving local authorities is considerably more than was given under the previous Conservative Government. I understand the complaints about the fairness of the existing system. That is the system we inherited; it was in place for many, many years, as the hon. Gentleman knows. That is precisely why we are reviewing it.