HC Deb 04 February 2004 vol 417 cc751-2
6. Angela Watkinson (Upminster) (Con)

If he will make a statement on council tax increases in England. [152485]

The Deputy Prime Minister (Mr. John Prescott)

We are investing an extra £3.7 billion in grants in 2004–05. In total, we have increased grants to councils by 30 per cent. in real terms since 1997. Despite that significant extra investment, some local authorities have said that they are going to impose large council tax increases. Under those circumstances, it appears inevitable that I shall have to use my capping powers this year—and I will do so.

Angela Watkinson

Last year, the London borough of Havering had the lowest grant increase in the whole of Greater London. This year, it is second only to Kensington and Chelsea. I wonder whether the Deputy Prime Minister has a particular grudge against Havering, but will he join me in congratulating the Conservative administration in Havering, which, over those same two years, has improved public services, cut waste and controlled the runaway council tax? This year it is bringing in a council tax increase of only 6.5 per cent.—the lowest increase in nine years.

The Deputy Prime Minister

The hon. Lady will be aware that the borough of Havering received a grant increase of more than 4.4 per cent. last year, while council tax rose by 14.9 per cent. That grant increase was above inflation, as it will be for every local authority this year. Every local authority must make a judgment in this matter, but we do not want there to be high council tax increases. Given that Havering has a Conservative majority, perhaps she should get together with the 17 resident councillors on that council and produce a reasonable tax increase.

Mr. James Plaskitt (Warwick and Leamington) (Lab)

Warwick district council seems minded to impose a council tax increase of 20 per cent. Will my right hon. Friend give them some advice?

The Deputy Prime Minister

My best advice is that my right hon. Friend the Minister for Local Government, Regional Governance and Fire will be writing to the council. That will happen when any local authority raises council tax unreasonably. I will take that into account when I exercise my sophisticated view about implementing capping.