HL Deb 30 March 1982 vol 428 cc1269-71
Lord Northfield

My Lords, I beg leave to ask the Question which stands in my name on the Order Paper.

The Question was as follows:

To ask Her Majesty's Government how much per annum the following district councils, all of which have high unemployment levels, would be able to spend on aid to small businesses under the Government proposals to restrict such expenditure to the product of a halfpenny rate: Alnwick; Derwentside; North Devon; and Blaenau, Gwent.

The Parliamentary Under-Secretary of State, Department of the Environment (Lord Bellwin)

My Lords, the "inclusive" totals for the authorities concerned would amount to: Alnwick, £24,738; Derwentside, £62,806; North Devon, £72,001; and Blaenau, Gwent, £76,276.

Lord Northfield

My Lords, since unemployment in these four districts is running at something like 17 per cent., 25 per cent., no less than 28 per cent., and 21 per cent., does not the noble Lord think that it was something of a mistake for the Government to recommend that expenditure on assistance to small firms by these districts, in the way of training and other initiatives that they are so successfully pioneering, should be reduced to these relatively trivial sums compared with what they are able to do now?

Lord Bellwin

My Lords, I am sure the noble Lord is aware that at the present time the sums of money available to district authorities of this kind is in total over £90 million, whereas their take-up at the present time is some £12 million. But, even so, I think the basic answer is that that is why we have put out a consultation paper. When we receive the results of the consultations we shall take very careful note of them, as well as of the statements which I know the noble Lord himself has made and the statements that have been made in debates in your Lordships' House in the last week or two. We are indeed considering the point, which I acknowledge is one of much importance.

Lord Shinwell

My Lords, is the noble Lord aware that, in addition to the councils mentioned in the Question, I have received representations from Cleveland and other northern areas which say that the halfpenny is totally inadequate if they are to assist in particular small businesses? I understand the Government are anxious to help small businesses. Would the noble Lord not agree that the halfpenny rate is inadequate for that purpose: Would the Government reconsider the matter, in order to help the local councils and also the small businesses?

Lord Bellwin

My Lords, I take the point the noble Lord, Lord Shinwell, makes, but I have to say again that hitherto the take-up has not been anything like the amount available. Nevertheless, the basic point is valid and we recognise it, and that is why we have the consultation paper and why we are listening to what noble Lords have to say on this matter. Helping small businesses is indeed a key priority for the Government. I would also point to the some 60 measures this Government have taken to do that, which we would claim is more than any Government have ever done before in this country.

Lord Cledwyn of Penrhos

My Lords, is the noble Lord aware that we welcome the 60 measures, but is he certain that they are taking effect in the areas where the need is greatest? The need is greatest in areas like Blaenau, Gwent, and the other areas mentioned by my noble friend, and the areas of North Wales where I live, where unemployment is unacceptably high and where Government help does not seem to be having any effect on the problem of rising unemployment. The noble Lord said that consultations are going on. What does he mean by that? This is an answer very often given by Governments to get themselves off the hook. How long are these consultations going to take? The longer they take the longer there will be unemployment, and this is the problem we want the Government to solve quickly.

Lord Bellwyn

My Lords, I am sure the noble Lord has read carefully the consultation paper to which I referred, which, as he will know, is due to be returned by 30th April. Until that is returned clearly one cannot come to conclusions. As was said as recently as last night in your Lordships' House, this matter is of concern and is being treated as such.

Lord Glenamara

My Lords, is the noble Lord aware that Derwentside District Council, which is one of those mentioned in the Question, produced a report recently which showed that unless 7,000 jobs are produced immediately unemployment in that area will rise to 40 per cent. before the end of this year? Is he aware that the ratio of unemployment to vacancies in the Derwentside District is 88:1, and does not this kind of situation call for very much more urgency than the right honourable gentleman has displayed today?

Lord Bellwin

My Lords, it is not "the right honourable gentleman", as I am sure the noble Lord would agree. The fact is that what we are proposing here is another form of allowance to enable local authorities to do things beyond those they are able to do at the present time, consistent with certain other constraints upon them. It is really the question of whether or not this is adequate which is a matter of debate at the moment. In many of the areas of the country this halfpenny rate is additional to the 2p rate which may be spent under Section 137 of the 1972 Act; in those cases it is additional. The problem which the noble Lord, Lord Northfield, is bringing up arises because it is in areas like those he mentions, as well as others, that the proposal in the consultation paper is that there should be a reduction from the 2p to the halfpenny. That is what we are looking at at the present time. But can I say before I sit down that it is not Governments that create jobs. Governments create climates; they do not make jobs.

Lord Nugent of Guildford

My Lords, would my noble friend say what effect each extra penny on the rates has on throwing people out of jobs because of the excessive burden that businesses have to bear?

Lord Bellwin

My Lords, clearly I cannot state specifically what that effect is because of the wide difference in different authorities, but that there is an effect upon employment caused by excessively high rates is now beyond any question.

Lord Kaldor

My Lords, would the noble Lord not agree that, if it were not for ideological inhibitions, central Government might be a much more efficient agent for helping areas like Derwentside, rather than leaving it, indirectly, for local government to act: There are areas where these problems are so big—

Several noble Lords


Lord Bellwin

My Lords, the point is that at present local government has powers to act. It is intended in the consultation paper that there shall be a certain reduction of those powers. But at present the authorities do have powers to act beyond what is in the consultation paper.

Baroness David

My Lords, is the Minister aware that the training centre which the Fenland District Council is running with Manpower Services Commission money has to count against the 2p rate given under the 1972 Act? Would that sort of consideration be taken into account when the Government are finally deciding what they should do as a result of consultations?

Lord Bellwin

My Lords, the noble Baroness makes a very fair point. I would only want to know in the case which she has mentioned whether the authority was, in fact, at present taking up the whole of its allocation. Clearly I do not know and possibly at this moment the noble Baroness does not know. However, the noble Baroness's point about the extent to which training or, for that matter, anything else, is included or excluded, is of importance and I am hoping that that will be something that will be shown up when we get the returns on the consultation paper.

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