Scotland: Community Charge (Hansard, 1 February 1989)

§ The Minister of State, Scottish Office (Lord Sanderson of Bowden)
My Lords, the figures that my right honourable friend the Secretary of State for Scotland published in November were his estimates of the community charge that each local authority would require, if it increased its spending next year only so far as was necessary to take account of inflation and of unavoidable extra expenditure on school boards and on community charge collection. The details of local authority budgets have still to be analysed, but in general where authorities have fixed charges higher than my right honourable friend's estimates it is simply because they are increasing the volume of their spending.

Lord Campbell of Croy
My Lords, I am grateful to my noble friend for that Answer. Since he appears to confirm that the Scottish Office estimates were based on reasonable expenditure and any reasonable increases, can these discrepancies be explained by councils using this radical change which is to occur in only two months' time in Scotland, thus doing away for ever with domestic rates—as a pretext for considerably enlarging their budgets?

§ Lord Sanderson of Bowden
My Lords, I thank my noble friend for that observation. Our figures show the level at which community charges could be set if moderate spending policies are followed. The fact 1086 that some councils have made large expenditure increases—I think my noble friend's own Highland region is one—and set higher community charges in no way invalidates our estimates of what those figures should be.

§ Lord McNair
My Lords, is it not a fact that there is at present a rate subsidy of 50 per cent. to encourage people to live in the remoter parts of Scotland? Will not the disappearance of that subsidy be relevant to the noble Lord's Question?

§ Lord Sanderson of Bowden
My Lords, that is not the case. What we are doing in Scotland, as has happened previously, is to remove the safety net arrangements by degrees. The charge that Strathclyde benefits as opposed to the Highland, Grampian or rural areas is perfectly valid up to a point. However, my right honourable friend the Secretary of State for Scotland has made it clear that the safety net arrangement will be phased out over a period of up to five years.

§ Lord Carmichael of Kelvingrove
My Lords, is the Minister aware I am sure he must be—and concerned that the outrun figures for most local authorities, including Conservative controlled local authorities, have come out well above the estimates put forward by the Secretary of State in November? Can the Minister tell the House whether any previous Secretary of State has issued estimates for local rates ahead of the time that the local authorities announced them? We are surprised that he did. Why did he issue these figures? Was it not enough of a problem to get this unpopular tax on the statute book without causing more distress to local councillors of all parties? The Minister must be aware that the increases of some Conservative controlled local authorities, compared with the estimates of the Secretary of State, are much higher than others.

§ Lord Sanderson of Bowden
My Lords, the noble Lord overlooks the fact that his own region of Strathclyde has managed to come within 1 per cent. of my right honourable friend's estimate of what expenditure should be. There is no validity in the argument that the Secretary of State should not put forward his views since this is a completely new way of dealing with local authorities and their expenditure. I think it is fair that the Secretary of State should estimate what the levels should be, particularly taking into account, as I said, the 6 per cent. rate of inflation. Therefore, I reject the noble Lord's argument and I believe it is only right that those who are to pay the community charge should have some basis on which to make their judgments.

§ Lord Stodart of Leaston
My Lords, within the general context of this Question, has my noble friend observed a report to the effect that particularly in rural areas many houses, although their roofs have not actually been removed, are described as unhabitable but the owners are being assessed for, I believe, the standard community charge? Is that the intention of the Government?

§ Lord Sanderson of Bowden
My Lords, I am well aware of what my noble friend is referring to on this difficult issue. My right honourable friend the Secretary of State for Scotland has been considering whether the present flexibility in the community charge arrangements is sufficient to meet the concerns that have been expressed, quite widely. We have decided that it is not appropriate for the full standard community charge to be levied in respect of empty rural cottages that are required for strategic agricultural purposes. Therefore today we shall be issuing a consultation paper setting out proposals for an alternative treatment for such properties.

§ Lord Taylor of Gryfe
My Lords, can the Minister confirm that Strathclyde region, which represents a large part of Scotland and is Labour controlled, has more or less met the target of the Secretary of State for Scotland and that it is authorities that are not Labour controlled that have exceeded the target laid down by him? I refer to the Grampian and Highland regions and also to the Borders region. Can the Minister also tell us whether his estimate of the cost of collection of the community charge is at least twice the cost of the present system of collecting rates?

§ Lord Sanderson of Bowden
My Lords, I shall refer to the last part of the noble Lord's question. The Government took into account a level of 7 per cent. in the estimates relating to non-payment and also for those areas that will be discounted. Of the local authorities, Tayside has taken 10 per cent. and, as the noble Lord knows, Strathclyde has taken 5 per cent., as has Lothian. So there is a variation as to what the actual payment levels will be.
As regards the general point made by the noble Lord about the levels of increase, there are many levels of varying increases. But there are several that show a decrease on the actual amount that the Scottish Office has published. They number Caithness, Argyll and Bute, Cumbernauld, Cumnock, Doon Valley, Cunninghame, Kilmarnock, Loudoun and of course Shetland, which is a special case.

§ Lord Taylor of Gryfe
My Lords, I am sorry but the Minister appears to have misunderstood me. I am talking about the cost of collection of the tax and not the number of people who will not pay it because of the non-payment to which the noble Lord referred. Will the Minister care to answer the first question?

§ Lord Sanderson of Bowden
My Lords, I believe that the answer to the first question is contained in my original Answer. There we took into account inflation, unavoidable extra expenditure on school boards and community charge collection.

§ Lord Hughes
My Lords, can the Minister say on what the Scottish Office bases its figures and where it obtained the numbers who are likely to be involved? Can the Minister also tell us the percentage who it is expected will be making payment? I understand that in Perth and in Kinross, where I live, the Government estimated that 94,000 people would pay, but the registration officer has been unable to find 5,000 of them. Therefore the local authority can base its figure 1088 on only 89,000. It has been estimated that 92 per cent. of that 89,000 will pay. Can the Minister tell me where the Secretary of State obtained his figures and what percentage he expects will be making the payment?

§ Lord Sanderson of Bowden
My Lords, as the noble Lord knows, registration has been taking place and, contrary to what some Members opposite thought, 99 per cent. of people have registered. Therefore there is a basis on which to assess what the levels should be. The actual calculations are based on the past year's expenditure by those authorities. Due cognizance has been taken of inflation of 6 per cent., to which I have already referred.

Lord Campbell of Croy
My Lords, I believe that the estimates published in November were helpful to the public in Scotland, most of whom wanted to have some idea of what the figures would be when this drastic change in domestic rating becomes the community charge. Can the Minister tell us whether the Government will now publish another list showing the expenditure for each authority and each council in order to facilitate at an early stage the accountability to the local community that the Government seek?

§ Lord Sanderson of Bowden
My Lords, I thank my noble friend for that observation. The answer is: yes, we shall he assessing very closely how expenditure is arrived at by each and every district and regional council. My right honourable friend the Secretary of State for Scotland will take due notice. It will be up to the local authorities concerned to publish certain information as a result of the passing of this Act. The code of practice to he adopted is in the course of formulation.

§ Lord Hughes
My Lords, in dealing with my question the Minister gave a very interesting answer that had nothing at all to do with the question. After the noble Lord has had time to look into the matter would he be good enough to write to me about it?

§ Lord Sanderson of Bowden
My Lords, I shall be very happy to look very closely at what the noble Lord, Lord Hughes, has said and I shall write to him. In the generality of the question, I believe that it should be clearly pointed out that in drawing up these figures the Scottish Office has taken due account of all relevant considerations. They are not plucked out of thin air. It will be plain for all to see in Scotland what can he achieved if there is careful expenditure by local authorities.

§ Baroness Carnegy of Lour
My Lords, when the Government publish the list to which my noble friend has just referred in answer to my noble friend Lord Campbell of Croy, can they ensure that the basis on which the original government estimates were fixed is made public? Unless the public has faith in the Government's original list it cannot read correctly the disparity between that list and the community charge that has been fixed.

§ Lord Sanderson of Bowden
My Lords, the short answer to that is yes.