Community Charge: Social Security Budgets (Hansard, 22 June 1989)

§ The Parliamentary Under-Secretary of State, Department of Social Security (Lord Skelmersdale)
My Lords, the most recent estimates were that if the community charge had been in operation across Great Britain in the year 1988–89, the cost of the rebate scheme would have been £165 million in Scotland and £1,585 million in England and Wales. However, we expect to revise these estimates shortly. Actual expenditure next year will of course depend on the actual levels at which the charge is set and on the uprating of benefit levels.

§ Earl Russell
My Lords, I thank the noble Lord for that reply. Does he agree that these are considerable items in the social security budget? Can he indicate how much of these sums represent the cost of administration, and therefore whether that is a useful method of robbing Peter to pay Paul?

§ Lord Skelmersdale
Yes, my Lords, they are certainly substantial sums. It may help the noble 309 Earl to know that provision has been made available by the Department of the Environment for the authorities' preparation costs for the community charge as a whole, including benefit. I believe that capital allocations, for computers and accommodation, for example, of £135 million and £25 million have been made available to authorities for 1988–89 and 1989–90 respectively. A further £100 million has been distributed through the rate support grant settlement for administration purposes.

§ Baroness Jeger
My Lords, can the noble Lord tell us what arrangements are being made for this money from the social security budget to go to the local authorities, which will be looking for the money from the community charge in order to carry out their services?

§ Lord Skelmersdale
My Lords, rather like housing benefit, the money from the rebated community charge will be in the hands of the local authorities in the same way.

§ Lord Stoddart of Swindon
My Lords, is the noble Lord aware that many people would be interested to know exactly how he arrived at his figures? From indications that I have received from Berkshire County Council, which is Tory controlled, my community charge—I am supposed to be one of those who will benefit—for two people will be as much as my rates are at present and for my family of four the sum will double. In those circumstances it seems to me that the Minister's figures may not be as accurate as we should like them to be.

§ Lord Skelmersdale
My Lords, £246 a year is the most recent illustrative estimate of what the community charge would have been in 1988–89 had it been in operation. That compares with an average rate bill of £480. Two community charges are roughly, as the noble Lord indicated, equivalent to one rate bill. But clearly the objective of the Government's policy is to spread the financing of local government rather more widely across all adults. Therefore another two adults in a house will mean another two adult rates of community charge.

§ Lord Stoddart of Swindon
Yes, my Lords, but is the Minister aware that Berkshire County Council has given figures which will show the average charge to be not £265 but £500 a year?

§ Lord Skelmersdale
No, my Lords, I think that must be per couple. But if the noble Lord would like to send me the evidence he has of these figures, I shall certainly look at it.

§ Lord Carter
My Lords, is it the case that everybody is expected to pay one-fifth as a minimum of the community charge? On the figures that the noble Lord has given, does it mean that the poorest will be bearing a bill of about £400 million?

§ Lord Skelmersdale
My Lords, on the figures I have given, they will be bearing an amount of 94.5p per week. Having said that, I should point out that 310 people have been given more money in income support to help towards the payment of this 20 per cent.

§ Lord Stallard
My Lords, do the Minister's figures include inner London estimates, because no borough in inner London will be charging less than £500 each for the community poll tax?

§ Lord Skelmersdale
My Lords, my figures are the expected averages across the whole country. We expect all authorities to be submitting estimates of community charge levels for next year, when the community charge will be coming in, and therefore we shall be able to do a more precise calculation of benefit expenditure later this year.

§ Earl Russell
My Lords, I appreciate the reply that the Minister gave to the noble Lord, Lord Stoddart of Swindon, that the objective was to spread the financing of local government wider. Does the circular process that he has described contribute anything towards achieving that objective?

§ Lord Skelmersdale
My Lords, if fewer people were to pay the community charge, clearly the community charge bills would be even higher. I think that the answer to the noble Earl's question is yes.