Council Tax (Hansard, 11 April 1994)

Viscount St. Davids
My Lords, the Government welcome the fact that the average headline council tax 1278 for 1994–95 represents an increase of only 2.2 per cent. over 1993–94. Only in respect of a tiny minority of authorities—just three out of 419—have the Government had to take action to restrain an excessive increase in budgets in order to protect council taxpayers.

§ Lord Boyd-Carpenter
My Lords, I thank my noble friend for that, on the whole, encouraging reply. However, is it not a fact that the restraint in the increase in expenditure largely derives from the knowledge in local authorities of the capping powers of the Government? Will my noble friend tell the House which are the three authorities that will be capped?

Viscount St. Davids
My Lords, local accountability remains fundamental to the council tax system, but it has not in itself proved a sufficient restraint on all local authorities. However, I note that, where authorities are facing elections this year, council taxes are down; where there are no elections this year, they are up.
On the second part of my noble friend's question, the three authorities which have been capped are Langbaurgh, Sheffield and Slough.

§ Lord Mellish
My Lords, is the Minister aware that in Lewisham my council tax has increased from about £560 to about £700? How does one explain that, and with the local elections on?

Viscount St. Davids
My Lords, the noble Lord's council tax assessment is a matter for the local authority. As Lewisham is not on the list of those authorities which are capped, it is within the bounds.

§ Lord Dean of Beswick
My Lords, is the Minister aware—he must be—of the recent report showing that tens of thousands of people are being charged too much because their houses were placed in the wrong band and the valuations were not done thoroughly? What will the Government do about those people? Can they claim their money back?

Viscount St. Davids
My Lords, residents had eight months in which to make proposals for a change in the banding of their property. A significant number of proposals have been made and these are being considered. About a quarter of a million have already been dealt with and 80 per cent. should be cleared by the end of the year. The Public Accounts Committee has yet to consider the report, but the department will obviously take careful note of the committee's views.

§ The Lord Bishop of Sheffield
My Lords, can the Minister explain why the capping of Sheffield seems to be in order to enforce a reduction of the council tax rather than to prevent an increase?

Viscount St. Davids
My Lords, the right reverend Prelate will note that the proposed cap on Sheffield is because its expenditure was excessive.

§ Lord Williams of Elvel
My Lords, can the noble Viscount define what excessive expenditure is? Is it expenditure which is above the standard spending assessment produced by the bureaucrats in Whitehall? Is that the answer? If so, is it not the case that less than 1279 20 per cent. of local authority revenue comes from the council tax? The rest comes from the revenue grant from central government.

Viscount St. Davids
My Lords, the council tax raises approximately 15 per cent. of local authority expenditure; 85 per cent. therefore comes from government grants. The Government have a responsibility to charge payers to keep the amounts down.

§ Lord Colnbrook
My Lords, will my noble friend join with me in congratulating my local authority, Wandsworth, which, unlike that of the noble Lord, Lord Mellish, has reduced my council tax by £50?

Viscount St. Davids
My Lords, my noble friend is quite right to congratulate Wandsworth on keeping down the council tax.

§ Lord Williams of Elvel
My Lords, I asked this supplementary question before the noble Lord, Lord Colnbrook, put his question. Which numbers do the Government wish to keep down? Is it purely a matter of the council tax in Wandsworth? If that is the case, they have, and have used, a perfectly good expedient; namely, to subsidise the Wandsworth council taxpayer.

Viscount St. Davids
My Lords, the Government have a responsibility to taxpayers to keep down the cost of local authority expenditure, just as they do in regard to national expenditure.

§ Lord Boyd-Carpenter
My Lords, is my noble friend aware that in his Answer he indicated that appeals against banding are still going on and will do so for many months; and that meanwhile the local authorities concerned are claiming tax at the banded rate? Is it not thoroughly unsatisfactory that the machine should produce a decision by way of appeal after the tax is due rather than before?

Viscount St. Davids
My Lords, the Public Accounts Committee will consider the report in May.

§ Lady Saltoun of Abernethy
My Lords, can the noble Viscount tell us whether any Scottish local authorities have increased the rate of council tax in excess of the rate of inflation?

Viscount St. Davids
My Lords, I do not have the figures in front of me, but I shall certainly write to the noble Lady.