HL Deb 12 October 1976 vol 375 cc286-8WA

asked Her Majesty's Government:

What steps they are taking to ensure that prudent local authorities are not punished for their success in making economies.

Baroness BIRK

I assume that the noble Lord is referring to the Government's declared intention of reducing the total rate support grant for 1976–77 and 1977–78, and would wish to see the reduced grant distributed in such a way that those local authorities which have kept within the Government's expenditure guidelines are not penalised. My right honourable friend the Secretary of State for the Environment has considerable sympathy with this view. He appreciates that an across the board reduction in grant would bear more harshly on some authorities than on others. But he has no power to discriminate between authorities at this date in the distribution of grant for 1976–77.

Any decision to discriminate in the grant distribution for 1977–78 would require the Government to take a view of the proper expenditure level of each local authority. It would involve the Government far more closely in the financial planning of individual authorities than has previously been contemplated. It would also pre-empt a decision on the issue of the right degree of local freedom posed in the Report of the Layfield Committee. My right honourable friend is not convinced that at this stage a degree of intervention is either necessary or desirable. Local authorities are independent and democratic bodies responsible to their local electorate and my right honourable friend looks to them in the present serious economic situation to continue their efforts to restrict their expenditure.

House adjourned at twenty-four minutes before seven o'clock.