Rate Support Grant Settlement (Hansard, 2 December 1981)

§ Mr. Younger

Full details of the settlement will be discussed with the Convention of Scottish Local Authorities later this month. My main proposals, which are being conveyed to the Convention today, are as follows.

For 1982–83 I am proposing a cash figure of about £2,450 million for local authorities' current expenditure—excluding loan charges—in Scotland. It implies a continuing need for substantial reductions in their expenditure. With the addition of provision for loan charges the total of relevant expenditure would be some £2,900 million. Grant in 1982–83 would, subject to what I say in the following paragraph, amount to 64.2 per cent. of the total expenditure figure, a reduction of 2.5 per cent. in the corresponding percentage for 1981–82.

However, I have already informed the convention that the amount of grant to be paid through increase orders relating to 1980–81 and 1981–82 together with the aggregate amount of grant for 1982–83 will be affected by the high levels of expenditure incurred by authorities in 1980–81—over and above the actions already intimated to them in respect of undue levels of expenditure in the current year.

To take account of this I do not propose to pay further grant amounting to £15 million which would otherwise have been paid for 1980–81; grant for 1981–82 and 1982–83 will require to be £35 million less than would have been the case, but for the high level of expenditure. I shall decide the balance to be struck in distributing this £35 million between the two years after further consultation with the convention.

I shall in due course issue indicative current expenditure guidelines to help individual authorities plan for levels of expenditure consistent with the settlement. I very much hope that all authorities will recognise the need for restraint in planned expenditure, in the national economic interest and in the interests of their retepayers, but I shall not hesitate to exercise my statutory power to reduce rate support grant—subject to the approval of the House—if that proves necessary to discourage individual authorities from incurring excessive and unreasonable levels of expenditure.

147W

I shall also be discussing later this month with representatives of the Convention of Scottish Local Authorities the details of the 1982–83 settlement for housing support grant including the assumptions to be made about rents.

I am satisfied that these proposals will enable authorities to maintain an adequate standard of services and that, if their budgets comply with the expenditure figures proposed by the Government, any average increase in rate levels should be very moderate.