§ Mr. Michael MorrisTo ask the Secretary of State for the Home Department whether he has reached a decision on new arrangements for controlling capital expenditure on the law and order services.
§ Mr. HurdThe Government's proposals for law and order services were set out in the consultation document "Capital Expenditure and Finance for Home Office Services" issued on 28 October 1988. I remain of the view that capital spending on the police, probation and magistrates courts services should generally be subject to the capital control system applicable to all local authorities proposed in the Local Government and Housing Bill now before the House.
To meet concerns about the risk of credit approvals being vired away from law and order services, thus jeopardising their capital programmes, I intend, at least initially, that credit approvals should be issued in the form of supplementary credit approvals thereby hypothecating them to those services. I do not intend to recover the specific grant element contained in receipts generated by these services, but to protect the national taxpayer's investment I propose to provide that the reserved part of such receipts should be 75 per cent. I shall also ensure that our support for capital projects is based upon Government priorities and policies through the continuation of a system of project approvals to which payment of grant would be linked. Authorities would be free to spend available resources on projects which do not secure a place in the approved programme but such spending would not attract capital grant.
I am satisfied that the arrangements I propose for law and order services will meet the objectives of the new local authority capital finance system and that authorities will be able to maintain sufficient levels of capital expenditure on those services, while exercising a strict control on Exchequer support in the form of capital grants.