§ Mr. Orbachasked the Secretary of State for the Environment what discussions he has had with the local authority associations about the proposals for a new system of capital expenditure controls contained in the Green Paper on local government finance (Command Paper No. 6813); and if he will make a statement.
§ Mr. ShoreI have discussed with the local authority associations in the Consultative Council on Local Government Finance our proposals to replace the existing system of borrowing approvals for individual projects by a new system of annual block approvals of expenditure by programmes. This would have enabled local authorities to determine their own priorities for capital expenditure within general policy guidelines laid down by central Government. The system would, however, have restricted local authorities' freedom to finance capital expenditure from sources other than borrowing.
The Government have concluded that it would be inappropriate to restrict authorities in this way and have decided in the circumstances to continue and develop the existing system, with the agreement and co-operation of the associations. We shall, of course, continue to review the system in the light of our experience of the operation of block expenditure allocations as used in the housing investment programmes and in Scotland.