§ Mrs. Renéee Short asked the Secretary of State for the Environment if he will withdraw circular 14/81 which informed local authorities that any moneys they received from the Manpower Services Commission to promote employment would be taken out of their capital grants; and if he will make a statement.
§ Mr. King: A letter was sent by my Department to every local authority in England in August to clarify the treatment of expenditure by local authorities financed from grants by the Manpower Services Commission. Expenditure funded by the youth opportunities programme or the community enterprise programme is to be treated as current expenditure; where the commission gives grants towards capital expenditure but retains ownership over the assets bought with those grants the expenditure by the local authority should be treated as agency work on behalf of the commission. In neither case should the expenditure be scored against an authority's capital expenditure allocation. This is not incompatible with circular 14/81, but the clarification will be recorded formally in a further circular in due course.