§ Mr. Watsonasked the Secretary of State for the Environment what forecast he has made of local authority capital expenditure in England in 1985–86; and if he will make a statement.
§ Mr. Patrick JenkinFrom returns submitted by local authorities, I estimate that net expenditure on services covered by the main cash limit will be in the range £1,850 million-£2,750 million compared with the cash limit of £1,911 million. Expenditure by local authorities on the urban programme and derelict land reclamation is likely to be within the total of £279 million, which is the local authority element of the urban aid cash limit.
I am concerned that there is again the prospect of an overspend against the main cash limit. This underlines the importance of the review which we are conducting with the local authority associations to find an improved system of control.
I announced in the House on 18 December 1984, at column 165, that there would be no corrective action provided that outturn appeared likely to be within 5 per cent. of the cash limit (that is up to approximately £2,000 million). I recognise that authorities had to complete the recent returns at a very early stage and that there is still a considerable degree of uncertainty about the prospects for the year's outturn. I do not wish to cause unnecessary disruption to authorities' capital programmes when the figures are still so uncertain, and I propose no action at present. I shall continue to monitor the situation. If in the event there is an overrun on the cash limit it would be met from the reserve of £5 billion and would not add to the planned total of public expenditure.