§ Sir Wyn RobertsTo ask the Secretary of State for Wales when he will announce his decision on the 1996–97 local government revenue settlement; and if he will make a statement. [13086]
§ Mr. HagueI have given careful consideration to the representations that I have received on my provisional settlement proposals for local authorities and police authorities in Wales, which I announced on 28 November and 30 November. I chaired a meeting of the Welsh Consultative Council on Local Government Finance on 18 December, at which settlement matters were discussed.
Having taken account of all the representations, I believe that my proposals provide the new unitary authorities with the appropriate level of funding in 1996–97, their first year of operation. Like the rest of the public sector, the new authorities will need to assess their budget priorities carefully. However, inflation remains low and the Government have made it clear that pay increases should be met from efficiency savings and other economies.
I also believe that, subject to a small adjustment in the figures due mainly to the postponement of the transfer of responsibility for warrant enforcement work from police authorities to magistrates courts, my provisional settlement proposals provide an appropriate level of funding for police authorities in Wales.
I have therefore decided to set total standard spending at £2,867.6 million and aggregate external finance at £2,517.9 million for 1996–97. The settlement provides for an increase in standard spending of £85.6 million, 3.1 per cent. on the comparable amount of 1995–96. Total standard spending includes £149.6 million for community care and £331.7 million to fund police services. Police funding comprises £165.5 million in cash-limited police grant provided by the Home Secretary and £166.2 million in standard spending assessments.
683WAggregate external finance will comprise £1,792 million in revenue support grant, £459 million in distributable non-domestic rates, £237.8 million in specific grants, and £29.1 million to damp council tax increases arising from the disaggregation of county and district councils' 1995–96 standard spending assessments and budgets to unitary authorities.
My settlement proposals take account of a number of minor changes to specific grants within total standing spending and aggregate external finance. My decisions are subject to the approval of the House of Commons.
I have considered the representations that I have received about the potential average council tax increases which could arise if authorities budget to the maximum indicated by the provisional capping criteria which I announced on 13 December. I have decided that, in addition to the £29 million I am making available for damping within aggregate external finance, I will make available an extra £15.9 million for damping. This will be targeted so as to ensure that no council tax increase, excluding community council precepts, can exceed 25 per cent. This is a maximum figure, and I expect the great majority of increases to be well below this figure. I have assumed that authorities will make reasonable collection rate assumptions for 1996–97 and that capping principles will be adhered to. Details of the amounts proposed for individual unitary authorities under the two elements of the damping scheme are as follows:
£000 (rounded) Disaggregation Targeted Total Anglesey 0 0 0 Caernarfonshire and Merionethshire 1,450 541 1,991 Aberconwy and Colwyn 0 0 0 Denbighshire 3,139 0 3,139 Flintshire 393 248 641 Wrexham 16 1 16 Powys 0 0 0 Cardiganshire 3,684 0 3,684 Pembrokeshrie 0 0 0 Carmarthenshire 0 119 119 Swansea 0 0 0 Neath and Port Talbot 3,293 452 3,745 Bridgend 0 1,877 1,877 Vale of Glamorgan 0 0 0 Rhondda, Cynon, Taff 6,432 3,916 10,348 Merthyr Tydfil 687 394 1,081 Caerphilly 1,509 2,453 3,962 Blaenau Gwent 3,631 1,005 4,635 Torfaen 0 1,163 1,163 Monmouthshire 0 0 0 Newport 0 0 0 Cardiff 4,895 3,621 8,517 Total 29,128 15,789 44,917 Actual council tax levels will depend on the budgetary decisions of individual local authorities.
I envisage this additional assistance as a "one off", giving authorities time to adjust service expenditure and bring it more in line with their standard spending assessments. In looking at next year's settlement, I shall have regard to the efforts of unitary authorities in this respect.
684WI propose to lay the local government finance report (Wales) 1996–97 before the House, for its approval, later this week. At the same time, I shall be laying for the house's approval the limitation of council tax and Precepts (notional amounts) report (Wales) 1996–97.
I am placing final settlement details for individual unitary authorities and police authorities in the Library of the House.