§ Mr. CatonTo ask the Secretary of State for Wales what are his plans for allocating the Welsh Block provision in 1998–99; and if he will make a statement. [20457]
§ Mr. Ron DaviesIn 1998–99, the Welsh Office budget will amount to over £7.1 billion. This provision is based on plans set by the previous administration. The Government took the view that it would not be sensible to make hasty decisions about changing existing public expenditure plans. We do not want to put money into areas where the objectives are unclear and the outputs uncertain. Instead, we are conducting a Comprehensive Spending Review of public expenditure across all Government Departments. In Wales, the Review is well underway and I expect it to be completed in the spring of 1998. This will help to ensure that we are better equipped to make informed judgments of where to target public expenditure to meet our priorities and achieve the best results. It will provide a sound basis for the Assembly to set its own priorities. In the meantime, we have recognised that there are some sectors which require immediate help and that is why we have made additional provision for health and education.
581WIn a written answer to a question tabled by my hon. Friend the Member for Gower (Mr. Caton) Official Report, 2 December 1997, columns 117–20 I have already announced the provisional settlement for local government. I have now allocated the remainder of the Welsh Block resources and the major elements are set out in the following table. It is my intention to discuss the details of the allocation at a sitting of the Welsh Grand Committee on 16 December.
In the consultation document which I issued on 27 October, I made it clear there would be difficult decisions to make. The plans which I inherited have left little scope for manoeuvre. As a consequence, while I have been able to redistribute some cash this inevitably means those programmes which gain do so at the expense of others.
For the NHS, I have allocated £2,455 million which is an increase of over £113 million or 4.9 per cent. in cash terms over 1997–98. This will provide real growth on health authority revenue allocations which will be announced soon.
I have increased the plans I inherited for the Education Sector. In addition to the £65 million extra announced for schools in the July budget, the reallocations I have made to my Block enables me to provide £175 million for the Further Education Funding Council which will provide for an increase of 2,100 students on the original plan for 1998–99. £232 million is provided for the Higher Education Funding Council which will give an extra 1,000 students over the original planning figure.
Although the Training and Enterprise budget shows a reduction from the current plans, this should be seen in the context of the range of measures which have been introduced to help unemployed people. Under these "New Deal" arrangements I expect Wales to benefit by around £190 million during the lifetime of this Parliament.
For Industry programmes, I have made provision to meet the forecast demand for Regional Selective Assistance.
I have looked closely at the budgets of all the quangos in Wales. I have taken particular interest in those which will form the Economic Powerhouse, and collectively, I have increased the amount of grant-in-aid available to these bodies to take account of the fall in the level of receipts that they will be able to generate. This will allow for a total gross programme of the combined bodies of £185 million.
Although there is a reduction in the overall provision for Roads and Transport, I am able to allow a start on some integrated transport schemes.
In the housing sector, I have allocated sufficient funding to housing associations so as to allow around 2,300 new homes to be started next year which is an increase of 500 over the plans I inherited.
I have maintained spending on the Arts bodies.
For all the other bodies which receive funding from the Welsh Office I have retained the same provision as planned, although I have increased the budget for the Countryside Council for Wales to help it progress the new agri-environmental programme.
582WI have also provided a sum of £17 million to enable suitable accommodation to be obtained to house the National Assembly of Wales.
Further to my announcement of the proposals for local government revenue spending for 1998–99 on 2 December, my officials have today written to all Welsh councils setting out my proposals for capping and council tax damping. The letter also gives councils details of their provisional standard spending assessment or SSAs—the amount included in my expenditure plans (total standard spending) for their individual spending.
My capping proposals will enable Welsh councils overall to increase 1997–98 budgets by around £125 million or over 4.6 per cent., if they see fit to do so. Each authority will have a 3 per cent. basic increase in its budget. In addition they will each receive a share of the £26.5 million I am making available for community care, education for 4-year-olds and the National Grid for Learning. Around half of Welsh authorities will also benefit from the "passporting" of year-on-year SSA increases which are greater than the cash increase they receive under the 3 per cent. basic increase.
Within each authority's SSA I propose to identify the sums relating to the extra £50 million I am providing for schools; the $41.5 million (which includes the £37.1 million in returned nursery voucher money) which I am making available for 4 year olds education; and community care.
In my Answer of 2 December I said that the increased discretion my capping proposals give local authorities mean that the average band D council tax could rise by £60. I also emphasised the need for local authorities to take full account of the impact on council taxpayers in using their discretion. My hope is that the average band D increase will not exceed £50-or one pound per week.
I accept, however, that there will be variations in tax increase between authorities, and for this reason I am proposing a community-based council tax reduction scheme for 1998–99 which will ensure that no council taxpayer faces an increase at band D of more than £70. For the majority of people, who live in properties in bands A to C the increase will be less—slightly over £1 a week for those living in bands B and C; under £1 a week for those in band A properties.
I am making £31 million available within aggregate external finance to fund the tax reduction scheme. This includes £6 million extra I am providing specifically for damping.
583W
Welsh Office Block—main allocations: 1998–99 £ million Programme 1997–98 Plans
1998–99 Plans
Local Authority Total Standard Spending 2,757.3 2,868.6 National Health Service 2,341.5 2,455.3 Further Education Funding Council 176.8 175.0 Higher Education Funding Council 236.8 232.3 Curriculum Council and Assessment Authority 9.9 9.4
Welsh Office Block—main allocations: 1998–99 £ million Programme 1997–98 Plans 1998–99 Plans Training and Enterprise 132.5 123.8 Regional Selective Assistance 70.0 61.3 Welsh Development Agency 84.7 114.0 Development Board for Rural Wales 9.5 9.0 Cardiff Bay Development Corporation 47.9 44.9 Wales Tourist Board 14.6 14.7 Central Government Roads and Transport 115.1 100.4 Housing for Wales 60.2 62.9 Welsh Language Board 3.7 3.8 Arts Council of Wales 14.5 14.3 National Library for Wales 6.0 6.0 National Museums and Galleries of Wales 12.4 12.4 Cadw (including Royal Commission on Ancient and Historic Monuments) 7.8 7.8 Sports Council for Wales 6.6 6.6 Countryside Council for Wales 23.2 23.7 Local Government Capital Settlement (not including LGR and Fire Service1) 440.8 423.8 National Assembly for Wales Capital Costs — 17.0 1 Includes non-block items and other Government Departments.