HC Deb 28 January 1997 vol 289 cc159-60W
Sir Wyn Roberts

To ask the Secretary of State for Wales when he will announce his decisions on the 1997–98 local government revenue settlement; and if he will make a statement. [13385]

Mr. Hague

I have given careful consideration to the representations that I have received on my provisional settlement proposals. I chaired a meeting of the Welsh Consultative Council on Local Government Finance on 16 December, at which settlement matters were discussed; and my hon. Friend the Under-Secretary of State met representatives of police authorities in Wales on 10 January.

Having taken account of all the representations, I have decided to confirm total standard spending at £2,931.3 million and aggregate external finance at £2,577.9 million for 1997–98. The increase in TSS is £66.3 million or 2.3 per cent. on 1996–97. The increase in AEF is £64.1 million or 2.6 per cent. TSS includes £169.2 million for community care and £340.6 million to fund police services. I believe that my proposals provide local authorities with a fair level of funding in 1997–98 given the overall level of resources available and other spending needs.

AEF will comprise £1,732.7 million in revenue support grant; £584 million in distributable non-domestic rates; £244.5 million in specific grants, including police grant; £0.2 million for Dyfed-Powys police authority to damp the effect on council tax payers in its area of a reduction of over 2 per cent. in its police grant and SSA allocations resulting from methodology changes in the police funding formula; and £16.5 million to damp council tax increases to ensure that no council tax payer in Wales faces an increase in their bill of more than 15 per cent., excluding community council precepts and discretionary non-domestic rate relief. Actual council tax levels will depend on the budgetary decisions of individual local and police authorities.

The £16.5 million within AEF for council tax reduction is less than the provisional amount of £18.3 million announced to the House on 12 December. Changes to local authority standard spending assessments from provisional to final stage and adjustments to local authorities' base budgets resulting from consultation mean that less money is needed to maintain the 15 per cent. threshold. The balance of £1.8 million is added to revenue support grant.

I propose to lay the local government finance report (Wales) 1997–98 before the House on 3 February. At the same time, I shall be laying the special grant report (Wales) 1997 and the limitation of council tax (relevant notional amounts) report (Wales) 1997–98.

I am placing final settlement details for individual local authorities and police authorities in the Library. My decisions are subject to the approval of the House of Commons.