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Rates

Volume 885: debated on Wednesday 5 February 1975

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23.

asked the Secretary of State for the Environment on what evidence he bases his prediction that the total rate demand for 1975–76 should not on average exceed that for the current year by more than 25 per cent.

On the basis that the Government have made a major increase in grant, and that local authorities will keep their expenditure down to the rates of growth allowed for in the settlement and rate realistically.

Is the right hon. Gentleman aware that the Greater London Council announced yesterday that it anticipated an increase of 80 per cent. over last year? Rugby has already announced a 61 per cent. increase and Westminster has announced a 70 per cent. increase. The Deputy-Leader of the GLC has indicated that the London boroughs will show an average increase of no less than 50 per cent. Will the right hon. Gentleman tell the House where the balancing figures are to come from to bring about the Government's pledge of 25 per cent.?

It might be as well to remind the House of what my right hon. Friend said at the time, namely:

"if, and only if, local authorities stick to their side of the bargain, I reckon that the average increase—I stress the word 'average'—will be about 25 per cent.…"—[Official Report, 12th December 1974; Vol. 883, c. 788.]
Of course, when there is an average many increases are above the average and a number are below it. It is surprising that I never seem to receive any representations from those who are below the average.

Will my right hon. Friend point out the importance of making clear the basis on which these figures are calculated, as in some cases areas have been extremely fortunate in their position in the past?

That is a very fair point to make. While I am making fair points I remind the House—[Interruption.] I always make fair points. This has been the largest Government grant to local authorities in history. It has increased by virtually two-thirds from £3,431 million to £5,434 million.

Does not the Minister recognise that in spite of that the increase in the rates this year is likely to be the highest on record, with the possible exception of last year? Will he publish a list of the authorities that he thinks will be below the average so that we may see whether they exist and where they are? Secondly, may we ask what he is doing about local authorities such as the London borough of Wandsworth? That authority has frankly said that it has not the faintest intention of abiding by the guidelines and that it will go ahead fully with public expenditure and let the ratepayers jolly well get on with it.

I understand that there has been a denial of the newspaper report concerning Wandsworth. I wish that there had been denial in respect of the statement made by the London borough of Barnet a few weeks ago. If a local authority decides to act selfishly and against the national interest, this can only be at the expense of other local authorities. I hope that the local authority associations will take note of this.

Will my right hon. Friend accept that the expenditure plans of local authorities are long-term and that local authorities are now suffering from the foolish policies introduced by the Conservative Government, which involved high interest rates and the famous U-turn of 1972 when they sought to get local authorities to cut back on plans to which the Government had committed them?

It was for that reason that my right hon. Friend made the most generous rate settlement in history. What we are saying to local authorities is that they may stick to last year's figure, plus inescapable commitments. This has generally been accepted throughout the country and by local authority associations as being not only fair but generous.

The Secretary of State used an important expression about local authorities sticking to their side of the bargain. If those words mean anything, do they not throw a responsibility upon the Government to pursue such bargaining?

I do not deny that. It is absolutely right. The Government have said that for their part they will not force local authorities to increase expenditure where there should be no such increase. That has happened in the past.

In view of the unsatisfactory nature of that reply—and the right hon. Gentleman must agree with that—I beg to give notice that I shall seek to raise this matter on the Adjournment at the earliest opportunity.