Skip to main content

Essex (Government Expenditure)

Volume 939: debated on Friday 18 November 1977

The text on this page has been created from Hansard archive content, it may contain typographical errors.

Motion made, and Question proposed, That this House do now adjourn.—[ Mr. Thomas Cox.]

2.23 p.m.

When I requested this debate on the priorities of Government expenditure policies and their effects, especially in North-East Essex, I had in mind the fact that over the past 10 years the population of North-East Essex had almost doubled but that Government expenditure for the maintenance of necessary services had not increased by anything like that increase in population.

Last year we had a severe cut-back in the rate support grant costing £15·6 million. This year the Secretary of State for the Environment had threatened Essex with a further cut of £13 million in the year 1978–79. Essex Members of Parliament protested against such a cutback, which, in our view, on top of the cut of £15·6 million last year, would have been catastrophic. We hear today that the cut-back will be £5 million, which still means an additional 2p on the rates.

From the rate support grant announced today it is clear that the cash limits will be very tight. It will be very difficult with the money granted in the new settlement to meet a 10 per cent. pay award without a further increase in rates. It is this which makes one concerned about the Government's attitude towards expenditure in Essex.

It appears that the Government are not willing to face the reality of how much Essex, especially North-East Essex, has grown in the past 10 years and of what is needed to maintain standards in the face of a population increase, without regard to inflation. As a consequence, we face grave problems in respect of unemployment, fares, care for the elderly and a shortage of hospitals in North-East Essex, to say nothing of the tourist trade, and industry which other areas with similar rates of unemployment are getting.

There has been a 2 per cent. growth in the gross national product since 1973 despite a 192 per cent. increase in the average wage. The consequence of severe inflation has meant a diminishing national cake. In this situation I do not wish to press unfairly for increased expenditure, but I wish to see Essex, especially North-East Essex, get what is a fair share of a diminishing national cake until, once again, we get incentive and expansion, though I have no doubt that we shall have to wait for a Conservative Government to get them.

In a reply to a Question in July I learnt that there were only 16 areas in England with levels of unemployment in excess of the 10·6 per cent. in the Clacton area. Today, we in the Clacton-on-Sea area have the highest rate of unemployment that we have ever had. It is now 13 per cent. How many areas are there with worse rates? Yet, whereas development areas get special help, we get none at all. In fact, industry has been enticed away from the area. My anxiety now is that other industries may be enticed away. Why cannot the Government see to it that areas with 13 per cent. of their working populations unemployed, such as Clacton-on-Sea, get the same help with industries as the development areas?

As for tourism, why have the Government given £2·5 million to £3·5 million over three or four years to the High Pennines, Scarborough and Bude, and nothing to Clacton-on-Sea? We have a traditional tourist industry and we are close to the Continent. We should be given help equal to that of other areas which are getting help to cater for Continental tourists, especially bearing in mind the extremely high rate of unemployment which our area faces. We ask at least for a fair share of the assets being given so that our extremely high rate of unemployment can be eased.

Before I deal with the severe shortage of funds for the health services and hospitals I wish to mention our concessionary fares problem. I say at once that I am convinced that there should be a national scheme and not, as at present, schemes which have grown up piecemeal and which are now being operated differently in many parts of the country.

Areas with large numbers of pensioners, especially rural areas, simply cannot afford the kind of free travel schemes which have been adopted in such places as London, Merseyside, Liverpool, Leicester and Nottingham, to name just a few areas where pensioners get free travel. Is it fair that some 70 per cent. of total expenditure on concessionary fare schemes should be in Greater London and the metropolitan counties, which have only 38 per cent. of the elderly population?

I have 3,300 retirement pensioners in my constituency, and to give them all free travel would cost £1 million on the rates. If we adopted such a policy it would mean that the burden of travel costs would be switched from those who cannot afford to pay to those who can hardly afford to Day. To say that areas such as mine which have not adopted concessionary fares are mean—as the Minister said during the recess—is not facing up to the obvious problems.

The Minister implies that help is available to local authorities for this purpose under the rate support grant. With the cut-back in the grant in the last two years how much does he estimate is left for such schemes as concessionary fares? Our cut-back in the last two years has been £20 million, which is equivalent to an 8p rate.

Let me examine the budget of the Tendring District Council. In all fairness the council can go no further on the matter of concessionary fares. The scheme that it has brought forward is only a proposal and it needs Government approval. When will Government restrictions on the introduction of new concessionary fare schemes, such as Tendring has introduced, be lifted? I hope that the Minister will say at once what he means when he says that global public expenditure for concessionary fares should increase by about £25 million over current levels by the end of the decade. Where does that £25 million come from—the taxpayer or the ratepayer?

It would be far fairer and cheaper to run a national scheme. The Government are trying to blind the public with science and all this mumbo jumbo about councils receiving help through the rate support grant. It is even more dangerous than that. It is double talk. On the one hand, the Government are saying that something can be done, and, on the other hand, they are saying that the funds are not available for local government to do it. This is causing a great deal of resentment, particularly in my constituency. Let us have a national scheme so that all people can understand it. Let us not hide the necessary costing and statistics, which any reasonable person will want to examine and follow. This is the way in which value for money can be obtained.

Surely the Minister can understand the resentment felt by pensioners who come from areas that are not operating free travel schemes and who are travelling alongside those who are helped by such schemes. Very often those pensioners who do not get help are from rural areas where the need is greatest. A national scheme would mean giving help to those who need it most—a half-way house between free fares for all pensioners, which would cost £200 million annually, and naturally we all want to be careful about public expenditure, and a scheme for helping pensioners like those in rural areas, which are so typical of retirement areas. Such a modified national scheme could work and help would be given to those who needed it. Also it would not mean expenditure of the kind that the Minister has spoken of. Within the limits of the money available the Government could work out a perfectly feasible national scheme that would be far fairer.

One of the most serious problems of Government spending priorities is the funding of the National Health Service in Essex over a period of many years during which the county's population has been growing steadily. The under-funding of the Health Service has become more and more serious. In the past 10 years the number of people in my constituency has doubled and the number of retirement pensioners has reached 33,000. However, the hospital services available to them have not increased by anything like that proportion. The Colchester Military Hospital, despite the good work of my hon. Friend the Member for Colchester (Mr. Buck) and protests from me, is to be closed down and the Middlesex Convalescent Home is threatened with closure.

Essex is becoming the Cinderella medical area and North-East Essex is following suit quickly. Something must be done to arrest this. The Government must see that Essex gets a fairer share of existing resources and that these are allocated properly within the North-East Thames Regional Area. North-East Essex has a population that is increasing quickly in contrast to that of the London part of the North-East Thames area where steady depopulation has been continuing for a long time. The increase of 15,300 in the last year in Essex has been marked by a large movement of elderly people backed by the GLC which is offloading part of its responsibility for the elderly on to Essex, particularly North-East Essex.

Translated into financial terms this means that we have a shortfall of at least £20 million in Essex on a budget of £100 million. This figure of £20 million deficit is a crisis figure by any standards. As the population increase continues and pressures become heavier, this discrepancy will grow even more. It is a matter of serious concern that the area, one of the three largest in the country, is suffering a hand-to-mouth existence with the unavoidable deterioration in the level of patient-care services. Hospitals are closing down or are threatened with closures and, because of severe financial cash limits, hospital wards are now being threatened also.

I am concerned with the Colchester area which covers my constituency. We have a huge retired population. Do the Government want to see the closing down of more patient services? Will the Government see whether redistribution of resources to Essex can be made as soon as possible, and that the national Resources Allocation Working Party begins work at an early date and reports annually? I pressed the Government on this in July but I have not heard any results yet.

Urgent and immediate action is imperative in order to avert a serious crisis. I trust that the Government realise that it is not an exaggeration to say that the Health Service is reaching crisis point. Those who are closely affected are already disturbed and alarmed. When can we expect improvements in our hospital services instead of continual closures? When will better facilities be provided for geriatric services in Tendering, for example, where there are 26,500 pensioners over 65 and 9,000 over 75.

We are desperately short of Part III accommodation. Under the DHSS guidelines, by 1983 there should be 22 places per thousand of the elderly population. At present there are only 312 altogether, which makes us 46 per cent. below the 1983 planned target. In 1972 the plan was for 10 residences for elderly pensioners with 48 beds in each. No start has been made on this yet and the position is deteriorating quickly.

It is strange to look at the Labour Party manifesto of 1974 and compare it with what is happening. A pledge was given then to defend the NHS.

Against this background we must witness the threatened closure of the Middlesex Convalescent Home. What is the latest news that the Minister can give me on this? In the autumn I received a petition that was signed by 7,000 people who are most anxious to hear the results. This is a matter of great importance to the health and medical resources of North-East Essex. I urge the Government to ensure that even if the money is not available in the budget for the present financial year, they will consider the plea that has been put forward by responsible Clacton doctors to maintain the fabric of the Middlesex building and grounds until money is available.

We have a precedent in the Passmore Edwards, which closed as a TB sanatorium to be redeveloped as a rehabilitation centre. Will the Minister realise that the number of people needing care for varying lengths of time is bound to increase? It is in the very nature of an ageing population. I wish to avert a crisis. I only hope that the Government understand the gravity of the situation, not only for North-East Essex, but for Essex as a whole.

I must pay tribute to the doctors and nurses who are working under such difficult conditions and under great strain. Home helps, too, play a special part in keeping people in their own homes for as long as possible. Voluntary services and, indeed, social workers are doing all that they can, as well as the families themselves, but the whole system is under great strain.

I cannot emphasise too strongly the danger of a breakdown and crisis because of a lack of funds. I want to see that we get our fair place in the queue for Government funds. I do not believe that we are getting it at the moment, either with help towards industry and tourism, or to help us with our high rate of unemployment and over concessionary fares.

I underline particularly the difficulties that we are facing over the Health Service, and I trust that the Minister will be able to promise at least some reasonable hope of hell for North-East Essex.

2.41 p.m.

The hon. Member for Harwich (Mr. Ridsdale) has chosen a very broad subject for debate today—priorities of Government expenditure policies and their particular effects in North-East Essex. In the short time available I cannot hope to do more than pick up some of the interesting points that he made.

I am sure that the hon. Gentleman is right to stress in particular the large number of older people in his constituency. In a way he points his finger at one of the shortcomings of Government, in that the problems he raises, whilst all arising from such similar causes, fall to so many different Government Departments to tackle. As such, I shall inevitably not be able to deal with some of the points as fully as I should like to be able to do, but that does not imply a lack of sympathy with the sort of problem that the hon. Gentleman has outlined to the House—far from it. I am very grateful to him for the clear and understanding way in which he introduced his subject.

The hon. Gentleman mentioned the rate support grant and the effects of the 1977–78 settlement on the county of Essex. My right hon. Friend the Secretary of State for the Environment has today announced the Government's proposals for 1978–79 to the statutory meeting of the local authority associations, and the hon. Gentleman referred to that announcement. These proposals have also been set out in a Written Answer to my hon. Friend the Member for Chester-le-Street (Mr. Radice). I do not want to go into great detail about these proposals today, because the House will have an opportunity for a full debate on them before Christmas when the Statutory Instruments giving effect are laid before the House.

In addition to that debate, I understand that my right hon. Friend the Secretary of State for the Environment has offered to see all Essex MPs to have a detailed discussion on the effects of the 1978–79 rate support grant settlement on the county as a whole, so this short debate will certainly not be the only chance to consider the effect on Essex of our proposals for next year.

One aspect of our proposals which will particularly interest the hon. Gentleman is the arrangement to limit the extent of redistribution of needs element in 1978–79. We propose to do this, first, by "damping" our needs assessment over four years—that is, combining the needs assessments for 1975–76, 1976–77 and 1977–78 with that for 1978–79—and, secondly, by making special arrangements to ensure that no authority will lose a greater amount in needs element as a result of the 1978–79 RSG arrangements than the equivalent of a 2p rate poundage.

Essex will be one of the dozen or so authorities to be protected by this safety net. I am not sure from where the hon. Gentleman got his figures of £13 million and then £5 million. Final figures are not yet available, but on the best figures currently available we estimate that in money terms the 1978–79 needs element entitlement will be £1·2 million less than in 1977–78. I hope that that goes some way to reduce the hon. Gentleman's fears.

My figures were obtained before lunch from the treasurer of the Essex County Council.

Perhaps that ought to be examined later at the meeting that the hon. Gentleman will be having with my right hon. Friend.

I should say that had it not been for this safety net the country's losses would have been greater. Indeed, in making this proposal we have had in mind the position of those authorities—such as Essex—on which the 1977–78 RSG arrangements bore heavily. We were particularly impressed with the candour and lucidity of the deputations from these authorities in explaining their problems.

We have no wish whatever to see the provision of local authority services reduced to unacceptable levels. The 2p safety net has been specifically introduced to ensure that the 1978–79 grant distribution will not lead to such reductions.

The hon. Gentleman recognised the need for restraint in the totality of the grant and levels of public expenditure generally. It follows that to meet the expenditure needs of the urban authorities, with their pressing social and economic problems, the total of grant to less-hard-pressed counties must be reduced. I have no doubt that our policies to concentrate resources in the areas with the highest needs must be the right ones. This has been the aim of successive RSG settlements.

The 1978–79 settlement necessarily has to strike a balance, between recognising problems of the authorities for whom the 1977–78 settlement presented particular difficulties, and the expenditure needs of the harder-pressed authorities. When the hon. Gentleman has had a chance to assess the settlement in detail, I hope he will agree that we have indeed struck the right balance.

The cuts in services that Essex had to impose in 1977–78 were serious. It was a difficult year, but it is not my business, nor that of the Government, to comment on the difficult choice that many authorities had to face between sharp increases in rates and cuts in services. That is an uncomfortable freedom of local authorities, but one that they rightly and properly guard jealously.

I turn to one point that the hon. Gentleman raised, and one that is often raised in this connection—that of population. The population of Essex is growing, and the hon. Gentleman suggested that the grant should have grown correspondingly. I must point out that the RSG needs element aims to compensate for differences in spending needs per head. I think that that point needs to be brought out sometimes, because it is too easily assumed that the job of the needs element is to cater for large population increases, and that is not so.

One of the topics to which the hon. Gentleman referred was concessionary bus fares for elderly people. I know he recognises that this a matter for my right hon. Friend the Secretary of State for Transport, while the provision and financing of concessions are the statutory responsibility of local authorities. Where local authorities have discretion, there will inevitably be variation of provision. While elderly people in most areas enjoy some concession, and a substantial number travel free, there are still areas, including Tendring, where there are no concessionary fare arrangements.

While some variation is inevitable, the Government consider that the present range of variation is too large. My right hon. Friend therefore undertook to review the whole question of concessions, and his conclusions were contained in the White Paper on Transport Policy. In the White Paper my right hon. Friend explained that one possibility would be a national scheme which would ensure that the money currently spent on concessions would be spread more evenly over the country, but that would mean reducing considerably the benefits that people get from the more general schemes. I should add that this is also one of the objections to the hon. Gentleman's suggestion of a means-tested scheme. Moreover, the need for help with transport cannot be measured by a means test alone. For example, a poor person who lives within walking distance of essential services may be less in need of a concession than someone better off living further away.

Another possibility that was considered by my right hon. Friend was a national minimum standard, but, unless the minimum were comparatively low, even that could be costly. Concessionary fares on bus services are in many areas the main way of giving elderly, blind and disabled people greater mobility, but they are not the only way. In some places some other form of help may be appropriate.

My right hon. Friend therefore concluded that it made most sense to leave responsibility with local authorities, but to work for more equitable and consistent arrangements.

As a first step my right hon. Friend will withdraw at the earliest practicable date the advice, given in the past few years in the context of the rate support grant settlement, that economic circumstances did not allow for the introduction of new or improved arrangements.

Secondly, the transport White Paper announced that provision would be made for local authorities to be spending an extra £25 million by the end of the decade on improved schemes in areas where the present scale of provision is too low. The additional expenditure on concessions which results will, of course, be included in the total expenditure on which rate support grant is paid.

Thirdly, my right hon. Friend proposes to give some positive advice to local authorities on the provision of concessions and he is at present consulting on its terms. This advice will not tell authorities how to run their concessionary fare schemes. Its aim will be to indicate very broadly the level of benefit which the Government consider to be appropriate.

In the Government's view, while it is for each authority to decide, generally it will be appropriate for an authority which is introducing new or improved arrangements to aim to meet about half the cost of the local bus fares that would otherwise be paid by concessionaires. My right hon. Friend hopes to be able to issue the circular, which will also announce the withdrawal of the earlier inhibiting advice, fairly soon.

These measures will have the effect of encouraging authorities like Tendring to introduce sensible arrangements. I understand, indeed, that Tendring is considering the introduction of a concessionary fares scheme when the advisory circular is issued. I am sure that my right hon. Friend will be pleased about that. I shall, of course, draw his attention to the hon. Gentleman's remarks today.

The hon. Member referred to tourist policy and tourist development areas, and he said how wrong it is to try to encourage tourism development in industrial development areas at the expense of his area. The areas are development areas, designated because of their innate economic weakness, and whilst they do of course include a good deal of industry they also comprise a very great deal of Britain's scenic beauty. Yet in many cases they are relatively unknown to tourists, despite their great tourism potential. It is that potential the Government wants to unlock, without, of course, harming the local environment.

For example, my right hon. Friend the Secretary of State for Trade announced on 20th May an important experiment involving three proposals to establish new tourism growth points in the High Pennines, Scarborough and district, North Devon and North Cornwall. The proposals are designed to try to bring employment to areas that have had longstanding economic difficulties and weaknesses.

It has been suggested that special tourism development areas should be set up. But in the present economic climate, Government assistance for tourism projects cannot be increased in real terms. The protagonists of tourism development areas are in effect asking us to halt the present tourism growth points initiative in order to provide project money for other parts of the country. I understand and sympathise with the problems of certain traditional resorts such as Clacton, but the Government are far from convinced that assistance with bricks and mortar development is the sole or, indeed, the most useful course in all cases.

Marketing and self-help by resorts themselves and local industry to make the locality more attractive to visitors are equally important. This is as much a question of techniques as of money and, indeed, for appropriate projects which would not otherwise get done it may sometimes be practicable to make use of the job creation programme.

Before I leave this question I want to emphasise that, although a good deal is said about tourism project aid, by far the largest proportion of the Government tourism budget is spent in ways which benefit the whole country, on tourism research and development, promotion and marketing at home and abroad, on help for information services and the work of regional tourist boards, and, of course, on training.

The hon. Member spoke of the unemployment figure of 13 per cent. in his area. He suggested that this pointed to the need for equivalent help to North-East Essex as is given to other depressed regions in England. But I am afraid I cannot accept that. The Government's regional policy, broadly speaking, is aimed at reducing unemployment in those areas where, due to deep-seated longterm structural problems associated with declining basic industry, the problems are at their worst. Unemployment in areas such as Clacton and North-East Essex, whilst regrettably high, is not of this type. It tends to be seasonal, but it has been sadly exacerbated by the recession. The best chance of improving the situation there does not seem to lie in special Government grants, but in the success of the Government's economic policies as a whole.

I turn now to the hon. Member's remarks about health services. The Government have agreed that the broad principles recommended by the Resource Allocation Working Party in its second report published last September should be followed. We are committed, as is well known, to closing the gap between the rich and poor regions and the rich and poor areas within them. However, how quickly we can move towards the working party's targets must depend on the money available to the National Health Service.

The North-East Thames Region recognises that Essex is one of its needier areas and that revenues available to that area should be increased, perhaps, in the order of 20 per cent. to be achieved over a period of years. In 1976–77 the regional health authority began a movement of revenue resources in that direction.

For this year, however, the region considers that redistribution cannot be continued at the same pace. Movement of resources away from the centre of London must allow time for the effects of rationalisations that have been made already to take place. I have been told, therefore, that the region considers that it must plan for 1977–78 to be a year of consolidation rather than development. The regional health authority has, however, selected five major hospital starts for beginning in the next decade. Two of these are at Colchester and Chelmsford. I should stress that the planning of health services locally is for local decision by the local health authorities responsible, and within the guidelines and resources provided for them.

Let me take up the points made by the hon. Gentleman about the Colchester Military Hospital and the Middlesex Convalescent Home. The decision by the health authorities not to take over the Military Hospital was not taken lightly. Lengthy consideration was given to its acquisition, but the health authorities concluded that better value for money could be obtained by improving the local services pending the building of the nucleus hospital.

The hon. Gentleman suggests that the area health authority should acquire for geriatric use the Middlesex Convalescent Home. The use of the home has been considered very carefully by the area health authority, but it considers that better value for money will be obtained from the planned extension to the Clacton Hospital. The use of the home as a halfway house has also been considered by the Essex County Council social services committee, which, I understand, is unable to find the money to provide such accommodation even on a joint-financing basis. The proposal to close the home is, I understand, at present before my right hon. Friend the Secretary of State for Social Services.

I want to re-emphasise that the Government have provided an increased share of national resources to the health and personal social services, and a fairer distribution of those resources is being pursued as rapidly as the practicalities of growth and the economy will allow. I assure the hon. Gentleman that within these constraints both the regional health authority and the area health authority are working to achieve an increase in the share of the available resources devoted to North-East Essex.

The hon. Gentleman has raised a wide variety of topics, all related and all important. Because he covered such a wide range of Departments, I am sorry that I may not have been able to give as satisfactory an answer as lie would wish, but I assure him, first, that the points he has raised will be presented to the Departments directly responsible. Secondly, his speech emphasises the need for close working together by Government Departments on the various topics that he has raised and an understanding of the special problems of the constituency and area that he represents.

Question put and agreed to.

Adjourned accordingly at Three o'clock.