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Expenditure Of Greater London Council

Volume 987: debated on Thursday 3 July 1980

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Schedule [Expenditure of Greater London Council] to this Act shall have effect.—[ Mr. Fox.]

Brought up, and read the First time.

With this we may take Government amendments Nos. 136, 151, 218, 231, 281 and 286.

The purpose of the new clause and these amendments is to integrate the capital expenditure of the Greater London Council with the controls of part VIII of the Bill over prescribed expenditure, while at the same time allowing the GLC to continue to seek the approval of Parliament to the council's capital expenditure under the annual Money Bill procedure.

We have been impressed by arguments by the council itself and by hon. Members on both sides of the House to the effect that the GLC's position differs from that of other local authorities in three important ways. First, its borrowing and expenditure on capital account have already been subject to parliamentary control, through the annual Money Bill procedure, for the past 100 years or so. Secondly, the council's budget and the amount of its borrowing are both exceptionally large. Its expenditure on capital account is about £400 million a year. Thirdly, London itself is of unique strategic importance in the United Kingdom.

On the other hand, it would not be right simply to exclude the GLC from the new capital expenditure controls, because the Money Bill procedure controls only "expenditure on capital account". This does not cover capital expenditure charged to revenue—about £30 million for the GLC in 1978–79—or the acquisition of capital assets by means such as leasing. The Bill aims to control all capital expenditure by local authorities, no matter how such spending is financed.

The Government have reached the conclusion that the right course is for the GLC's capital expenditure to continue to be controlled through the annual Money Bill system but for the Money Bill arrangements to be brought in line with the control that is to be applied by the Bill to all other local authorities' capital spending.

These proposals, therefore, are designed to do two things: first, to remove the GLC from the scope of part VIII of the Bill, but, secondly, to alter the London Government Act 1963 in such a way that control over the GLC's capital spending is brought into line with the discipline that is to apply to local authorities generally. In particular, they give the council power to switch the provisions in the Money Bill between services and permit a specific control to be exercised over projects of national or regional importance.

Question put and agreed to.

Clause read a Second time, and added to the Bill.