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Regional Councils (Expenditure)

Volume 22: debated on Wednesday 28 April 1982

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asked the Secretary of State for Scotland whether he is satisfied with the proposed levels of expenditure for the year 1982–83 by regional councils in Scotland.

No, Sir. Total expenditure planned by regional councils for 1982–83 is £157 million, or 7·5 per cent., above the level assumed in the rate support grant settlement. The excess planned by Lothian regional council is £66–6 million, or 22·6 per cent. I have today served notice that, subject to my conclusions on any representations, I propose to ask the House to approve a reduction in the rate support grant payable to Lothian regional council of £45 million.

I have served similar notice on Stirling district council of reduction in grant by £1·5 million.

I am considering the levels of expenditure planned by other local authorities in Scotland and will announce further measures as soon as possible.

Is my right hon. Friend aware that his statement about Lothian will be warmly welcomed by ratepayers throughout the region? On a rough estimate, based on the figure of £45 million, will he confirm that if the saving is returned to the ratepayers, as it undoubtedly will be if a Conservative Administration is returned on 6 May, it will amount to about £60 per household? Does he agree that this emphasises that the Conservative Party cares about the ratepayers?

I agree with my hon. Friend. Once again I have been almost snowed under with representations about this matter from ratepayers who are extremely concerned about the practices in these areas.

On rate reduction, it is difficult to speculate on exactly what will happen, but if the full £45 million reduction in expenditure is made, the average rebate would be about £60 per household and, for a business in Edinburgh, about £800.

:Does the Secretary of State agree that this is a profoundly unsatisfactory system, in that he asks local authorities to draw up estimates, which he then disallows? When will he get round to redefining their proper functions and give them a sensible method of raising finance?

I have not made the system difficult to operate. The small number of authorities that have been deliberately overspending in a way that distorts the entire pattern for other local authorities have made it difficult. Any Secretary of State in any Government would have to deal with that difficulty.

Is the Secretary of State aware that his statement today is a scandalous abuse of his powers and has far more to do with the crumbling support for the Tory Party at the regional elections next week than anything else? Far from a small number of authorities being out of line, is he aware that 56 out of 65 Scottish local authorities are in excess of his guidelines, which demonstrates how unrealistic those guidelines are? For example, Orkney is 25 per cent. in excess and Shetland is 79 per cent. in excess. In the light of both facts, is not the singling out of the Lothian and Stirling districts simply another act of political spite and prejudice on the part of the Secretary of State?

The right hon. Gentleman may wish to reflect more deeply on this matter when he has time, because if he were in my position he could not ignore an authority that planned to overspend by no less than 22 per cent. over the others.

I cannot suspend my statutory functions just because an election happens to be in the offing. As the right hon. Gentleman will know if he has read his papers, I have been under great pressure to announce any changes as soon as possible, because it makes it easier for the councils to make the savings.

Why does the Secretary of State not admit what he knows—that 56 out of 65 authorities are over the guidelines seven by more than 20 per cent. and that 30 are over the guidelines by more than 10 per cent.? In those circumstances, there is no justification for singling out those two authorities.

The right hon. Gentleman is totally wrong on that. He should know that we are not concerned with authorities that are over the guidelines.

The right hon. Gentleman was here when we put through the legislation, so he knows that we are concerned with authorities that are planning to incur expenditure that is excessive and unreasonable. I hope that the right hon. Gentleman will take a little time to consider what he would do if he were the Secretary of State. Is he telling the House that he would ignore entirely one authority that contributes one-third to the entire excess spending of Scottish authorities?

Does my right hon. Friend agree that it is wise to consider local authority expenditure over a period of years, because patterns emerge? Authorities such as Tayside, which has been prudent, should not be penalised because of profligate authorities such as Lothian.

I agree with my hon. Friend. It has been very hard on the authorities that have tried to save money to have experienced some penalty because of the authorities that have not tried. My hon. Friend is right about examining the expenditure over a period. As the ratepayers of Lothian region know, whereas their rates may well be 116p in the pound, the next highest regional council rates are only 93p in the pound, which is a large gap.

How does the Secretary of State intend to maintain the levels of finance to the councils when table 2 of the Government's expenditure plans shows quite clearly that, although the Scottish contribution to the United Kingdom is increasing, the amount earmarked for Scotland from the United Kingdom is falling? If that carries on until 1984, Scotland will be done out of £762 million.

I advise the right hon. Gentleman not to push that argument very far. He will find that Scotland receives, per head of population, much more than the rest of Britain under almost every head of expenditure. I hope that it will stay that way.

Order. I shall call one more hon. Member from either side, but then we must move on more quickly.

Will my right hon. Friend confirm that during the past four years rates in the Lothian region have risen by more than 200 per cent.? In those circumstances, is he not wholly justified in taking the action that he has?

I am grateful to my hon. Friend for his comment. The figure that he mentioned is almost exactly right. I must check to ensure that it is precisely 200 per cent., but the effect on ratepayers is clear and the call for action throughout the entire region has been very noticeable, especially judging from my postbag.

Will the Secretary of State remind the hon. Member for Perth and East Perthshire (Mr. Walker) that Perth and Kinross council is also over the guidelines? Will he assure the House that he intends to take against Perth and Kinross the same action as he has taken against Lothian? Does he not realise that the arbitrary use to which he has put the powers of the Local Government (Miscellaneous Provisions) (Scotland) Act 1981, and especially the cynical timing of his announcement today, will bring contempt upon himself and disrespect for the high office that he has demeaned today?

Unfortunately, the hon. Gentleman has not understood the legislation about which he is talking. As he should know, we are concerned only with an authority that incurs excessive and unreasonable expenditure. I note the implication of what he says, that he warmly supports the high levels of expenditure in Lothian region. I hope that his constituents will note his position on the matter.

On a point of order, Mr. Speaker. Is it not an offence to reproduce official notepaper as part of the propaganda campaign against Lothian region?

Order. If the hon. Gentleman will be kind enough to send that to me I shall consider the matter.