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Power Of Secretary Of State To Control Rates

Volume 57: debated on Thursday 29 March 1984

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

I beg to move amendment No. 17, in page 3, line 31, at end insert—

'(9) The Secretary of State shall not make any order under this section if it appears that any local authority as a result of the order may fail to fulfil any of its statutory duties.'.
This part of the Bill deals with the rate-capping proposals, and the procedure under which the Secretary of State would have the power to lay an order before Parliament to seek approval on rate capping. In dealing with the amendment, I do not wish to go into any great detail about the financial implications.

It is a pity that, in the debates on Second Reading, in Committee and on Report, much time was taken up with matters of finance, because the thinking behind the Bill stems from the doctrinaire monetarist theory of the Government, involving savage cuts in public expenditure and the mistaken belief that, if central Government are given more interventionist powers to control the expenditure of local government, that in itself is a good thing, irrespective of the fact that local government historically, and, indeed, in recent times, has a far better track record in meeting its expenditure targets and, to that extent, controlling its expenditure than central Government.

The Government have not fully thought out the consequences in human terms of a cut in the essential services provided by local authorities. Many of those services are laid down in statute. There is an increasing trend—for worse, not better—of authorities being forced to reduce the standards of many of those essential services. I suspect that that trend spreads south of the border. There is a distinct danger that authorities might fail to meet the minimum statutory requirements. Amendment No. 17 would prohibit the Secretary of State from making an order if, as a result, local authorities that are victims of the order would find it impossible to meet their statutory duties.

There is also a distinct danger that this one piece of legislation—if this rubbish Bill becomes an Act—could make it increasingly difficult, if not impossible, to meet the requirements of other legislation. Surely that would bring our system of parliamentary democracy into disrepute. We place statutory duties on local authorities, but deprive them of sufficient funds to meet them. An example of that is the rate support grant. We then prohibit them from even raising the revenue to meet their duties.

Earlier tonight there was an interesting debate on housing. I am sure that hon. Members on both sides of the House—even if it is expressed only by Labour Members — are concerned that the standards of housing could drop because of the proposals for the capping of the rate fund contribution to the housing revenue account and the general rate-capping proposals. The proposals will have an adverse effect on the living standards of many council house tenants and their families. The average rents have more than doubled since this iniquitous Tory Government took up the reins of office in 1979.

The Scottish Select Committee, among other bodies, has pointed to the deteriorating standards of dampness in many council houses. Legislation for rate capping and for limiting the amount that local authorities can take out of rates to put into the housing revenue account will make it increasingly difficult for them to deal with many of the housing problems. I do not wish to dwell too long on housing, as we debated it earlier.

There is a statutory duty to provide adequate education services. I am sure that all hon. Members receive complaints from their constituents about the difficulties faced by many of our children in their schools. No doubt the Minister will tell us that expenditure per pupil is the highest that it has ever been. That is more a reflection of the drop in school population——

The Minister knows that it is true. Expenditure per pupil is now higher than ever because of the drop in school population rather than because of the Government's generosity.

The Minister does not understand the economics of education. He imagines that if a school population decreases by 10 per cent. or 20 per cent., expenditure per pupil can be automatically reduced by the same amount. Education does not work that way.

Does not the hon. Gentleman's argument imply that he is more concerned with preserving over-manning among teachers than looking after the interests of the pupils? With higher expenditure per pupil, it should be possible to provide a higher standard of education.

The hon. Gentleman does not have any educational experience, other than the disadvantage of having attended St. Andrew's university.

I shall not withdraw. I urge the hon. Gentleman to visit schools in his constituency to look at the quality of education that can be achieved in smaller classes.

A great deal of well-researched evidence shows that if class sizes are reduced that can lead to an improvement in educational standards. When I argue for a reduction in class sizes, I am not arguing for more jobs for teachers —I am arguing for increased educational standards leading to increased educational attainment for thousands of children in Scottish schools. Many children are herded into composite classes, not for any educational reasons—although there might be some in certain cases—but simply because the local authority cannot afford to meet the optimum class size. Children of different age groups are herded into composite classes, which leads to a lessening of educational opportunities.

Recently, the Government have almost admitted that, because of the financial straitjacket, local authorities will find it increasingly difficult to meet their statutory obligations. In recent years there has been a weakening of statutory obligations—for example, in nursery provision —because of an Act passed during the last Parliament. It was to remove any doubt or ambiguity about a local authority's obligation to provide nursery education that. the Government made it clear in previous legislation that they would abolish that statutory duty. As a result. many schoolchildren are being deprived of the education which should be their birthright.

The Under-Secretary of State is completely disinterested because he knows nothing about Scottish education. His sidekick, the Under-Secretary of State with responsibility for education in Scotland, knows that I have made many representations on behalf of parents in the Bannock area of my constituency, who have been pressing the Central regional council for some time for nursery school provision. It is an area in which many young families require their children to receive nursery education. I am sure that the local authority would dearly love to provide nursery education tomorrow or next year, but it is not receiving the necessary funds from central Government. The difficulty is not confined to capital expenditure—for example, getting an allocation from the Government to enable a building to be erected. In some areas, the capital allocation has already been made and the space is available.

I am talking to my amendment, which is directed to the difficulty of meeting statutory functions. I am providing an example of the way in which the Government are trying to reduce statutory obligations. The Minister is trying to do your job, Mr. Deputy Speaker, as well as his own. If he is as incompetent in chairmanship as he is in performing his ministerial functions, I hope that he never takes the Chair in this place.

The problem that the hon. Gentleman has highlighted in the Central region is experienced in many other parts of Scotland. In the short time since the 1983 general election, I have discovered that the Plockton and Kyle of Lochalsh area in my constituency, which is in the Highland region, would dearly love to provide preschool and nursery education. It is prohibited from doing so, although the necessary buildings are available, because the finance is not available from central Government. If the authority provided that extra support from the community, it would be penalised by the rate-capping measures. This makes nonsense of the Government's claim that they are concerned about social welfare.

The hon. Gentleman is correct. If a local authority wants to raise more revenue from rates to provide nursery teachers for existing nursery school accommodation so that pre-school children can be educated, the Secretary of State can step in and say, "No, we are not having that. We are setting a limit on how much you can raise on revenue through the rates." As a result, there will be less education provision in many areas.

It is interesting that many of us have received letters recently about the deplorable situation in the Western Isles, where there is a grave and imminent danger of the education authority failing to meet statutory standards of education. The proposed cuts in that area are the worst throughout the whole of Scotland. I do not point the finger entirely at the door of the Western Isles council. I point it also at the Minister, who through legislation such as the Bill is making it increasingly difficult for the Western Isles education authority, and for all education authorities in Scotland, to fulfil statutory functions.

School transport provision, another statutory function, is also in danger. During the previous Parliament, there was a move by the Government completely to remove the duty on local education authorities to provide free school transport. Fortunately, the proposal was thrown out by those in another place. That goes to show that the Government are more reactionary even than the House of Lords. Many of those in another place come from rural areas and they were aware of the difficulties facing children in rural areas in getting to school unless the statutory provision was retained.

The statutory duty to provide school transport has been kept, but I suspect that many local authorities, if the Bill is enacted and other expenditure cuts are pushed through by the Government, will find it increasingly difficult to meet the cost of providing free school transport. I am sorry that the hon. Member for Stirling (Mr. Forsyth) is not seeking to intervene. I believe that he was involved recently in pressing the Central regional council to increase expenditure on this transport. That is partly because the rural school in which he was interested was attended by his own children. It is interesting to note that even the most confirmed monetarist will at times call for more public expenditure in his own interests or those of his family.

That story emanated from one of the Labour councillors on the Central regional council. Like so much of what is said about cuts and other matters in Central region, it was totally without foundation. As the hon. Gentleman should know, my children attend a private school and do not go to the school that he alleges. The hon. Gentleman missed the point completely.

With regard to the lack of transport, I wonder what the hon. Gentleman thinks about Central regional council's policy on rural transport, which I support, of encouraging parents to band together and organise their own transport.

I chose my words carefully. If the hon. Gentleman reads Hansard, he will see that I referred to the school that was "attended"—I used the past tense—by his children. I understood that the hon. Gentleman had moved his children to a private, fee-paying school because of the inadequate school transport provisions. The fact remains that he made representations to Central regional council to improve the school transport provisions for children attending the rural school. That goes to show that even lovers of the Adam Smith institute and the economic doctrines that he espouses sometimes have to call for more public expenditure, if not for their families then for constituents who happen to live in rural areas and whose children need to get to school.

I support the hon. Gentleman in his representations and I am sorry that his children have the disadvantage of going to one of the worst schools in Central region. It is one of the few fee-paying schools left there. Its educational standards are abysmal compared with the very good standards of the local education authority's school where his children used to go. I am only sorry that the hon. Gentleman did not seek my advice on that matter earlier.

I turn to another statutory function—social work—that is undertaken by Central regional council, indeed by all regional councils in Scotland and by the islands councils. Many social work authorities find it increasingly difficult to fulfil their duties under existing statutes. I know that many local councillors have been so constrained by Government policy and the financial straitjacket in which they find themselves that they have reluctantly had to reduce certain services.

For example, the number of home helps has been reduced in many areas and wardens for old folks' sheltered housing are being phased out. I remember that my right hon. Friend the Member for Manchester, Wythenshawe (Mr. Morris) piloted the Chronically Sick and Disabled Persons Bill through the House when he was shadow Minister for the disabled. Under that legislation, local authorities have a duty to compile a fairly detailed register of all those who require assistance and those who, for example, suffer from disabilities and may require special services under that or other legislation. To this day, many authorities have not been able to find the time or, more importantly, the resources to compile such a comprehensive register, so technically they are failing in their statutory duties because of the failure of central Government to provide adequate resources.

Many extra duties have been put on the backs of local authorities over the years. The Goverment have imposed extra duties on them in relation to civil defence. To my mind, that is a complete waste of public money. Instead of handing out peanuts in support of so-called civil defence, the surest form of self-defence, saving billions of pounds, would be to cancel Trident and tell Reagan to take his cruise missiles home. The country would then be a much safer place to live in, without all the extra impositions on local authorities for civil defence. Most of the expenditure is supposed to be met by central Government, but some must be met by local authorities and they will find it increasingly difficult to do so.

Clause 4 also puts an extra statutory duty on local authorities to consult non-domestic ratepayers. That might involve considerable extra expense, especially in rural areas. Members and officers of Strathclyde regional health authority, for example, may have to go to Oban and south Ayrshire to meet the local chambers of commerce as well as to the Isle of Mull to meet interested non-domestic ratepayers there. That statutory duty may involve thousands, perhaps even hundreds of thousands, of pounds in travel expenses alone, quite apart from subsistence costs if councillors and officials have to overnight in Tobermory because they cannot get back to their beds in Glasgow. The Secretary of State has not thought this through. If a local authority feels that it needs to raise extra revenue but the Secretary of State says that it must not increase the rates, the authority will find it difficult if not impossible to fulfil all those statutory duties.

Quite apart from examples of trivial or secondary importance such as civil defence and consultation with non-domestic ratepayers, the essence of local government is in the quality of service that it provides for human beings. A great deal of the discussion on the Bill, however, has been about finance and economics and the general thinking behind it stems from the Government's macroeconomic theory of doctrinaire monetarism or whatever one cares to call it. As I said at the outset, we should be considering the consequences of this measure in terms of the essential services required to improve the quality of life of the people whom councillors are elected to represent. I refer to the right of children and indeed people of all ages to a decent standard of education. There are the social service needs of the elderly, the sick and the disabled — some of the most deserving members of society.

Ministers have constantly talked about the need to control expenditure, but what about the quality of life of the human beings involved? We should put people first. If we do that, I believe that there will be support for my amendment.

I intervene briefly, if only to point out that the amendment appears to be defective in that we are asked to take into account the fact that an authority might not be able to fulfil its statutory obligations. How on earth can one assess that? Stirling has always claimed that services will suffer as a result of selective action, but whenever such action has been taken and the ratepayers have benefited from a rebate there have been no cuts in services. On the contrary, the services about which the hon. Member for Falkirk, West (Mr. Canavan) claims to be concerned have actually been improved. He dealt with the range of services at some length, but in housing, for example, considerable savings have beeen made in management and maintenance and the service has been improved by bringing in computers, and so on. In every area of activity economies have been found. When the money supply is turned off it concentrates the mind of the council concerned and the standard of services is improved.

Although the Stirling authority has been subject to selective action, it is staging a jamboree on 16 April, in the middle of the election campaign, at a cost of £35,000 to ratepayers. Invitations have been sent to people all over Scotland on pieces of parchment sent in cardboard tubes at vast expense. Yet Opposition Members tell us to sympathise with such local authorities. There is no danger to education, social services, housing, or any of the areas which worry Tory Members, by exercising financial restraint. Ideological activities, which many authorities have embarked on, will be the only casualties.

9.15 pm

We are led to believe that action against local authorities must mean action against the most vulnerable in society. Authorities such as the Stirling authority still find money to fund the Campaign for Nuclear Disarmament, advertise in Labour party publications, provide support and resources for towns in Nicaragua, and be involved in many activities which have nothing to do with their statutory duties.

The amendment is, once again, an attempt to divert attention from the real issue which dominates the Bill, which is to get value for money for ratepayers and better services by finding better means of provision.

I support the amendment, and shall use it to highlight the problems experienced by some sections of the community.

My hon. Friend the Member for Falkirk, West (Mr. Canavan) mentioned the statutory rights of local authorities. They have a statutory obligation to raise rates both from football grounds and race courses. No doubt the Minister has received a great deal of correspondence from race course owners and football associations.

Race courses in England pay a quarter in rates of what their counterparts in Scotland pay. [Interruption.] The Minister should not interrupt me. He is not the custodian of the rules of the House, but is here to listen to hon. Members. It is not his place to tell hon. Members whether they are speaking to the correct amendment. I wanted to put a matter on the record and would be happy to have the Minister's comment about it. The more he interrupts me the longer I shall take to make my point. I hoped to make a brief intervention, but he is making the usual mess of proceedings.

I am worried that the Ayr race course pays five times more in rates than the Newbury race course, and that Scottish football grounds pay three times more than English ones.

The Government have caused a great deal of unemployment in Scotland. It is deplorable. In some parts of my constituency, unemployment is as high as 50 per cent. because of the failure of the Government Front Bench, who have the cheek to call themselves Ministers. The only break for many of my constituents is to go to a football match and enjoy themselves. The pressures that the Government are putting on football associations make it increasingly difficult for football clubs to maintain their premises. Conservative Members often tell us that business men have been hit by high rates. Why does the Minister therefore not do something about the problems of the rating system for football clubs in Scotland which have been brought to his notice? If he spoke up for football associations, unemployed people would be able to watch the national sport more cheaply. I am glad that I have woken the Minister up as he was looking a little cheesed off earlier. For the sake of the sporting fraternity in Scotland, I hope that he will do something.

I listened with great care and attention to the hon. Member for Glasgow, Springburn (Mr. Martin). I suspect that he decided to speak now because he wants to go and have a meal or something. If he wants an answer, I hope that he will wait until we consider the clause that concerns the rating of football grounds. It would be wrong for me to comment on such rating on amendment No. 17.

Amendment No. 17 suggests to me a misunderstanding of the working of clause 3 and of the way in which my right hon. Friend intends to apply it. In arriving at the rate support grant settlement each year, the Secretary of State is bound by section 2 of the Local Government (Scotland) Act 1966 to take into consideration, among other things,
"any probable fluctuation in the demand for services giving rise to reckonable expenditure so far as the fluctuation is attributable to circumstances prevailing in Scotland as a whole which are not under the control of local authorities".
I am sure that the hon. Member for Falkirk, West (Mr. Canavan) appreciates that those words mean the statutory duties to which he referred. Therefore, the Secretary of State must have regard to those factors at an early stage when rate support grant is being calculated. What might follow—I say "might" as clause 3 is an enabling and not a mandatory clause—will depend to a large extent on the Secretary of State's overall view of local authority expenditure. Part of that will be the same assessment as he made when arriving at the rate support grant.

The factors that the hon. Member for Falkirk, West is worried about will have been in my right hon. Friend's mind before he considers whether the powers given by clause 3 should be used. I took great pains in Committee to point out that we are discussing a reserve power which will be used only if local authorities fail to bring their expenditure into line with the Government's plans and impose unreasonable rate increases. No Government, let alone the present one, will set a rate limit that makes it impossible for local authorities to carry out their statutory functions. Such action would be in nobody's interests, and it cannot realistically be suggested by the hon. Gentleman.

There might be exceptional factors outside their control which could cause some authorities difficulties. Clause 2 makes provision to meet that. The new section, 108C, which clause 3 introduces enables the Secretary of State to direct that the general rate limit shall not apply to any given authority. It will be open to any authority that is faced, for example, with unusual expenditure or a sudden drop in rate resources to apply for such a derogation which would receive careful consideration.

I hope that I have reassured the House that the general considerations will have been taken account of in arriving at the rate support grant settlement and that if there are individual cases in which authorities, for exceptional reasons, find themselves in difficulties, and particularly if they affect their statutory responsibilities, there is a power within this Bill for them to apply to the Secretary of State for a derogation.

I therefore think that the provision and the security which the hon. Member is seeking are already in the clause and I hope that on that basis he will withdraw the amendment.

I make the point, in supporting the amendment, that despite the assurance just given by the Minster from the Dispatch Box, he received pressure from various Highland Members—me, my hon. Friends the Members for Inverness, Nairn and Lochaber (Mr. Johnston) and Caithness and Sutherland (Mr. Maclennan)—at the new year about roads provision in the area of the Highland regional council. He must be aware that already that regional authority is unable to provide adequately for its statutory obligation in terms of roads provision.

The reality of this is brought home particularly by the fact that, as was pointed out to us at a meeting which the three of us attended with the Highland regional council, 10 years ago the local authority before local government reorganisation spent in real terms half what the entire Highland regional council now spends on its roadways. Under the former local authority, the part they were talking about was for 400 miles of roadway in the island of Skye. Now, 10 years later, the Highland region has control of 4,000 miles of roadway throughout the Highland regional area. In real terms the expenditure is only double for 10 times as much roadway. That brings home very clearly that the amount of cash available to them, or certainly the amount of money that they feel able to spend, is quite insufficient.

Therefore, as roads are such a crucial statutory function in the Highlands, I think that the amendment proposed by the hon. Member for Falkirk, West (Mr. Canavan) is important and should be supported. The assurance that we have had from the Minister is inadequate. I hope, therefore, that the House will give its full support to the amendment, which would certainly be warmly received in my constituency and those of my hon. Friends in the Highland region.

This has been an interesting debate, Mr. Speaker, and I am sure you have observed that the law-abiding Members on this side of the House have been attempting to advance a rather obvious case for keeping the law in local government as well as in Parliament. It was appropriate that my hon. Friend the Member for Falkirk, West (Mr. Canavan), a highly responsible and respected Member of the House, as you know, Mr. Speaker, should have been arguing for the right of local authorities to act in accordance with the statutes imposed upon them by this House.

My hon. Friend was joined by my hon. Friend the Member for Glasgow, Springburn (Mr. Martin), who ought not to be too perplexed because the Minister apparently did not understand his argument. I spent the entire time in the Committee getting a similar response from the Minister, because, although on those occasions he actually listened to the speeches, I found that he responded in the same perplexed way when I spoke.

I did not, until tonight, understand the reason, but now I should like to assert publicly what I understand that reason to be. Clearly, my hon. Friend the Member for Springburn pitched his argument on far too high an intellectual level for the Minister to comprehend. I now understand the difficulties which I encountered.

My hon. Friends and the hon. Member for Ross, Cromarty and — I should not forget — Skye (Mr. Kennedy), as that is an important part of the Highlands, referred to particular functions of local authorities. All of them are important. There was an exchange between hon. Members on the subject of education. When the Bill is enacted I shall be worried, because the hon. Member for Strathkelvin and Bearsden (Mr. Hirst)——

It being half-past Nine o'clock, MR. SPEAKER proceeded, pursuant to the Order [5 March] and the resolution this day, to put forthwith the Question already proposed from the Chair.

Amendment negatived.

I am now required to put the Questions on any amendments up to the end of clause 8 moved by a member of the Government. I refer to amendments Nos. 3 to 7 inclusive. Does any hon. Member wish to divide against any of those amendments?