House of Commons
Thursday 1 December 2005
The House met at half-past Ten o'clock
Prayers
Mr Speaker in the Chair
Oral Answers to Questions
Trade and Industry
The Secretary of State was asked—
Microgeneration
The Government already encourage microgeneration in a variety of ways. For example, there is a 5 per cent. VAT level on most microgeneration technologies. We have provided £41 million of support for solar photovoltaic projects through the major PV demonstration programme and support for field trials. There is £12.5 million of support for household and community renewable energy schemes through the clear skies initiative; and £30 million of funding for a new low carbon buildings programme. We have also amended the renewables obligation to make it easier for microgenerators to claim renewables obligations certificates.
My Department is leading the development of a cross-Government strategy for the promotion of microgeneration. This strategy will be published by next April, in accordance with our commitment under the Energy Act 2004.
In relation to clear skies, I expect that all funding will be allocated by the time the programme ends in March 2006, but projects will have a further 12 months to be completed and actually to spend the money.
Despite the warm words of the Secretary of State, it is still clear that the take-up of microgeneration is minimal and that the market for it is still very underdeveloped. Will the right hon. Gentleman consider, in assessing the upcoming energy review, how, if the Government decide to go down the nuclear route, they will ensure that the nuclear industry does not effectively crowd out microgeneration and make it more difficult for investment in it? In particular, if the right hon. Gentleman decides to go—
Order. Perhaps this is a matter for an Adjournment Debate. That would seem to be appropriate.
I agree with the hon. Lady's assessment that microgeneration is underdeveloped. Some of the reasons for that will be dealt with in our strategy, which we will publish next April. Much of it is about public awareness, some of it is about problems with planning and some of it is about connection with the grid.
As for the hon. Lady's question about nuclear energy, if the energy review went down that path, I do not think that it would have any impact on the need to develop this particular area of microgeneration. Microgeneration is important in its own right, whatever we do in the rest of the energy mix.
This being the season of good will and festive cheer, as well as reviews, will my right hon. Friend review the amount of money put into the low carbon building initiative, which year on year is quite a bit less than what was put into the programmes that it replaces? If my right hon. Friend is looking for somewhere to get the money, may I suggest that he dips into his Department's nuclear fusion research money, which is considerably more than that being given to the low carbon buildings initiative?
I suppose that as it is 1 December we can officially say that it is the season of good will, but it is not the season of distorting our figures—[Interruption]—as every other season of the year. My hon. Friend is wrong about this. I understand how passionately he feels about the matter, particularly photovoltaics. On average, under the low carbon buildings programme we shall be spending £9.5 million a year compared with £9.2 million average yearly spend since 2000 under the previous project. We have not diluted the amount of money that we are making available, although the use of grants is not the total picture in terms of how we can encourage greater use of microgeneration.
From the Secretary of State's earlier responses it is obvious that he has recognised the true potential of micro-combined heat and power generation. Has he seen the recent report of the Society of British Gas Industries, which clearly shows that micro-CHP could, by 2015, generate enough power to reduce carbon dioxide emissions by 1.1 million tonnes per annum? Will the right hon. Gentleman take urgent action to ensure that the right regulatory framework is in place to enable that to happen?
I have seen that report, which is an important contribution to our strategy review. That strategy review, to which we made a commitment in the Energy Act 2004, was designed specifically to address these issues. I mentioned planning as a problem earlier. The report is an important contribution to the debate, and it is an area of legitimate concern on both sides of the House. We will try to ensure that planning regulations do not inhibit the growth of combined heat and power.
I congratulate my right hon. Friend on his Department's strong support for two private Members' Bills seeking to enhance the use of microgeneration to an enormous extent, one of which was unfortunately blocked by a maverick climate change denier on the Opposition Benches. If that block continues, is it my right hon. Friend's intention to find Government time to complete those Bills and place them on the statute book?
I reaffirm our support for the private Member's Bill tabled by my hon. Friend the Member for Edinburgh, North and Leith (Mark Lazarowicz). As for how we could get around any blockage, that is a subject for others, such as the usual channels.
I see that my hon. Friend the Member for Edinburgh, North and Leith is present. His Bill contains important principles, and I am sure that it will be supported by Members in all parts of the House. I hope that the person responsible for blocking its passage will remove the blockage; if he does not, we shall have to consider other ways of dealing with it.
The hon. Member for Southampton, Test (Dr. Whitehead) asked a pertinent question. It is in the Government's power to continue to pursue that Bill. Let us see whether they do so, or whether what we are hearing is just rhetoric. I do not support the action of my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) in blocking the Bill.
I agree with my hon. Friend the Member for Chipping Barnet (Mrs. Villiers). We have had stop-go policies for the clear skies programme, and the Office of the Deputy Prime Minister has been very obstructive in regard to constructive building regulations for microgeneration and micro-CHP, although we know that those processes have enormous potential for reducing carbon dioxide emissions. Why are the Government being so half-hearted about those programmes and that potential? Does their attitude not underline the fact that their entire energy policy is in a mess—which, of course, is why the Secretary of State has to have a review?
That is nonsense on stilts. On clear skies, we have a go-go policy. There is no gap. There used to be a gap of about four months between money going out and the receiving of, and responses to, bids. In this case there will be a five-month interval—so if there can be said to be a gap, it is a gap of only a month—between the end of the clear skies programme and the start of the new programme.
The hon. Gentleman should give some advice to his right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth). We shall be able to proceed with that private Member's Bill if it is not blocked by Conservative Members. I was pleased to hear what the hon. Gentleman said. Why should we delay and lose time? Why should the Government have to rethink the whole programme and go through the usual channels when a quiet word in the right hon. Gentleman's ear might allow us to proceed?
WTO Meeting
Her Majesty's Government remain committed to achieving an ambitious, pro-development outcome at the Hong Kong ministerial conference, which will allow conclusion of the Doha development agenda by the end of 2006. The draft text for the Hong Kong meeting was issued on 26 November by Pascal Lamy, the director general of the World Trade Organisation. He will consult Members further before the General Council meeting on 1 and 2 December. After that meeting, the text will be submitted for discussion by Ministers in Hong Kong.
Despite the best efforts of Commissioner Mandelson, the European Union seems to have forgotten that this was meant to be a development round. Will our Government continue to press for overall cuts in European agriculture subsidies under the common agricultural policy?
Is my right hon. Friend aware of the World Bank's estimate that if only 2 per cent. of tariff lines were protected as especially sensitive products, Europeans would be able to protect virtually every product that poor countries want to export to us? Yet under the EU's predatory policy, 8 per cent. fall into that category. Will the Secretary of State ask the EU to reconsider?
My hon. Friend has raised an important point. It is difficult not to be pessimistic about our chances of making the progress that we would like to make in Hong Kong. We should have been in a far better position.
As my hon. Friend knows, there are now 149 countries in the WTO since the recent accession of Saudi Arabia. Each country has a vote and a veto. Our role as President of the European Union is to ensure that the European Union has a coherent voice that Commissioner Mandelson can use during the negotiations. It is a difficult task, but we know where we are in the United Kingdom. I believe that there is all-party support for making this truly a development round.
My hon. Friend made a crucial point about the percentage of sensitive products. Virtually any tariff can be imposed on such products, because they are sensitive to the countries involved. It is not just the World Bank but the United Kingdom, in our trade and development White Paper last year, that said that those should be limited to 2 per cent. The American offer is 1 per cent. and the European Union offer is 7 per cent.—but, to be fair to the Commissioner, I must add that one member state was vociferously arguing for 15 per cent. Those are problems, but we have to come through them. It is no good our lecturing other member states; we have to persuade them to go down that route, so that we can achieve a proper outcome to the Doha development round.
The Secretary of State has just highlighted the downplaying of expectations for Hong Kong, yet he will recall that the commitment at the G8 was for Hong Kong to be a success, not some later ministerial meeting next year, and for Hong Kong to set a date for ending subsidies and dumping. Having just returned from a Christian Aid funded visit to Ghana, I can say that the Government there are desperate to ensure that we end the scandal of dumping subsidised agricultural goods, which destroys their local markets. What precisely are the Government doing to achieve a decisive breakthrough in Europe, and to make the European process more transparent?
I am not accusing the hon. Gentleman of making political points, but let us put all the politicising to one side now. We have tried very hard, with all-party support, to use our presidency of the G8 and the EU to create some momentum leading up to Hong Kong. I cannot think of any initiative that we could have taken that we have not taken to try to get to that position. The G7 Finance Ministers are meeting this weekend, and at the instigation of the UK, Brazil and India will be there, so that the Finance Ministers can try to reach some solution. We were also at the Commonwealth conference last week. No stone has been left unturned as we try to get somewhere.
As for where we are now, and the important point that the hon. Gentleman raised about how we can make more progress, we have been instrumental in the production by the Commission of a development package. By and large, the G90 countries—the poorer countries—have not heard anything about their problems yet, because the negotiations have been stuck in an agricultural silo. The idea of a development package is to pick out an issue, such as cotton, or the least developed countries' right to export to all developed countries' markets free of tariffs, which already applies to the EU, but not to the United States and other developed countries. It is also to examine the issue of aid for trade, which is a subset of the WTO discussions, so that there is at least a discussion of the developing countries' agenda, rather than the continual and rather depressing concentration purely on agricultural issues.
In that context, does my right hon. Friend agree that we also need to think about the NAMA—non-agricultural market access—side of the negotiations, and that we need to allow sufficient flexibility in any solution to those negotiations to allow the least developed countries to develop their own industrial bases?
I agree with my hon. Friend. The Commission says that if it is to have any chance of bringing the EU to a different position, not fixated on agriculture, it needs countries such as Brazil and India to start to move on industry. This is about agriculture, industry and services, but so far we have concentrated on agriculture alone. There is now a need for countries to start turning over cards—with conditional offers; they do not have to say that that is their final position—just to show European Union countries that there are huge advantages to be had. Everyone will gain from a successful conclusion; this is win, win. On industry and services there are huge gains to be made, not between developing and developed countries but among developed countries, if we open markets. My hon. Friend has raised an important point, which is crucial to the successful outcome of the round.
Only last week we heard about another food crisis in Africa, this time in the republic of Niger. I support emergency aid and debt relief, but we have to move things on with reforms of tariff barriers and export subsidies. Will the Secretary of State ask his friends in the EU this: as the common agricultural policy has driven our farmers to near bankruptcy, made the British housewife pay more for food than she needs to and is damaging the third world, exactly who is it helping?
It would not be all that fruitful if I asked that question. The argument used in the EU is that common agricultural policy reform, in so far as it has already happened—it was a dramatic reform compared with the previous position—should be a bargaining chip at Doha. The rest of the world tends to say, "You would have done that anyway, so how can you argue for the virtue of such reform? You need to go further." I have to say that the vast majority of EU member states believe that we have gone far enough, and that it is now time for the industry to make a move; I am merely reflecting the views that we pick up on in our EU presidency role. One day there will have to be reform. My right hon. Friend the Secretary of State for Environment, Food and Rural Affairs achieved the breakthrough—at last—of a 36 per cent. cut in sugar subsidies, which have not been reformed for 40 years. So some movement has been secured there, at least, which will help us in Hong Kong.
Will my right hon. Friend consider getting on to the WTO agenda a worldwide asbestos ban? He may be aware that two or three years ago, the United Nations interim chemical review committee, which is part of the environmental programme, recommended that all asbestos be restricted because of dangers to health. However, we seem not to have made progress on this issue, and the way to do so is to get it on to the WTO agenda.
I certainly will give consideration to the important issue that my hon. Friend has raised. There is an environmental dimension to this trade round—we have got nowhere near talking about it yet—just as there is a trade facilitation aspect. Because we have got bogged down in considering a particular pillar of agriculture, we have not got on to these important issues, but I will turn my mind to how we can ensure that progress has been made on asbestos by the end of this round.
Does the Secretary of State accept that the European Union's agricultural tariffs are economic nonsense and morally indefensible? Is that not the starting-point that we should adopt as we go into the next round of the trade negotiations? I was very disappointed to discover that he is so pessimistic about the outcome. Why do we not enter into the negotiations in two weeks' time committed to removing the EU's agricultural tariffs? That is the single most positive thing that we could do to help the third world. Surely our presidency of the EU should not be about neutrality and chairmanship, but leadership.
On the first question, I agree entirely with the hon. Gentleman; indeed, my predecessor made that point in last year's White Paper on trade and development. We pointed out the hypocrisy of developed countries lecturing developing countries on removing their trade barriers, when we still hide behind protectionism, so we are sending out a very strong message. Developed countries have to dismantle protectionist policies and set a date—we think that it should be 2010—for the parallel elimination of all forms of export subsidy in agriculture.
On the question of negotiating a settlement, the gung-ho part of the hon. Gentleman's Havant constituency seems to have come to the fore; usually, he takes a thoughtful and reflective approach to these issues. Conservative Members will know, because their party held the EU presidency when in government, that the worst mistake that countries can make when holding the presidency is to push their own position from the presidential chair. If they do, nobody will follow them. Instead, they have to try to persuade other member states to their point of view. Lecturing the rest of Europe from the presidential chair and repeatedly telling them about the UK's position would be a disaster.
On the question of my being pessimistic, we will move mountains, as the Prime Minister said in his recent Guildhall speech. However, as I said in my first answer, the text has just been released—it should have been released last July—and it would be misleading, going into the Hong Kong meeting, to say that we are wildly optimistic. Of course, that does not mean that we should not complete this round successfully by the end of 2006. What it does mean is that we have to make a sober appraisal of where we are, and plan to ensure that this round is brought to a successful conclusion.
May I press the Secretary of State on this matter? Since enlargement, a blocking minority of free-trade countries has existed in the EU. That is how the world has changed. I do not know why the EU still does things like imposing tariffs on Chinese textiles, when it should be organising the free traders. The Trade Commissioner will play a crucial role, so will the right hon. Gentleman have a word in his ear? Has the Secretary of State learned to love the commissioner yet? Will he tell him that Opposition Members could find a tiny place in our hearts for him if he went to Hong Kong committed to free trade?
There is love abounding in my heart for the Trade Commissioner, and there always has been. When it comes to his role, he must not be seen as a UK Commissioner. That is part of the problem: people who are a little paranoid about these matters see that the UK position is one of liberalisation, that the UK holds the presidency and that a UK national is Trade Commissioner. We—and the commissioner more than anyone else—must ensure that everyone has faith in our ability to operate within the EU mandate. We are committed to changing that mandate in respect of the CAP over the coming months and years. I think that it is inevitable that that regime will change, and that we have enough support to achieve that gradually. We do not have enough support to achieve it in time for Hong Kong, but I believe that we can bring the matter to a successful conclusion by the end of 2006.
Unscrupulous Lenders
The Consumer Credit Bill, which is currently before the other place, will improve the regulation and monitoring of consumer credit businesses and extend protections, rights and means of redress for consumers against unscrupulous lenders. Furthermore, the Government are funding two pilot schemes aimed at tackling loan sharks in Birmingham and Glasgow. That will enable trading standards officers to prosecute illegal lenders in those areas and gain a clearer understanding of the scope, extent and impact of illegal money lending.
I thank my hon. Friend for that answer. Will he join me in welcoming the results of the pilot scheme in Glasgow, where prosecutions have been brought? However, he will be aware that the approach of Christmas makes the pressure on families even stronger than normal. Does he agree that credit unions can help people in need? Will he do something to lessen the amount of red tape that credit unions have to deal with?
First, may I acknowledge my hon. Friend's thanks to the loan shark pilot team in Glasgow? It is working very well, and has managed to get individuals put behind bars for the way that they treat vulnerable people. Credit unions are very important, and I am talking to Treasury colleagues about ways to reduce the administrative burdens that they face. Their work, and the new Consumer Credit Bill, will alleviate the problem and usher in a period of responsible lending and borrowing, with people at the bottom end of the scale, who have the most problems, getting the support that they need.
Given that unscrupulous lenders are spread across the UK, will the Minister speak to his ministerial colleagues in the Northern Ireland Office to ensure that those rogues are dealt with effectively in Northern Ireland as well?
It is important that we look at what is happening all over the UK, including Northern Ireland. We are acquiring much evidence and gaining new skills about how to tackle the loan shark problem. Loan sharks prey in the most horrible way on vulnerable people. We have made sure that people are able to get advice and support. Through the Office of Fair Trading licensing scheme, we are ensuring that people who lend money are reputable.
The Minister knows that financial inclusion is one way for people to get out of the hands of unscrupulous lenders, and that the Treasury Select Committee has set up an inquiry into financial exclusion to which he will be invited in the new year. However, there is poor co-ordination between Government Departments on this matter. For instance, research information about postcodes for financial inclusion is available to the Treasury and the DTI, but not to the Select Committee. Will he work with his colleagues in the Treasury to ensure that we get that information before the inquiry begins, so that a map can be made of the areas of financial exclusion? That will enable us to tackle the problem in a more co-ordinated way.
I acknowledge the work done on this issue over a number of years by the Select Committee, of which my right hon. Friend is Chairman. I shall be happy to appear before his Committee again, as I was the last time that I did so, but I shall make sure that the information that he requires will be made available before then.
Even at this late stage, will the Minister reconsider his refusal to include more detail in the Consumer Credit Bill about what would constitute an unfair relationship? Is he not aware that both lenders and consumer groups are calling for greater clarity? Their concern is that as the Bill stands, it will harm the interests of borrowers. Without greater detail, lenders will become more cautious in their lending, driving those on the fringe to borrow from unscrupulous lenders or loan sharks at excessive rates of interest. Is not it wholly unreasonable to expect such issues to be resolved through the courts, requiring some unfortunate borrower to take on the legal might of the financial institutions to establish what is fair and what is not?
This is an issue that the hon. Gentleman and I have discussed throughout the stages of the Consumer Credit Bill, and I am not minded to change my mind on the unfairness test. That test replaces the extortionate credit test, which did not work for consumers. The unfairness test will give the courts the opportunity to decide all relevant factors. We also have the alternative dispute resolution procedure before the court-based system. Transparency is at the heart of the Bill to ensure that lenders and consumers know what they are letting themselves in for.
The pilot projects on loan sharks in Glasgow and Birmingham, to which my hon. Friend referred, have indeed proved successful. Glasgow city council, which is involved in the scheme with the Department, has written to me—and, no doubt, to other MPs in Scotland—pointing out that it has uncovered evidence of loan shark activity in my constituency, linked to that in Glasgow. Like the hon. Member for South Antrim (Dr. McCrea), I urge my hon. Friend to ensure that the pilot schemes on loan sharks are rolled out throughout the country as soon as possible.
My hon. Friend has a good record of support for people on low incomes and encouraging financial inclusion. We will look at the outcomes of the pilots, which are already good. The Glasgow project is looking at the rest of Scotland, but we will try to roll out to the rest of the UK the experience and skills developed in those pilot schemes.
Trade with India
We are working to increase trade through the Joint Economic Trade Committee and the Asia taskforce. UK Trade and Investment provides direct support to companies and we also support the Indo-British Partnership Network.
I wish to draw the House's attention to my entry in the Register of Members' Interests. The initiatives that the Minister outlines are important and to be welcomed, but is he aware of the real frustration and concern among many UK exporters that we are not capturing our appropriate share of the growth in India's international trade, given our shared history, linguistic ties and other potential competitive advantages? Does he agree with the director general of the British Chambers of Commerce, who said recently that there is too much focus on Europe as a trading bloc and that we must get out to where the action is?
I have no doubt that we can do more, but let us not forget the progress that has been made so far. In the first six months of this year, trade with India rose by 24 per cent. compared with the previous year. We had 49 trade missions in 2004, we have more this year and we will have still more in 2006. We are getting on with it. India and China are hugely important growth markets for the future—we should not be in any doubt about that—and I want UK companies to trade not only with those countries, but within the EU, with the United States and further afield. Exporting is fundamentally important to the future economic prosperity of the UK and the Government will do all that we can to support that industry.
This is the first time in my life that I have seen a Government making so much effort to build relations between the UK and India. I praise the Government, from the Prime Minister down, for all the efforts that they have made.
Can my hon. Friend the Minister destroy the myth that has built up in the past few years that all the low-skilled jobs, in call centres and so on, are being shipped to India? Investment from India in this country is creating highly skilled jobs, and many highly professional, educated Indians are working—for example, in IT—and making a great contribution to this country.
I agree with my hon. Friend. Indian companies and Indian investment are very welcome in the United Kingdom. Companies like Tata Consultancy Services are doing a terrific job here. He will be interested to know that our balance of trade with India is roughly equal. In the first half of this year, our exports to India were worth about £1.84 billion and our imports were worth £1.85 billion. That shows what we have done. He is also right to point to our continuing strong links with India. The Prime Minister's visit to India and the UK/India summit, as well as the EU/India summit, were important developments. We are working very hard through JETCO and the Asia taskforce to strengthen our relations, and we will continue to do so in the future.
Does the Minister share my concern that the public debate on our trade and investment relations with India is too often characterised by threats, rather than opportunity? In that context, does he welcome the decision of the Select Committee on Trade and Industry to launch a major inquiry into our trade and investment relations with India, which I expect to identify policy initiatives that the British and Indian Governments could take to build a sustainable long-term improvement in our trading relations, for the benefit of both countries?
I can only agree with the hon. Gentleman. I very much welcome the Select Committee inquiry. India and China have the ability to transform our world. That is highly likely to happen over the next 10 to 20 years. We must see the growth of India and China as an opportunity, not as a threat, and take advantage of the trading opportunities that will accrue as a result of their rapid economic expansion. As a Government, we are very seized of that, and we are developing our policies and ensuring that we put our resources behind encouraging and supporting our companies to take advantage of those opportunities.
The Minister will be aware that caste discrimination is a huge problem in India and that 160 million people in India suffer its consequences. Is he prepared to undertake discussions with any British company that operates or invests in India to adopt the Ambedkar principles, by which the people who are known as the scheduled castes in India would receive fair treatment, thus making our contribution to ending that appalling discrimination against so many people?
My hon. Friend raises an important point. We discuss those issues with the Indian Government, and we are very clear indeed about encouraging the corporate social responsibility of companies that invest in India. So I can assure him that the points that he makes are valid and taken into account in our discussions with industry and the Indian Government.
Our trade with India is extremely important, but does the Minister agree that it must be conducted on a fair basis? Mr. Alistair Buchan, who is chairman of the Scottish Tartans Authority and Lochcarron of Scotland, based in my constituency, has highlighted websites, such as mytartan.com, which are passing off kilts and other products made in India as though they were made in Scotland. Will the hon. Gentleman look again at the regulations affecting websites and labelling to ensure that trading standards officials have the right powers to stamp out those abuses?
I am certainly happy to look at the specific situation that the hon. Gentleman mentions. We also want to sell more Scotch whisky to India, and tariffs are unacceptably high. One of the things that we want the Doha development round to achieve is not just help for the poorest countries, although that is absolutely central to our Government's policy, but we want India to reduce some of its tariff barriers, as well as a further strengthening of two-way trade with India. But I will get back to the hon. Gentleman with some answers to the specific question that he asks.
Employment Agencies
The Department of Trade and Industry's employment agency standards inspectorate enforces the legislation regulating the activities of the private recruitment industry. Inspectors visit agencies' premises to examine their records. The inspectorate can prosecute an agency found to be in breach of the legislation, and the maximum fine is £5,000 for each offence. The inspectorate can also apply to an employment tribunal for an order prohibiting an individual from operating an agency or employment business for up to 10 years.
I thank my hon. Friend for that answer. Is he aware of an organisation called Placement UK HR Ltd., which, in a booklet entitled "Half price staff: Shhhh! It's the best kept secret . . . ", proudly boasts that it can supply "graduate calibre staff" for
"Just £7000 per Annum—All in . . . No National Minimum Wage . . . No PAYE . . . No Employers N.I. Contributions . . . No Holiday Pay . . . No Sick Pay . . . No Contract of Employment . . . No problem"?
Will he look into this as a matter of urgency, because the outfit is clearly intent on trying to make a mockery of every piece of employment legislation that we have ever passed in this place?
I am grateful to my hon. Friend for raising the issue. Obviously, we will look into the company, which is operating illegally by not paying the national minimum wage and in the other ways that he raises. There is a change of demography in the workplace, so it is important that we monitor what happens with such agencies. There is, quite rightly, an influx of legal migrant workers into the UK through agencies, so I am keen to hear of any instances of people being exploited. I am sure that hon. Members on both sides of the House want to ensure that no one is exploited by any agency that does not operate properly.
Is the Minister aware that there is a grey area of the law that applies to people based in this country who are recruited by employment agencies—particularly those based in Holland—to work on German construction sites, especially? They are not employed on the same terms and conditions as those working in Holland and Germany. Is the Minister prepared to examine the matter?
I am happy to enter into correspondence with the hon. Lady about the case, or to see her. There is a change in demography and the way in which work operates throughout Europe, but we need to make sure that people are not exploited. I am happy to hear evidence from hon. Members about agencies that are not working properly.
The Minister referred to the exploitation that sometimes occurs when migrant workers are brought in by frankly corrupt and oppressive recruitment agencies in this country. One of the difficulties that we find when we try to regulate them is getting details from police forces in other European countries. Will he co-operate with the Home Office on pursuing the issue, to try to ensure that when the police in this country investigate such matters, they can get access to police records, especially Polish ones?
My hon. Friend raises an important point. There is a cross-departmental approach on workers coming from other member states. He will be aware that a great deal of work has been done with the Portuguese and Polish embassies to try to give information to workers who might come across from those countries about their rights, which should stop them being exploited. I am happy to work with all agencies to ensure that we continue to monitor the situation.
Rural Post Offices
The Government have committed up to £750 million, subject to state aid clearance, to 2008 to maintain the rural post office network.
I am grateful to the Minister for that answer. I am sure that he agrees that that funding represents only a fraction of the overall economic and social value of the post office network to our rural communities. I hope that he can assure the House that funding arrangements for 2008 onwards will be confirmed by the end of this financial year. Will he confirm that if they are not, the directors of Post Office Ltd. would be obliged to start the process that would lead to the closure of parts of the rural network?
As ever, the Liberal Democrats proceed with all the economic foresight of a myopic fruit bat on these matters. Only they could see 800 rural post offices that serve fewer than five people a day, at an average loss of £6.50 a customer visit, and respond by proposing to create 500 more, as they did at their party conference. As usual, they were defeated, of course, but only because they wanted to pay for that by privatising the Royal Mail.
In recognising the role of rural post offices, may I urge the Minister not to lose sight of the real value of urban sub-post offices, especially in areas of greatest social need?
My hon. Friend is absolutely right that the urban deprived network is a critical aspect of delivering the Government's agenda on social inclusion. It is essential that people continue to have access to that network, which has been guaranteed through the programme of urban reinvention that the Government initiated.
Recognising the importance of the post office network to rural and urban communities, will the Minister indicate the impact thus far of the switch to the way in which people receive their benefit and pension payments from post offices to banks?
I am glad that the hon. Gentleman has raised that important question, because 97 per cent. of benefit recipients now access their payments by direct payment into their bank account. It is often thought that the closures were precipitated by changes in the method of pension payments and the introduction of Post Office card accounts; in fact, they started long before the changes took place. Way back in 1999, a dramatic change had already started in the number of people who received their benefits by other means. Because of the new facilities available to them—internet banking and so on—our constituents have chosen different methods to access their own finances and the Government have responded to that. In 2000, about 70 per cent. of all benefits were paid by order book, but that proportion had already fallen to 57 per cent. by 2003, when the direct payment scheme was launched.
Businesslink
Since its formal launch in May 2004, nearly 13 million user sessions to the site have been logged and the number of visitors is increasing monthly. There were 600,000 site visits in October, with a minimum of 160,000 coming from repeat visitors. More than 200,000 of those users downloaded material such as business publications, grant application forms and legislative guidance. The site receives a continual flow of positive feedback from the small business community and its significance has been recognised by a prestigious plaudit—it was named by the UN world summit awards as the UK's best business website for best e-content application.
I commend the website for the advice it offers on pay-as-you-earn, value added tax, corporation tax, health and safety and the like, but as one who comes from a small business background I urge the Minister to ensure that organisations such as Revenue and Customs, local government environmental health departments and business advice centres do more to promote the site. What does he intend to do to make sure that small businesses throughout the country are aware of the site and encouraged to use it as a partner in their business development in years to come?
I am grateful to my hon. Friend, not only for his interest in the site but for his efforts to improve e-governance generally—a subject on which he has recently made valuable contributions in the House. Businesslink.gov is at the forefront of our e-government initiative and user numbers are hugely encouraging. We have made great strides in making business aware of the site's potential, but I welcome his comments on ensuring that it is more widely known throughout the country.
My hon. Friend talked about the way in which there should be link-up with Her Majesty's Revenue and Customs and an integrated approach. He will be interested to know that we are introducing an integrated service to enable customers to register for and access e-filing services provided by Inland Revenue, Customs and Excise and Companies House. That has required a major change in the way in which the departments provide those services. It is expected to lead the way in the development of further transactional services across government.
WTO NAMA Negotiations
The non-agricultural market access negotiations are an integral element of the Doha development agenda.
Does not the Minister agree that, at the request of countries such as the United States, Korea and China, one impact of the NAMA negotiations might be the curtailment as non-tariff barriers of measures such as energy saving labelling and safety testing on imported foods? Far from being a win-win situation, as the Secretary of State assured the hon. Member for Glasgow, North (Ann McKechin) it was, that might lead to the undermining of sustainability, consumer safety and consumer choice.
I assure the hon. Gentleman that nothing happening in the NAMA negotiations presents any real threat on those issues. Our aim in the negotiations is to achieve progress similar to the progress that we are now seeing in agriculture and to reduce tariffs—
There has been no progress.
The hon. Gentleman may say that, but the second European offer made by Commissioner Mandelson proposed an average tariff reduction on agricultural products of 39 per cent., which is more than was achieved in the Uruguay round. That is a serious offer. What we need now, as my right hon. Friend the Secretary of State said, is similar progress on NAMA and services, so that we can reduce tariff barriers and increase world trade in a way that will benefit both developing and developed countries
My hon. Friend is right to recognise that although there has been a great deal of focus on agricultural products, NAMA and services are important. Will he give us an assurance that in those discussions, the British Government will not force countries to privatise services that they do not want to privatise—that we will give a guarantee that they can decide about water and other public services in their country, and do what is in the best interests of their people?
My hon. Friend makes an important point, which has been raised by many non-governmental organisations. I can assure him that the UK's position is clear and has been stated by my right hon. Friend the Secretary of State on a number of occasions. There is nothing in the negotiations to force countries to privatise anything. What we want to see from the NAMA negotiations is a liberalisation of world trade, which would benefit developing and developed countries. That will be a priority in the negotiations.
Minister for Women
The Minister for Women and Equality was asked—
Gender Pay Gap
Action and policy interventions include Agenda for Change, which aims to bring fairer pay to over 1 million non-medical staff in the NHS, including women. The local government pay and work force strategy addresses the causes and effects of occupational segregation on the gender pay gap. I am also pleased to say that all Government departments and agencies have completed equal pay reviews.
The Equal Pay Act was introduced 30 years ago, yet we still have an 18 per cent. gender pay gap. I should have thought that the Government would take every opportunity to address that injustice, so can the Minister tell me why, in the forthcoming Equality Bill, public bodies will be required only to have a pay policy in place, without explicitly being required in the Bill to take action to close the pay gap?
The pay gap is an enormously important issue and it would be wrong to say that progress has not been made. Considerable progress has been made and the pay gap now is 17 per cent. on average, but down to 13 per cent. at the median. In the Equality Bill we are introducing a public sector duty to promote equality in various ways, including in pay. The work that will be done on pay will begin to make a difference, but it is only one aspect that we are considering. As I said, the local government pay and work force strategy addresses the causes and effects of occupational segregation, which we know is one of the main drivers of the gender pay gap.
Does my hon. Friend agree that the measures in the Equality Bill and the new commission for equality and human rights, with its main site to be based in Manchester, will help greatly in the work to close the pay gap for women in the public sector? Will she welcome the news that Salford council has just appointed a woman chief executive?
I certainly welcome the news that Salford council has just appointed a chief executive who is a woman. One of the key issues about the pay gap in the public sector is not that there are not many women working in the public sector—there are. The issue is the level of responsibility that they have and their position within the organisation. We are making progress on that, but we want to see much more progress made. The Equality Bill is one measure which will deal with that. We also have the Women and Work commission, which goes much wider than the public sector and will report next month on related issues. I hope that will take us a great deal further.
The Minister will be aware that one of the things the Government can do to ensure gender equality at the very top is to increase the number of women who occupy senior management posts in the civil service. The increase in the number of women in senior management posts over the past two years has been only 1.6 per cent., yet the Government have a target of increasing that number by 5 per cent. in the next three years. Can the Minister explain what measures she will use to achieve that target, and what the Prime Minister is doing to ensure that at Permanent Secretary level there is the representation of women that the country deserves?
I am glad that the hon. Gentleman shares my and my party's concern that we should have more women in top positions. We should celebrate the existence of tough targets rather than fearing them. Implementing a range of measures to reach those targets is enormously important, and we expect all Departments to consider the issue. Fast-stream measures have been implemented to help talented people of both genders to move through the system. I am sure that improvements will be made very quickly and hope that I can report such progress in the future.
Women's Pension Inequality
Earlier this month, we published the report "Women and Pensions: The Evidence". The evidence tells us that men and women will reach the age of 65 with similar basic state pensions by 2025, when the average entitlement to a full basic state pension among both sexes will be more than 90 per cent. That is marked progress on the present situation and reflects the greater number of women in work. We will consider that evidence together, obviously, with the recommendations of Adair Turner's Pensions Commission to ensure that our policy proposals lead to fairer outcomes for women.
As my right hon. Friend knows, women make up two thirds of pensioners, but their income in retirement is less than two thirds of that of men. Indeed, recent Department for Work and Pensions figures show that 2.2 million women do not qualify for a basic state pension. In the light of yesterday's Turner report and with tomorrow being carers' rights day, will she go further and confirm that the Government will closely examine the Turner recommendations to make sure that we deliver a pensions system that finally offers everyone the chance of a decent income in retirement, recognising that if we get it right for women, we get it right for everybody?
I thank my hon. Friend for the way in which she has campaigned to focus attention on the issue. I am sure that she welcomes the fact that 1.9 million female carers have been helped by the second state pension and that 63 per cent. of the 5.8 million low earners who benefit are female.
The Minister will be aware that the Turner report includes the recommendation that women over 75 should receive a full pension. Although that recommendation is welcome, does she agree that she would be better advised to consider the Liberal Democrat proposal of a citizens pension for all women of retirement age?
It is always worth, albeit briefly, considering a Liberal Democrat proposal. The position of women over 75 will be a material consideration in deciding how to take forward the recommendations in Lord Turner's report.
Does my right hon. Friend agree that the percentage of women coming into work has reached a plateau? If we are to achieve a successful economy and get the next surge of women entering the marketplace and becoming productive members of our community, we need a package for women that encompasses not only pensions, but pay and child care.
If one considers full time and part time, the number of women entering work is actually increasing. My hon. Friend is right that if we are to see a sustained increase in the number of women who choose to return to work, it is important to ensure the implementation of child care and other measures that promote the flexibility that women need, if they are to combine looking after a family with being at work.
I agree with the Minister that this is very important. I welcome what Lord Turner said yesterday, especially his particular attention to women and his stressing of the importance of flexibility for parents and carers in the work force and thereby in the provision of pensions. Unfortunately, however, the right hon. Lady will not take these decisions. She appreciates the difficulties of millions of women, but the Chancellor—
Order. We do not have a great deal of time. The hon. Lady must ask her question, not make a statement.
What will the right hon. Lady do to make the Chancellor see sense in this respect so that he appreciates the problem, stops rubbishing the Turner report, and does something for women pensioners?
The position was clearly set out yesterday by the Prime Minister and the Work and Pensions Secretary. We will consider the Turner recommendations as a Government. We will take account of the pressing importance of meeting the needs of women, in particular, that arise from the necessity for flexibility in the currently inflexible pensions system, and ensure that we have a set of proposals for women that are sustainable. These decisions will be taken by the whole Government.
In a forum on women's pensions that was organised in early November in Milton Keynes with my local chamber of commerce, the view was strongly expressed that there needs to be a universal basic state pension available on the basis of residence, as suggested by Turner, if women are to benefit in future. Will my right hon. Friend take that message forward very strongly to her fellow Ministers to ensure that that is incorporated?
My hon. Friend is absolutely right. That aspect of Turner's recommendations is potentially particularly beneficial to women. It is one of the proposals that will be looked at very closely because of the importance of securing a pensions settlement that recognises the age-old inequality of the system in relation to women.
Business of the House
I welcome the Deputy Leader of the House to the Dispatch Box and ask him to give us the business for next week.
As you are aware, Mr. Speaker, my right hon. Friend the Leader of the House is on an overseas ministerial engagement. He has asked me to pass on his apologies to the House for his absence today.
The business for next week will be as follows:
Monday 5 December—Second Reading of the Work and Families Bill.
I remind the House that on that day my right hon. Friend the Chancellor of the Exchequer will present his pre-Budget report and my hon. Friend the Minister for Local Government intends to make a statement to the House on the provisional local government finance settlement for England.
Tuesday 6 December—Remaining stages of the London Olympics Bill.
Wednesday 7 December—A debate on fisheries on a motion for the Adjournment of the House.
Thursday 8 December—Estimates [1st Allotted Day]. There will be a debate on the regulation of the pharmaceutical industry. Details will be given in the Official Report. At 6 pm the House will be asked to agree all outstanding estimates.
Friday 9 December—The House will not be sitting.
The provisional business for the following week will be:
Monday 12 December—Second Reading of the Armed Forces Bill.
Tuesday 13 December—Opposition Day [11th Allotted Day]. There will be a debate on an Opposition motion in the name of the Liberal Democrats. The subject is to be announced. That will be followed by proceedings on the Consolidated Fund Bill.
Wednesday 14 December—A debate on European affairs on a motion for the Adjournment of the House.
Thursday 15 December—Remaining stages of the National Insurance Contributions Bill.
Friday 16 December—The House will not be sitting.
The House may wish to be reminded that we will rise for the Christmas recess at the end of business on Tuesday 20 December and return on Monday 9 January.
Following is the information: In so far as they relate to the influence of the pharmaceutical industry (Fourth report of the Health Committee, session 2004–05 (HC 42)) and Government response to the Committee's Fourth Report into the influence of the pharmaceutical industry (CM 6655).
I hope that the Leader of the House enjoys his trip. I can well understand his desire to leave the country after the flak that he got last week for delaying the debate on police reform. I am afraid that the Deputy Leader of the House will have to take the flak in his place this week.
Does the Deputy Leader of the House realise how angry Members on both sides of the House are that the Government have again published another week's business and there is still no sign of the reinstatement of the debate on police reforms, even though there are several days on which business is light? The deadline for forces to submit their plans for merger with their neighbours is 23 December. It is simply iniquitous that the House is not being given the chance to debate these matters before that date.
One way of making time would be to postpone the Second Reading of the Armed Forces Bill until January. It introduces a new disciplinary system for the three armed services and, as Admiral Lord Boyce said recently, the armed forces currently feel under legal siege. Ministers have had months to prepare and it is not right that the Government are now planning to rush the measure through when the Opposition and those interested in it have had so little time to consider it. It is a 250-page Bill and, as yet, there are no explanatory notes for one of the most complex measures in the Session. It is not acceptable to rush it through.
Last week, the Leader of the House dismissed my request for an urgent statement on reports that the Parliamentary Under-Secretary of State for Defence, Lord Drayson, may have been responsible for a company that sold substandard vaccines to the armed services. Does the Deputy Leader appreciate the importance of those reports? When will Ministers brief the House on what they are doing to investigate them?
The Leader of the House has also consistently ignored my request for a statement on the forthcoming Hong Kong trade talks. They are a fortnight away and the future of millions of people in the developing world depend on them. Hon. Members of all parties want to express their views to the Government. Why are we not being given an opportunity to do so?
When will the House be given a chance to debate the Turner report on pensions? Statements of the sort that we had yesterday inevitably allow only a limited number of hon. Members to ask questions and raise points of concern. The report is sufficiently important to be debated as soon as possible. Are the splits in the Government so bad that Ministers are trying to bury it without letting Members of Parliament have the opportunity to debate it?
The police reforms on which the hon. Member for Epsom and Ewell (Chris Grayling) and other hon. Members have called for a debate have already been the subject of a well-attended Adjournment debate this week. Let me remind hon. Members of the timetable. More than three weeks remain for making representations on the first key round of consultations. Where there is no agreement by police authorities, a further consultation period will take us through next January, February and March. That allows time for the debate that my right hon. Friend the Leader of the House said last week and, I believe, the previous week, could happen in the new year.
I note the hon. Member's comments about the Armed Forces Bill. It is important that proper notes, which are as full as possible, are available to all hon. Members and I shall ensure that my right hon. Friend the Secretary of State for Defence is aware of that.
My right hon. Friend the Leader of the House made it clear that allegations in print against my hon. and noble Friend Lord Drayson appear to have no foundation in fact. There is therefore no intention to hold a debate on them.
It is important to note that not only were the Hong Kong trade talks aired at Department of Trade and Industry questions prior to the business question, but that a report back on them will be made to the House. There has been ample opportunity for debate on the matter and there will be further opportunities to put questions to my right hon. Friend the Secretary of State for International Development next week.
I hope that Lord Turner's report, which was published yesterday, will be the subject of constructive and continuing debate. It would be wrong within 24 hours of its publication to jump to any conclusions and I advise all hon. Members to read it carefully and contribute to the debate.
Could my hon. Friend reassure me that the foundations of Government policy continue to include social justice and economic sustainability? If so, why are we pressing ahead next April with the self-invested personal pension scheme, which offers tax relief on the purchase of homes? That will be enormously expensive—the cost will be greater than the Government anticipate. Will my hon. Friend ask one of the Chancellor's team of Ministers to make a statement to the House and consider the approach of offering such tax relief only if the required houses are made available for social housing? That would be one way of squaring the circle.
My hon. Friend raises an important point. What lies behind the issue is the need for more to be done by individuals and companies to provide for pensions, and the need to remind people that they must make proper provision to enjoy in retirement the lifestyle that they seek to have. The proposal to which he refers is a worthwhile one, which has commanded a lot of support, and it will be yet another way of ensuring that people can provide for their pensions. The Government have ensured, however, that 2 million pensioners have been raised out of poverty, and I am sure that we will continue to do more.
May I point out to the Deputy Leader of the House that the Westminster Hall debate to which he referred allowed perhaps six Members to speak about police restructuring? It is no substitute for a debate in this Chamber.
Is it possible, following the announcements in the last week, to have a debate on the resumption of building nuclear power stations? Many of us feel that those are not economically viable, that they represent a real danger and that they should not be resumed. It would be right for the House to have the opportunity to debate that matter.
Can we have a debate on social services? I do not know whether the Deputy Leader of the House is aware of the inspection by the Commission for Social Care Inspection, which revealed that one in four councils received only nought or one star for social care, which means that those councils are potentially failing vulnerable people, the elderly and children. We do not debate that subject enough in the House, and perhaps we should do so in the near future.
Lastly, can we have a debate on local and regional newspapers? I am aware of early-day motion 1158, tabled by the hon. Member for Rhondda (Chris Bryant), which points out the situation in south Wales.
[That this House notes the proposed job cuts at Trinity Mirror in South Wales; further notes that Trinity Mirror in owning Wales on Sunday, the Western Mail, the South Wales Echo, the Rhondda Leader and the Pontypridd Observer, holds a virtual monopoly of the local newspaper market in South Wales; believes that a strong and varied newspaper market is vital to the democratic and journalistic health of South Wales; urges Trinity Mirror to reconsider its policy of combining editorial posts on separate titles; and urges the Competition Commission to consider a review of the South Wales newspaper market.]
We have a similar situation in the west country, with the Bristol Evening Post, Western Daily Press and associated newspapers, which have had substantial job losses over recent months, and we now know that the entire group is up for sale. Does he agree that local and regional newspapers are vital to local communities, that they must have proper news-gathering facilities, and that for our democracy we need local newspapers in independent control that are able to serve the communities that we represent?
The hon. Member raised the issue of the policy on nuclear power stations. As my right hon. Friend the Secretary of State for Trade and Industry has made clear, before any decision is taken on proceeding to build any new nuclear power stations, the fullest public consultation and the publication of a White Paper setting out any such proposals will be required. I am sure that there will be ample opportunities to debate the issue on the Floor of the House.
In respect of social services, and particularly social care, it is important that all social services perform at the highest level when protecting and providing services for vulnerable young people as well as the elderly and others. I am sure that the findings of that survey will be studied with care and that appropriate action will be taken to ensure that there are no underperforming services in any part of the country.
On local and regional newspapers, of course they play an important part in disseminating information to people. As I think all hon. Members know, however, modern technology, including internet services, is putting extreme pressures on the print industry. I, for one, hope that that has a vibrant future, and I am sure that it has. I am afraid that I cannot offer the hon. Member an early debate, but I am sure that his concerns are noted.
My hon. Friend will be aware of early-day motion 434, which deals with the appalling pay and conditions suffered by the House of Commons cleaners, and which has 178 signatories so far.
[That this House values the cleaners who maintain high standards of service to Parliament; believes the parliamentary cleaners should be treated with respect and that it is wrong that, despite the widespread concern over their pay and conditions of employment, their pay has only increased from the national minimum wage of £4.85 per hour to £5 per hour; is concerned that the parliamentary cleaners only enjoy 12 days' paid holiday and have no company sick pay or pension; believes the time has come to end this sorry state of affairs; and urges the parliamentary authorities to reach agreement with the two contractors on making available the necessary resources to ensure that cleaners earn the London living wage.]
Is he aware that the current negotiations would mean major job losses and a reduction in the standard of cleaning, and do not address sick pay, holidays or pensions? Does he agree that the cleaners, who do sterling work in this House, deserve some Christmas cheer?
I welcome my hon. Friend's comments although, as my right hon. Friend the Leader of the House has informed the House, it is not ultimately a matter for the Government but for the House of Commons Commission, which has made its position clear—namely, to resolve two of the key issues raised by my hon. Friend. The first is the provision of proper facilities for the cleaners. I gather that those have been provided, but that for some reason they have not so far been taken up. Secondly, there is a substantial pay rise—in excess of 15 per cent.—on the table. No one will lose their job as a result of that pay rise because jobs are available elsewhere, even if not on the Estate and in the House. That is our information.
The parties should get around the table. A 15 per cent. pay rise seems generous given the present rate of inflation, and it is certainly worthy of further talk and negotiation. I hope that they can reach a settlement before Christmas.
The activities of the House are, sadly, increasingly irrelevant to the people of this country, and the ability of the House to do the job that people send us here to do is increasingly undermined. Will the Government, through the Deputy Leader of the House, look again at the request from both sides of the House for a major debate in this Chamber on a matter that is deeply important to everybody in the country, particularly in England and Wales? I refer to the restructuring of the police. We must have a debate on that subject before Christmas or the Government really will be held to account.
I think that I have made it clear that there is not likely to be a debate on the Floor of the House before Christmas, and also that the consultation period will be extended for a further four months in those areas where agreement has not been reached. My right hon. Friend the Minister for Policing, Security and Community Safety, who addressed Members in the Westminster Hall debate, has made it clear that she is willing to talk to individual Members, as well as police forces, who have concerns. The consultation period has not yet ended. There are another three weeks for Members and others to make their views clear, so it seems inappropriate to hold a debate now when the consultation period has not finished.
My hon. Friend may be aware that 28 cancer charities have bonded together to form a cancer campaigning group. Although they recognise the amazing things that have happened under the Government in terms of care, treatment and early diagnosis, there is much more to do. They and many others are of a mind to discuss the possibility of a cancer plan 2 to move things forward. Will my hon. Friend advise me on how we might do that within the procedures of the House, by debate, summit or whatever?
I welcome my hon. Friend's championing of that cause and I know that the cancer campaigning group provides a united voice on cancer issues, keeping cancer on the agenda and at the forefront of people's minds. Every Member will be aware of the lives that have been transformed since 2000 with the introduction of the current cancer plan, which put cancer at the heart of the Government's health policy. Indeed, we have cut death rates for breast cancer in women and lung cancer in men faster than anywhere else in the world and, with the 1,177 more cancer specialists, we intend to cut cancer mortality further.
The Deputy Leader of the House will know that yesterday the Home Office slipped out a new policy on the levels of possession of class A drugs, which will constitute the crime of possession with intent to supply. Why was that announcement made yesterday? Why was it not made to the House, and when will a Minister from the Home Office come here to explain himself or herself?
A consultation document was published on Wednesday. It reflected measures that were called for by the police to set supply thresholds to eliminate any inconsistencies between police forces in catching and prosecuting drug dealers. It removes the excuse used by dealers that their drugs are for personal use only. The House will want to know that there have been record seizures of class A drugs in recent times. I am sure that this will be a subject of continuing debate and discussion within the House. I hope that the hon. and learned Gentleman is supporting what the police were calling for.
My hon. Friend will be aware that my right hon. Friend the Prime Minister gave a huge boost this week to the nuclear power lobby. There are a number of us on the Government Benches who feel that the deep-mine coal industry has a part to play in our future energy needs. We are now down to eight pits. When will we have an urgent debate about taking the industry back into public ownership to guarantee its long-term future?
I fear that neither a debate nor that policy is on the Government's agenda. I stress the important role that coal has played in the past and that I hope it will play in the future in meeting our energy needs.
Can we have a debate on planning laws, and specifically on the PPG3 planning rules that designate people's back gardens as brownfield sites? It enables developers to exploit windfall development sites while true brownfield sites are not necessarily considered. The effect in my constituency and elsewhere is to destroy the character of the area with inappropriate windfall developments. Can we have a debate on this matter?
I am not sure that, on behalf of my right hon. Friend the Leader of the House, I can promise an early debate on the Floor of the House. I am sure, however, that the subject would be a suitable candidate for an Adjournment debate, which would give the hon. Member a chance to spell out her concerns in more detail.
On the subject of the House of Commons cleaners, I am slightly concerned by the Minister's earlier response. I understand that the proposal on the table would result in up to 30 job losses on the House of Commons Estate, which would mean a major reduction in cleaning standards in this place. May I urge my hon. Friend to do all that he can to bring the Serjeant at Arms to the negotiating table with the trade unions, the cleaners and the contractors to try to bring about a resolution of this dispute?
I recognise that many hon. Members are concerned about this issue. There seems to be a degree of less-than-wholly accurate information being transmitted, although I do not impugn the motives of those who are circulating it. The position is as I have stated. Everyone is guaranteed a job. If my hon. Friend is saying that that job may not be in this place, that reflects what I said a few moments ago. This is a matter not for the Government but for the House authorities. I have set out, I think fairly, the offer that is on the table and have expressed my hope that it is agreed before Christmas.
What is the future of the hapless Northern Ireland (Offences) Bill, which would effectively give an amnesty to terrorists on the run, bearing in mind that every party in Northern Ireland is opposed to this legislation with the exception of Sinn Fein? It should also be borne in mind that every person who spoke at the meeting of the British-Irish parliamentary body, which met at Edinburgh on Monday, from both north and south of the border was opposed to the legislation. Only one Government Back-Bench Member supported it during the debate. Is it not time that it was knocked on the head completely? It is very bad legislation.
No, it is not—the Bill is part of the peace process, which has brought big dividends to us in this part of the United Kingdom and, most importantly, to Northern Ireland. These are always difficult decisions. Hon. Members have spoken with a great deal of passion and anger about their personal experiences. Nothing can bring back people who have been killed by terrorists. However, we would not be where we are today if we had not embarked on a peace process that required us to move forward rather than to look back. That has been one of the causes of the problems in Northern Ireland. I would expect someone with the experience of the right hon. Gentleman in this area to promote the peace process rather than make criticisms that have been made by others, and which the Government do not accept.
The chief constable of the North Wales force has today criticised the unseemly rush in which the Government are deciding the future of Welsh policing. In Wales, there is a strong feeling that the views expressed by Mr. Giffard on an all-Wales police force do not take into account the peculiar geography and the circumstances within Wales. Will my hon. Friend please reconsider the issue of a debate, particularly on the future of policing in Wales?
Those views are not shared by the association that represents police constables in Wales and the Association of Chief Police Officers. If there are concerns, I have laid out a timetable to my hon. Friend—the decision will be taken after consultation, and the consultation period has not yet ended.
Virtually everything that the Deputy Leader said on policing is wrong. I was lucky enough to be called in the Westminster Hall debate. The Minister did not answer any of my questions. There were Opposition Members right round Westminster Hall to within two seats of where the Parliamentary Private Secretary should have been sitting who were not called. At a debate that I had with the Under-Secretary of State, he could not answer any questions from the chief constable and the chairman of the authority—
Order. I allowed the hon. Gentleman to ask a question because he seemed so excited and I wanted to calm him down. It seems that that has not helped. Will he ask a question? If he does so, he may get an answer.
Can we replace the debate on pharmaceutical regulations with a debate on a substantive motion on restructuring the police forces?
The opportunity to have a debate on this issue will arise early in the new year. I am sure that one of the key facts that my right hon. and hon. Friends will want to put forward is the increase by 14,000 in the number of police officers, which is why the report of Her Majesty's inspectorate has recommended, in part, a reorganisation of the policing forces.
It is a while ago now since the excellent Animal Welfare Bill was published. There was then an indication that Second Reading would take place before Christmas, but that now seems unlikely. When are we likely to have the Bill before us and why has there been a delay?
I hope that we are able to consider that Bill when parliamentary time allows that to happen. I regret that it has not allowed it to date.
In announcing the new appointments to the Northern Ireland Parades Commission, the Secretary of State for Northern Ireland referred to a fresh start on the issue of parades in Northern Ireland, which has caused so many difficulties with attacks on parades and the obstruction of parades. Can we have an early debate so that we make it absolutely clear that as well as fresh faces on the commission, we need a fresh framework in which all of these issues can be discussed and decided by root-and-branch change, and not by tinkering with the problem?
I will ensure that my right hon. Friend is aware of the hon. Member's concern about this matter, if he is not already.
My hon. Friend will be aware of the significant increases in young women being forced into prostitution in this country, particularly from eastern European countries. Will he arrange for a Government statement on what measures are in place or are proposed to deal with this evil trade in human beings?
I know that my hon. Friend, police forces and enforcement authorities take this matter extremely seriously. Indeed, there was a high profile case this week—it is vital that this evil trade is stamped out. Police authorities have the necessary powers and are using them, and we hope that they will continue to use them as effectively as possible.
The Deputy Leader of the House rightly spoke of the importance of the publication of explanatory notes on the Armed Forces Bill, but I understand that they are not to be published until Friday next week, which is not even a full parliamentary day before Second Reading. The Bill has 373 clauses and 15 schedules, all pretty impenetrable. Will he undertake either to speed up publication of the explanatory notes or to slow down Second Reading?
I undertake to ensure that the explanatory notes are made available as quickly as possible.
Will my hon. Friend press for an early debate on media coverage of Select Committee sittings? There has been a sharp decline in the number of hours of coverage. The independent companies say that it is because they cannot afford it, but one would expect the BBC to step in. Coverage of the scrutiny process is central to our parliamentary democracy.
I agree with my hon. Friend. Indeed, I raised the issue during an Adjournment debate in Westminster Hall last month. It is important. I shall ensure that both the House authorities and the BBC are aware of the concerns of my hon. Friend and, I am sure, other Members.
I am grateful to the Deputy Leader of the House for giving us his view of how police reorganisation should be debated here, but it is an important issue that affects all Members on both sides of the House. The Government should think again about a debate before the end of the year, so that they may be in a position to assess parliamentary opinion rather than just the opinion of the Association of Chief Police Officers, with its method of canvassing for information.
As I have said, there will be a debate. It will take place at the end of the first phase of the consultation that ends later this month, before final decisions are made where there are contentious matters, and before the end of the final consultation period in another four months-plus starting from mid to late December. There will be ample opportunity to debate the reorganisation.
I am sure my hon. Friend agrees that the Ministry of Defence's honouring of veterans who served in the war could be extended to others who also served in the war, particularly those who were in the Land Army and the Bevin boys. Those people have been applying for badges, but unfortunately have been turned down. Will he use his good offices to try to rectify the position?
I shall ensure that the appropriate Minister is made aware of what my hon. Friend has said.
You will recall, Mr. Speaker, that this time last Thursday, the Leader of the House sought to give us the impression that Members would have an opportunity to debate legislation relating to the reorganisation of the police. It is true that, were Kent to be merged with another county, the Channel Tunnel Act 1987 would have to be amended through primary legislation, but I do not think that that is quite what the Leader of the House had in mind. He knows perfectly well that all the reorganisation can be dealt with by means of statutory instruments.
At the end of the famed Adjournment debate in Westminster Hall, the Minister for Policing, Security and Community Safety sought to explain to the House—as has the Deputy Leader of the House today—that there would be an opportunity for a debate on the police. Almost immediately afterwards, sources very close, shall we say, to the Home Secretary were to be found briefing lobby journalists, saying that the measures would go through, that it was all done and dusted and that it did not matter.
There are two non-sitting Fridays between now and Christmas. Why can we not have the debate on one of them?
In view of the clear strength of feeling among Opposition Members, I might ask why one of their important Opposition days was not used to debate the issue. [Interruption.]
Order. Whatever we do, we must allow the Deputy Leader of the House to reply. Some Members may not be too happy with the reply, but that is another matter.
They have their reply, Mr. Speaker.
May we have a debate next week on regulation of the video games industry? Has my hon. Friend seen early-day motion 1172?
[That this House denounces the recent rise in violent video games; condemns the forthcoming video game Bully, which allows players to adopt the persona of Jimmy Hopkins, a 15-year-old thug who has been incarcerated in a boys' boarding school, and in which points can be scored by terrorising other pupils with a range of physical and psychological abuse; further notes with grave concern that last year more than 31,000 children and young people spoke to a ChildLine counsellor about bullying; and calls on the Government to urge the British Board for Classification to take a much more cautious approach with this game and ban it from being sold in the United Kingdom.]
If my hon. Friend has seen the motion, he will know that Rockstar has decided to publish a game called "Bully", and that a central character is someone called Jimmy Hopkins. Players will be given points as the character terrorises other schoolchildren psychologically. Given the rise of bullying, I believe that the video should be banned. May we have a debate so that we can hear the Government's view?
My hon. Friend is right to raise the continuing concern about the matter. While I cannot offer him a debate, I shall certainly ensure that the Minister responsible for such matters is aware of the concern.
Yesterday, a petition bearing more than 155,000 names was handed in at No. 10 Downing street as part of the continuing campaign to save Scotland's historic regiments. As a Scottish Member, the Deputy Leader of the House will know of the strength of feeling about this issue, and the real anxieties about recruitment. He will also know that the golden threads that were promised for the new regiment look particularly threadbare when we learn that the Black Watch cannot wear the famous and iconic red hackle at all times. May we have a debate in Government time, even at this late stage, to stop this amalgamation madness?
I pay tribute to the veterans and those currently serving in our armed services. The design of the cap badge for the Royal Regiment of Scotland is the culmination of several months of discussion and consultation with both those who are serving and those who have retired. The design was submitted to Her Majesty through the Army dress committee and has been given Royal Assent. It is a requirement for each new regiment to have a unifying symbol and all officers and soldiers in this new regiment will wear the new cap badge from formation day.
An announcement was made earlier in the year that recognised the strong identification that local people and those who have served in regiments feel with historic regiments. Many aspects will be preserved, not just dress but museums and anniversaries. I think that the Government have gone a long way towards addressing the concerns, but I note the hon. Gentleman's comments.
May we have a statement early next week on whether United Kingdom airports and other facilities have been used by the United States to transfer what are described as terror suspects across Europe to be put in various interrogation centres? Will my hon. Friend bear it in mind that allegations have been made about torture? If such torture were taking place in centres in parts of Europe, it would be in defiance of both British and international law. I hope that the Foreign Secretary will be able to come to the House early next week to set our minds at rest.
The Foreign Secretary, as part of the European Union presidency, wrote to the United States Secretary of State, Condoleezza Rice, seeking clarification of the issue and of media reports of so-called CIA terror camps in eastern Europe. I suggest that my hon. Friend await the response before calling for a further statement.
Consultation, or lack of it, seems to be a recurring theme in today's business questions. This morning I met Sir Bob Reid, chairman of Milton Keynes Partnership, the Government quango charged with delivery of the expansion of Milton Keynes. He confirmed that the people of Milton Keynes have only until 15 January to respond to the document. Will the Deputy Leader of the House find time for a proper debate on the Floor of the House? There is a genuine fear throughout the country that expansion of our cities is being forced on us without proper local consultation.
I am sorry to hear that the hon. Member feels that. I shall make sure that the appropriate Minister is aware of his concerns about the timetable for that consultation.
May we have an early debate on the no-blame approach to bullying in our schools, as adopted by Liberal Democrat-controlled Bristol city council? Does the Deputy Leader of the House share my view that, although that council may not want to blame or punish bullies, the voters of Bristol will want to blame and punish the council for its irresponsible approach to child protection?
I share my hon. Friend's views that there must be zero tolerance towards bullying, and that firm action must be taken to tackle it. As in my local high schools, that should include interviewing bullies' parents to ensure that they are fully aware of the consequences of such acts. I favour, as the Prime Minister said two weeks ago that he did, the tougher rather than the tender approach on this subject.
May we have an urgent debate in Government time on the imprisonment of British citizens abroad? In Spain in 1998, my constituent Teresa Daniels was convicted of drug smuggling after an outrageous trial in which she thought she was a witness not a defendant. She was released by the Spanish authorities and has now been extradited back to Spain to serve a 10-year prison sentence, more than five years after she was released. Does the Deputy Leader of the House agree that such a debate would allow the concerns of Fair Trials Abroad to be expressed about a miscarriage of justice, and pressure to be put on the British Foreign Secretary finally to raise the matter with his Spanish counterpart, in the interests of natural justice—a principle that ought to unite all member states of the European Union?
As the hon. Member knows, it is not policy to comment on individual cases that may still be subject to appeals and other proceedings. He will know that my right hon. Friend the Foreign Secretary does raise cases of apparent miscarriages of justice, and has made clear to the House in response to other hon. Members' questions his involvement in certain cases at certain stages. This is an important issue and I know that the hon. Member will be working tirelessly on behalf of his constituent, and that the Foreign Secretary and his officials will be following his comments.
The Prime Minister announced the long-awaited energy review at the CBI earlier this week, and I understand that a written statement was placed in the Library. It is unfortunate that an issue of such importance was not brought to the House as an oral statement. Can my hon. Friend give us an assurance that there will be an early debate on the issue in the Chamber in Government time, because it is vital that the House should have an input into the energy review at an early stage, rather than after it, when it is a fait accompli? Nuclear power and its relationship with other aspects of energy policy is a vital issue—one of the most important that the Government have on their agenda.
Any decision taken on the future of nuclear power will, as I said earlier, be the subject of a White Paper, which is likely to be accompanied by a ministerial statement. There will be ample opportunity for a full debate on the Floor of the House.
Is the Deputy Leader of the House aware that my constituency continues to be plagued by unauthorised Traveller encampments in the green belt—a matter on which I pressed him during the July Adjournment debate? What has happened to the long-overdue review of Travellers and planning law, and when will district councils be given stronger powers to resist the current abuse?
I shall find out what has happened to the review and ensure that the appropriate Minister writes to the hon. Member.
It was left to a member of the public to notify me of the disgraceful actions of FirstBus in my constituency in unilaterally cutting services and closing a depot. Will my hon. Friend arrange a debate in Government time on the conduct of bus companies, and when will the Government consider re-regulating bus companies outside London?
I hope that my hon. Friend will have the chance to put that to Transport Ministers next Tuesday, at Transport questions. Obviously, the provision of local bus services affects the lives of many people and has to be handled sensitively. I hope that the company that he mentioned will note his comments and I am sure that it will want to meet him to discuss his grave concerns on behalf of his constituents.
Following the comments of the hon. Member for Perth and North Perthshire (Pete Wishart) on the Black Watch, I am sure that my hon. Friend will be aware of the high profile of that issue in my constituency. My grandfather, Hugh MacDonald, served in the Black Watch, and is buried in the military cemetery in Gibraltar, where he died in 1941. I believe that one of the concessions made to the Scottish regiments during the merger process was that they would retain the right to their identity via the right to wear the cap badge at all times. Obviously, in the case of the Black Watch that means the red hackle. Will my hon. Friend use his good offices to ask the armed forces Minister to intervene to allow the Black Watch and the other Scottish regiments at least to retain their identity?
No, I cannot give my hon. Friend that undertaking. There has been a long process of discussion on the reorganisation of the regiments, and it was the settled view of the armed forces themselves that this was the way ahead. I am sure that the memories to which my hon. Friend paid tribute will never be lost.
Can the Deputy Leader of the House explain to us why the Armed Forces Bill, which has been long years in the making, has been shoehorned into the parliamentary timetable at a time when no one can possibly prepare properly for Second Reading, whereas the debate on police restructuring, for which everyone is ready, prepared and raring to go, has been withdrawn from the parliamentary timetable? Is it not blindingly obvious that the former should be delayed and the latter reinstated?
No, it is not. The Armed Forces Bill is an important piece of legislation that has to be properly timetabled in this House and the other place, and clearly the suitable time for debating it is in eight or nine days' time. As I said, I hope that the fullest possible information on the Bill is available. I know that the hon. Member, like other hon. Members, will not come cold to this subject.
Tomorrow is carers' rights day. Does my hon. Friend agree that it is now timely to have a debate on carers' rights, particularly on issues such as the overlapping benefit rule, which means that carer's premium and carer's allowance cease for carers over pension age? That matter has been raised by many carers in my constituency, and no doubt will be raised by other carers throughout the country tomorrow.
Carers do a fantastic job and we all owe them a debt. I can ensure that my right hon. Friend the Secretary of State for Work and Pensions is aware of the issue that my hon. Friend highlighted, and I am sure that he will want to respond.
Two days ago, the national security archive published analysis of recently released documents that show conclusively that the then British Government misled the House and the country about Indonesian atrocities in East Timor in 1975 and further suppressed information about the killing of Australian and British journalists. For example, at Christmas 1975 the then British ambassador to Indonesia sent a cable to London describing Indonesian soldiers as going
"on a rampage of looting and killing".
In the same cable, he went on to say:
"if asked to comment on any stories of atrocities, I suggest we say that we have no information".
May we have an urgent debate on the previous Government's complicity in the cover-up, which will give Members an opportunity to press the current Government to release further documents that will be of assistance in the much-delayed inquest, to take place in Sydney early next year, on one of those British journalists, Brian Peters?
I read the accounts that the hon. Member has shared with us and I found them as disturbing as he did. I cannot offer him the debate in this House that he asks for, but I hope that he manages to secure an Adjournment debate that allows him to air these issues with the Minister responsible and to get an appropriate response.
Given that an increasing number of housing developments built on contaminated land are coming to light, such as that in Littleport, which is in my constituency; given the contradictory views of the Office of the Deputy Prime Minister and the Department for Environment, Food and Rural Affairs about the inclusion of soil sampling in the house sellers pack; given the comments of the Leader of the House in response to a recent question from the hon. Member for Birmingham, Hall Green (Steve McCabe); and given the now obvious problems in implementing part IIA of the Environmental Protection Act 1990, will the Deputy Leader of the House arrange an urgent debate on contaminated land development, so that we can clear up this mess?
I can ensure that the concerns that my right hon. Friend the Leader of the House reflected in his response to that question are drawn to Ministers' attention, so that the hon. Member can assist his constituents and we can hopefully ensure that the policy is appropriate to the contaminated site issue.
May we have a debate on the future of the the hon. Member for Somerton and Frome (Mr. Heath), this is an important issue and we all enjoy a wide diversity of competitive and lively national newspapers. All too often, however, we see monopolistic practices in our local newspaper markets—practices that the Government, through the Competition Commission, should surely investigate.Rhondda Leader, a very fine local weekly newspaper in which I happen to have a regular column? It has a rising circulation, but its problem is that it belongs to Trinity Mirror, which also happens to own nearly every newspaper in south Wales. Further to the point made by
My hon. Friend can raise his concerns directly with the Competition Commission and I urge him to do so. My right hon. Friend the Secretary of State for Trade and Industry takes competition matters very seriously.
Will the Deputy Leader of the House arrange for the Home Secretary to make an urgent statement to this House on the effect on the criminal justice system and natural justice of leaked reports that the Sentencing Guidelines Council is about to recommend that sentences for muggers be cut from an average of three years in jail to two and a half years?
Those guidelines constitute arrangements made under criminal justice legislation. Previous offenders were in the community with no oversight at all for a substantial part of their sentence. It is important that a more onerous regime for offenders be introduced, so that if they breach licence conditions, they can go back to jail. The problem that the hon. Member highlights, and which was reported, is that young teenagers on a first offence—I am not sure that mugging was the offence; I think that it was snatching of bags that involves no violence—may not, under magistrates' guidelines, get an automatic custodial sentence. That will be a matter for debate in this House and elsewhere.
Last week, a disgraceful incident occurred in which policemen stopped a woman breastfeeding on a bench in a high street. This House will spend a lot of time discussing whether to ban smoking in public places, yet there are already 68 signatures to early-day motion 1046, on breastfeeding in public places.
[That this House recognises the benefits of breastfeeding for babies and welcomes the provisions of the recently introduced Breastfeeding etc. Bill which propose to address some of society's attitudes to breastfeeding; notes that research shows that breast milk is the ideal first food for most babies; regrets that the UK has one of the lowest breastfeeding rates in Europe, with just one in five babies receiving breastmilk by the time they are six months old, although the World Health Organisation recommends that babies need nothing other than breastmilk for the first six months of life; is deeply concerned that many mothers report having been harassed for breastfeeding in public while others have stopped breastfeeding early or chosen not to breastfeed as they have anticipated embarrassment or difficulties in feeding their babies whilst in public; supports UNICEF's call for legislation to protect breastfeeding mothers' rights to feed their babies in public areas and the Baby Friendly Initiative; appreciates that social attitudes are slowly changing but that there is a long way to go; and calls for greater understanding and positive attitudes to ensure that breastfeeding is a normal part of everyday life.]
In the light of those points, will the Deputy Leader of the House consider allocating parliamentary time to this really important issue, so that we can permit a perfectly natural activity that has so many beneficial outcomes? I should point out, Mr. Speaker, that I am not calling for breastfeeding in this House.
I share the hon. Member's views on this issue; indeed, I was in Gracemount, in my constituency, last Friday discussing this very subject with a community health group. I was going to say that it is important that we bring our attitudes to this subject into the 21st century, but of course, breastfeeding is a natural function that has stood us in good stead in the past. I will ensure that the hon. Member's views are made available to my colleagues in the Department of Health.
I hope that the Deputy Leader of the House agrees that, when a Minister speaks at the Dispatch Box, his comments should be factually accurate. That is particularly true of the Prime Minister, but yesterday, he said at Prime Minister's questions that from midnight last night, there will be a maximum wait of six months for operations in the NHS. This morning, I checked with my hospital and 437 people are still waiting more than six months for an operation. Can the Deputy Leader of the House help me by explaining how the Prime Minister might go about correcting what I am sure was a slip of the tongue?
I will certainly ensure that there is an inquiry into why services in the hon. Member's health authority seem to be failing. They are not failing in other health authorities, and there will be a reason for that.
Has the Deputy Leader of the House had the opportunity to look at early-day motion 1120, signed by Members from all parts of the House, which pays tribute to the soccer legend George Best, who died last week?
[That this House mourns the passing of East Belfast and Northern Ireland soccer legend George Best; salutes his unequalled football skills; acknowledges his place at the pinnacle of world class soccer; and tenders to his family its deepest condolences.]
Will the Deputy Leader of the House join me in expressing condolences to the family, and will he urge the Secretary of State for Northern Ireland to make a statement to the House on the Government's intentions regarding a national stadium, given that a large body of opinion in Northern Ireland feels that it should be named after the soccer legend?
I join the hon. Member in praising the memory of George Best; indeed, I used to watch him play for one of the Edinburgh teams in the 1980s, and he set the stadium alight with his dazzling skills. I will ensure that the Secretary of State for Northern Ireland is aware of the hon. Member's strong feelings on behalf of his constituents and others on the question of a national stadium.
The Deputy Leader of the House represents a Scottish constituency, which perhaps explains the breathtaking insouciance of, and even the occasional inaccuracies in, his answers concerning a debate on police reform. We are talking about the most important reform of policing in England and Wales in a political generation. No police officer in my area—West Mercia, which covers Herefordshire, Worcestershire and Shropshire—supports the Government's proposals. There should have been a debate on the principles underlying the report produced by Her Majesty's inspectorate of constabulary, which I challenge, before proceeding to detailed proposals for a merger. The Government could save some shred of honour by having such a debate before Christmas; it would be shameful not to do so.
I have been not just forthright with Members, but accurate in my comments on consideration of that Bill. I note that for all the so-called concern voiced today, not one Opposition day has been devoted to this issue.
The Deputy Leader of the House is doubtless an avid reader of the Local Government Chronicle. If so, he will see that, in today's edition, the Minister of Communities and Local Government has announced a White Paper on local government, to be published in the middle of next year, that includes proposals for structural reform. I welcome that announcement, but can the Deputy Leader of the House arrange an early debate on the relationship between that White Paper and the Lyons review, in which the Government can explain why it has taken so long to give that review any political direction?
The White Paper coming before the House next year covers a distinct policy area and, once it is published, I am sure that there will be an opportunity to debate it. Before its publication, there will be an opportunity for the hon. Member and his Liberal Democrat colleagues to provide their input.
May I revert to the amalgamation of police forces? The Deputy Leader of the House will know that the proposals are widely resisted in the east midlands, especially in Lincolnshire. He has spoken repeatedly of consultations, but does he not understand that, in a representative democracy, this House, speaking collectively, should be involved in that process? That means that there should be a substantive and votable motion before Christmas.
No, it does not. It means that there should be a debate, and one has been promised. That debate should take place at the end of the initial consultation period, which I understand is 23 December.
Points of Order
On a point of order, Mr. Speaker. At Culture, Media and Sport Question Time on 21 November, I asked whether the Secretary of State thought it proper
"to have held ministerial meetings with Philip Anschutz and other members of the Anschutz Entertainment Group to discuss their plans for . . . a casino at the millennium dome".
The right hon. Lady replied:
"I am not aware of any ministerial meetings as such having been held."—[Official Report, 21 November 2005; Vol. 439, c. 1227.]
However, in a written answer today, the Minister for Sport and Tourism states:
"Ministers and officials have had a number of meetings with casino operators . . . These include meetings with representatives of the Anschutz Entertainment Group and Kerzner International, its partner in the development of the Millennium Dome site."
Setting aside the disgraceful fact that the Secretary of State does not know what meetings Ministers in her Department are holding, I seek your advice about how best we can have the record put right.
In a sense, the hon. Gentleman has put the matter on the record by raising his point of order, but there is nothing to stop him putting down more parliamentary questions about it.
On a point of order, Mr. Speaker. At Treasury questions on 10 November, I asked the Chief Secretary to the Treasury why the UK economy was growing more slowly than any other major economy in the English-speaking world. The right hon. Gentleman's reply can be found at column 462 of the Official Report for that day, when he said that the UK was growing faster than Australia and New Zealand. Late last night, I received a letter from him apologising for misleading the House. Mr. Speaker, I seek your guidance as to how the matter can be put more clearly on the record.
Let me make it clear that the Chief Secretary would not mislead the House deliberately. I am not responsible for the quality of replies, and I repeat that there is nothing to stop the hon. Gentleman putting down an identical question and seeking elucidation about previous answers.
On point of order, Mr. Speaker. My hon. Friend the Member for Macclesfield (Sir Nicholas Winterton) made a serious point when he said that this House should concern itself with matters of great public interest. The Government have flatly refused to address the huge public issue of police reform, and I think that there is a real danger that the House's reputation will be diminished in the eyes of the public. As the guardian of the House's reputation, what powers do you have to call in the Leader of the House and the shadow Leader to discuss a way forward, so that we can have a debate and a vote before the deadline of 23 December?
rose—
Perhaps if I answer, there will not be further points of order on the matter. I am aware of the hon. Gentleman's feelings, but there is the institution known as the usual channels. These matters should be taken through the usual channels because, as he knows, the Speaker cannot determine the business for the forthcoming week. That is up to the usual channels—
That does not help the hon. Gentleman?
I am sorry, but it does not. Further to that point of order, Mr. Speaker. You will have noted the passion on all sides of the House about this matter, which needs to be debated. If the usual channels are unable to reach an agreement—and the response of the Deputy Leader of the House today suggests that the Government are not prepared to give ground, an intransigence that I find genuinely surprising and shocking—are any mechanisms available to Back Benchers to work through you to secure an urgent debate on this subject?
Further to that point of order, Mr. Speaker. Is this matter not eloquent testimony to the fact that this legislature must take back control of its agenda from the Government?
I advise hon. Members that, on this matter, I am governed by the rules of the House. I can only operate by the rules that the House has given me. I cannot go beyond them.
On a fresh point of order, Mr. Speaker.
That is a refreshing change. Thank you.
Can you assure the House that Opposition Members will not be penalised if too few Labour Members show an interest in business questions? We are very enthusiastic about those questions, but can you assure me that we will not be penalised simply because they run out of people?
The right hon. Gentleman is always helping me, and his question helps me to clarify for newer Members exactly what happens. It does not matter whether we run out of Labour Members to ask questions, because a far higher proportion of Opposition Members get called at business questions. I shall let the right hon. Gentleman into a secret: my policy is to give priority to new Members, regardless of which side of the House they are on. Sadly, some hon. Members have been left without an opportunity to ask a question today, but I think that they will be very pleased next week.
On a point of order, Mr. Speaker. May I take you back to the lack of papers available for the Second Reading debate on the Armed Forces Bill? You will know that I have raised many times the threat perceived by our armed forces as a result of the climate of prosecution in Iraq. Given the amount of public concern about the widespread threat of prosecution that young soldiers in Iraq face, is it not extraordinary that debate on the Bill should have been brought forward? It is 250 pages long, and will merely turn the system even more upside down than it already is, in many cases removing commanding officers from the decision-making process. No explanatory notes have been supplied, even though we have been given only about a week's notice of the debate.
On the general point, the hon. Gentleman is correct. Explanatory notes for Bills should be made available for Back Benchers, and I am obliged to him for raising the matter.
Further to the points of order about a debate on policing, Mr. Speaker. You will have heard the Deputy Leader of the House say that such a debate would be inappropriate before the consultation process ended even though, three weeks ago, it was apparently not inappropriate for the Government to table a debate on the subject for today. Can you help me with this matter? Does any doctrine or rule state that it is not possible to hold such a debate?
I think that the hon. Gentleman may be trying to extend business questions. He can have a go next week.
On a point of order, Mr. Speaker. Yesterday, I received a letter from Stephen Geraghty, the chief executive of the Child Support Agency. The letter responded to a written question that I tabled about the enforcement directorate. In effect, it confirms that that directorate managed to retrieve £8 million last year, but that its running costs were more than £12 million. Have you had any notice that Downing street has resolved its difficulties with the Department of Work and Pensions about the CSA's future? Will a Minister come to the Dispatch Box and give us a statement about the mater? That would help us deal with angry constituents, who express their fury at the state of the CSA nearly every week of the sitting year.
The hon. Gentleman should bear it in mind that I am a constituency MP in my own right, and that I get lots of these complaints myself. He would help me by putting down parliamentary questions on this matter, as I cannot do so.
Orders of the Day
Council Tax (New Valuation Lists for England) Bill
Not amended in the Standing Committee, considered.
Clause 1 — Dates on which new valuation lists must be compiled for England
I beg to move amendment No. 3, in page 1, line 8, at end insert—
'(1B) An order under subsection (1A) may be made in relation to an individual billing authority, a group of adjoining billing authorities or all billing authorities.'.
On a point of order, Mr. Speaker. We are dealing here with a very important piece of legislation, but it is not freestanding and does not introduce a new concept. Instead, it seeks to amend the Local Government Finance Act 1992, which makes that Act very relevant to our debate. I was shocked to be told by the Vote Office that that Act is not available. Therefore, we are being asked to debate a Bill that amends an Act of Parliament, a copy of which is not available for right hon. and hon. Members to peruse. I therefore ask that you consider suspending this sitting until such time as that Act of Parliament is available.
I think that we must continue, and I have called Sir Paul Beresford to move his amendment. However, I instruct the officials that copies of the Act must be available for the right hon. Gentleman and any other hon. Member who wishes to see it.
Further to that point of order, Mr. Speaker. I am grateful for your helpful suggestion, but can you confirm that if by any chance the Act is not available by the time we reach Third Reading, the sitting would have to be suspended because that debate might require references to the Act for the sake of completeness?
I like to deal with here and now, not any period in the future.
On a point of order, Mr. Speaker—
Order. If the hon. Gentleman is going to go on about this matter, it is not a point of order.
It really is a point of order, Mr. Speaker.
Well, I shall be surprised if it is.
As you can see, Mr. Speaker, there are many references to the Local Government Finance Act 1992 in the Bill before us this afternoon. It is impossible to understand the force of the amendments without seeing the Bill that they amend. Can you give us some indication of the point in our proceedings, if we must continue, at which we will have a copy of the Act available to us?
I knew that it was not a point of order. I have instructed officials to make the Act available and when I instruct officials, the House can believe that they move quickly. They will be moving quickly as we speak and I think that the request of right hon. and hon. Members will be met shortly.
I am sure that we will be able to limp on without that Act, although I admit that I do not know it word for word. I am honoured to move amendment No. 3, which also stands in the name of my right hon. Friend the Member for Skipton and Ripon (Mr. Curry). He intended to be here to support this little amendment on this little Bill. Unfortunately, the Government's last-minute decision to replace some uncomfortable business with this relatively non-urgent Bill has caused a major conflict in his diary and he is unable to join us. My right hon. Friend and I were both local government Ministers, but I note that my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer), who was our much more learned Secretary of State, is in his place and will be able to add his support and make a few points to the discomfort of the Government and, perhaps, our Front-Bench colleagues, judging from their response to Second Reading. I am also sure that my right hon. Friend the Member for Skipton and Ripon will be able to find enough time to wheel across and join us in the event of a vote.
Bearing in mind that council tax and local authority finances are excessively complex and generally dead boring, I must express my surprise and delight at seeing so many fascinated souls in the Chamber eager to join this debate. They are even, for the moment, still awake. The intention of the amendment is quite simple and straightforward. It would enable the Secretary of State to allow, or require, a particular billing authority, a group of adjacent billing authorities, or all billing authorities to carry out valuations for council tax purposes. It is perhaps worth emphasising that because of the nature of the valuations and the banding system that applies.
On such matters, my hon. Friend's voice carries great weight with me, because I know that he has studied the subject long and hard and is an expert on it. However, I am most concerned by the scope and provisions of the amendment. Should it be added to the Bill, what would prevent a malevolent Minister from deciding to order a revaluation just for Conservative-controlled local authorities?
There would have to be some justification for doing so. An order would have to be produced, which could lead to a debate in the House and the opportunity to make points. However, given the trend of local elections, it is conceivable that there could be so many Conservative councils that a Minister had no opportunity to do anything else.
The point made by my right hon. Friend the Member for East Yorkshire (Mr. Knight) also worries me. Were such a malevolent decision to be made by a Minister, could it be subject to judicial review? Does my hon. Friend think that there would be any protection, judicial or otherwise, against such targeted, political action?
My right hon. Friend answers his own question. In such a situation, a judicial review would be a protection, although I do not really envisage such a situation arising, even if the next local government elections—as I anticipate—result in a clean sweep for the Conservatives and a fall in the number of Liberal and Labour councils. We shall have such a collection of Conservative councils that that situation might be more likely than my right hon. Friend envisages.
It is remarkable that it is accepted as completely plausible that a Government might behave in the way suggested. Would my hon. Friend care to reflect on the fact that the Government have already done so in their reallocation of local government finance and the budgets for primary care trusts? Some primary care trusts are under-funded—and not over-spent—because the Government have shifted money from Conservative areas to Labour areas on purpose.
I agree, and the amendment derives from the point made on Second Reading that it would provide an opportunity to change the way in which the funding formula worked, to make it fairer and restore the balance that existed before the funding formula under which we now suffer.
I believe and I hope that you agree, Madam Deputy Speaker—the interventions may support the necessity—that it would be appropriate to explain the background to the thinking behind this short amendment. As the House will be aware, on Second Reading, it was explained that the Bill in effect stops the programmed and vastly expensive national revaluation of every home in England to place them within council tax bands. It also gives the Secretary of State, whoever that may be at the time, the power to call for a national revaluation when he or she deems it appropriate, if ever. The whole discussion on revaluation for council tax purposes was questioned during the run-up to the election. Many felt that there was no requirement for a revaluation, and my Conservative colleagues and I numbered in that group.
Because we do not have the Act that the Bill will amend before us, it is very difficult to follow even my hon. Friend's lucid argument. Clause 1 states:
"A new list must be compiled, in relation to billing authorities".
What is that new list? Is it a list of people liable to pay the council tax, or a list of properties, or a list of billing authorities? What is the list that the amendment addresses?
I should perhaps have explained that, but I was aware that in doing so I might transgress a little beyond the amendment. The new list is a list of valuations of properties within a billing authority, so that they may be put in bands for the redistribution of grant, on the basis of ability to pay, and to determine the amount collected in council tax from the owners of the properties within the billing authority's boundaries. The Government, especially the right hon. Member for Greenwich and Woolwich (Mr. Raynsford), were emphatic that a national revaluation was required and that, as it was programmed, it should go ahead. Suddenly, post the election—
Order. The hon. Gentleman said that he wanted to give a brief explanation. I was prepared to allow that, but I will not have another debate effectively on Second Reading. Perhaps just giving a brief background to the amendment will be appropriate.
On a point of order, Madam Deputy Speaker. Would you not perhaps concede that a degree of flexibility would be helpful, given that we are struggling, as my hon. Friend the Member for Grantham and Stamford (Mr. Davies) has pointed out, because we do not have the originating statute in front of us? Would it not be more appropriate than normal for my hon. Friend the Member for Mole Valley (Sir Paul Beresford) and perhaps other hon. Members to give more of the background to the amendment and, indeed, to clause 1, given the absence of the originating statute? Would that not be helpful to the House, Madam Deputy Speaker?
I am afraid that I disagree with the right hon. Gentleman, because he is a very experienced Member and really does not struggle at all.
Further to that point of order, Madam Deputy Speaker. I am a slightly less experienced Member than my right hon. Friend and I probably know much less about local government finance, but I am trying to make a conscientious effort to participate in the discussion of this matter, which could be important to my constituents. We cannot follow the amendments because we do not have the text of the Act that is being amended. So we depend particularly on the acknowledged expertise of my hon. Friend the Member for Mole Valley (Sir Paul Beresford) to explain the background to and, therefore, the rationale of the amendment to the Government's proposals to amend an Act that we do not have before us. It would be most helpful to hon. Members in my position if he could be given a little latitude in explaining the background to both the Government's proposed amendments to the Act and his proposed amendment to the Government's amendment to the Act.
I do not accept that point of order. The hon. Member for Mole Valley (Sir Paul Beresford) has been given an opportunity to give a brief explanation of the background to the amendment. The hon. Member for Grantham and Stamford (Mr. Davies) may not be quite as experienced as the right hon. Member for Bromley and Chislehurst (Mr. Forth), but I am quite sure that he is more than capable of following the debate. The Minister may be able to elucidate a little when he replies.
Thank you, Madam Deputy Speaker.
The Bill relates to a national revaluation, and as I have tried to set out, there is an opportunity for a smaller or minor revaluation in appropriate areas. Interestingly, my right hon. Friend the Member for Skipton and Ripon and I are ex-local government Ministers and we have some knowledge of the matter. On Second Reading, I asked the Minister of Communities and Local Government to confirm whether the
"Bill effectively puts revaluation in limbo, and there might be no revaluation in future if there is a rethink on the grant formula".
The Minister, in effect, confirmed that by saying that the Bill was in keeping with a situation where the Government were leaving their options open and that
"all options remain open in the future."—[Official Report, 7 November 2005; Vol. 439, c. 34.]
So such a revaluation is conceivable. That caused a bit of a flutter in the dovecotes for the right hon. Member for Greenwich and Woolwich—whom I expected to be here today but he is not—because he felt compelled to back his previous position. The hon. Member for South Ribble (Mr. Borrow), who spoke as an ex-valuer, probably felt a little like a turkey at this time of the year—if not more frequently.
Valuation for council tax is different from valuation for rates and business rates in that it essentially serves two purposes. First, it serves a role in the funding formula, as it is used to give an estimate of the ability to pay. As I said on Second Reading, that could be done in different ways. Secondly, it is used to rank properties in valuation bands, thus enabling a billing authority to distribute its council tax charge. As long as that proportion of spread remains the same—generally, that seems to be so—there is no need for a revaluation, especially an expensive national revaluation. However, one can foresee occasions where a national revaluation may not be needed at all for some considerable time but a small local revaluation might be appropriate.
The example that most readily comes to mind is that the Government are following previous Conservative Governments in pushing for redevelopment on brownfield land—in particular, the Thames Gateway. It is well known that the Deputy Prime Minister wants to cover sections of the Thames Gateway with large numbers of new—
Order. Once again, the hon. Gentleman is straying very wide of the amendment, which is narrow in scope. I have given some latitude; I now expect him to adhere to the amendment.
On a point of order, Madam Deputy Speaker. I am sorry to raise this issue. I have been carefully following my hon. Friend the Member for Mole Valley (Sir Paul Beresford). One of the difficulties with the amendment is understanding where it would be applicable, but it seems that he cannot refer to those places. This is the first time that I have been following this bit of the argument. May I ask you kindly to allow him to refer to some of those places, so that we can judge whether the amendment is a good one?
I remind the right hon. Gentleman that he is not chairing the debate—I am—and I have made a ruling.
Thank you, Madam Deputy Speaker. I am trying to set out exactly such an example, but perhaps I strayed a little far in pointing out a particular area.
It is conceivable that an area could have a large number of new properties, the valuation of which would be set by their sale price, but that would distort the gradation and, therefore, the proportional spread across the council tax bands of the rest of the authorities in that billing authority's area or the area covered by a group of billing authorities.
If I understand the spirit of the amendment correctly, it would essentially allow a localised revaluation, as opposed to a one-size-fits-all national revaluation process. New clause 1 was not selected for debate—in no way do I seek to challenge the decisions on the groupings—but, in spirit, it would have allowed both a top-down power, whereby the Secretary of State could order a revaluation, and a bottom-up request, whereby a group of authorities could come together to seek the Secretary of State's authorisation of such a revaluation. My hon. Friend may be about to cover that anyway, but will he make it clear whether he believes that amendment No. 3, which is much briefer, would work in both ways and that the bottom-up, as well as the top-down power, should exist?
I admit that my right hon. Friend the Member for Skipton and Ripon and I tabled new clause 1, but we realised in retrospect that it could have been ruled slightly out of order. If my hon. Friend looks carefully, he will see that the drive of that new clause is, in effect, contained in this much simplified amendment. In fact, the effect is still there.
I am afraid that my hon. Friend is not making much headway with me, because I have reached the conclusion that his drafting is defective. The amendment refers to
"a group of adjoining billing authorities".
Why must they be adjoining? Would not a better phrase have been "a group of comparable billing authorities"? City centre property values may well rise and a view may be taken that urban authorities, not county authorities, should carry out a revaluation, yet under his wording, they would have to be adjoining billing authorities, not comparable ones.
Perhaps that explains why the opportunity to give a broader explanation would have been helpful, because the situation that my right hon. Friend mentions is covered by the amendment, as he will see if he looks very carefully. The amendment covers an individual authority or lots of authorities. I specifically picked the term "adjoining authorities" because I chose as an example—I shall be ruled out of order if I continue with it—the Thames Gateway, which includes a number of authorities to which such circumstances might apply. Given that they are adjoining, it would be appropriate to carry out a revaluation at the same time.
I have an interest in that my constituency has suffered the biggest ever increase in council tax. Who would decide whether a group of neighbouring authorities had to revalue?
The Secretary of State would decide. My hon. Friend needs to recognise that if the ability-to-pay assessment in the funding formula were changed—as I mentioned earlier, before I ran the risk of being ruled out of order—the readjustment in a billing authority or in a group of billing authorities would make no difference to the council tax for those properties, unless the local authority's sum council tax bill for the whole billing authority increased.
I refer my hon. Friend back to what he said about the phrase
"a group of adjoining billing authorities"
in amendment No. 3. Is not the word "adjoining" redundant? If the amendment referred simply to a "group of billing authorities", it could cover a group of adjoining authorities, if necessary, and, as my right hon. Friend the Member for East Yorkshire (Mr. Knight) suggested, a group of authorities that, by virtue of the fluctuation of the country's real estate values, found themselves in the same position regarding the movement of average values, and should thus be grouped for the purpose of a special revaluation? Would it not be helpful for the purposes of the amendment if—
Order. Interventions are to be brief.
I think that the answer to my hon. Friend's question is that I was attempting to make the amendment sufficient, but succinct.
I, too, have followed closely the logic of the hon. Gentleman's exposition of the amendment. I understand that if the Local Government Finance Act 1992 were to remain in place, there would be a guaranteed revaluation. Indeed, his party's position coming into the debate was that it wanted the provision for a guaranteed revaluation to stay in place because that was what they voted for. Is it the case that amendment No. 3 would mean that the position relative to the 1992 Act would change, so it would be an addendum to a Bill that he would then happily support, or does he want it to replace the position in the Bill? Alternatively, does he want to change the policy adopted by his Front Bench for the debate?
I thank the hon. Gentleman for his complex twisting questions and red herrings. I think that he will accept that the Bill changes the situation by removing the programming of revaluation, but allowing the Secretary of State to set the timing for a revaluation—if that ever happens. I thus suggest that there might be an opportunity to save the enormous expense of national revaluation by having local revaluations, if that is appropriate. As the hon. Gentleman will be aware, given his interest in local government, the cry for a national revaluation is virtually nil.
Is not my hon. Friend being rather unkind to the hon. Member for Southampton, Test (Dr. Whitehead)? Is it not clear that the hon. Gentleman has misunderstood what has happened simply because his Government came into power saying that there would be a revaluation, but have now decided that there should not be one, which has left him confused?
My right hon. Friend is perhaps right. The hon. Member for Southampton, Test (Dr. Whitehead) gave a long dissertation on Second Reading and I think that it supported the assumption of my right hon. Friend.
I declare an interest as a member of Kettering borough council. I am trying to wrap my mind around my hon. Friend's amendment in the context of Kettering borough. Due to Government diktat, there will be 13,100 extra houses in the borough up to 2021, which will increase the local population by a third. Given that one of the consequences of council tax revaluation in Wales was a large increase in council tax bills, should residents in Kettering borough be worried that the Government might impose a revaluation—
Order. I think that I might just protect the hon. Member for Mole Valley (Sir Paul Beresford) so that he does not stray on to Wales during the debate.
Bearing in mind my accent and recent sporting activities in Wales, that is probably a very good thing, Madam Deputy Speaker. I thank my hon. Friend for citing the sort of situation in which a local revaluation might be appropriate.
My hon. Friend argues the case for the law to be changed to permit individual or group revaluation instead of universal revaluation. The Government have already disgracefully spent £60 million on preparing for revaluation, although they now say that that might not happen. A general revaluation would be enormously expensive, so perhaps my hon. Friend can indicate how much that would cost. What would be the cost of an individual revaluation for an average authority? Before we agree to allow individual authorities to be revalued, surely we should have an idea of the cost of such a revaluation that the taxpayer would be obliged to bear.
Unfortunately, I do not have the figures with me. However, I am sure that the Minister for Local Government, who is smiling at me, has them in his large portfolio and that he will produce them. Presumably, the cost of revaluation for an individual authority or a group of adjoining authorities would be proportionate to the expenditure for a national revaluation. However, I suspect that the Minister will find reasons why a local revaluation would be proportionately much more expensive, if he does not accept that the amendment is a genuinely positive move that, in a funny way, supports the Bill that he brought forward in the first place.
Some 80,000 homes will be built in Hertfordshire, mostly up in Stevenage, which is above my constituency. If my hon. Friend's amendment were accepted, would it be possible for my district to opt out of the grouping for a revaluation, or would it be linked with the revaluation because of the vast number of new homes in Stevenage?
I am worried that as many hon. Members are citing areas in which they want revaluation, they seem to be supporting the view of the hon. Member for Southampton, Test that we might need to have a national one. Fortunately, there are a few hundred Members to go.
I have had ample assistance in explaining why it is necessary to make this small amendment to the Bill. I suspect, however, that the Minister will not accept it, although it would give us the opportunity, in a funny way, to support both the Bill and the reasoned amendment moved by my hon. Friend the Member for Brentwood and Ongar (Mr. Pickles) on Second Reading. I say that with a touch of concern because when my hon. Friend the Member for Poole (Mr. Syms) made his winding-up speech on behalf of the Opposition on Second Reading, he said that he felt that my right hon. Friend the Member for Skipton and Ripon and I were not following the party line. Perhaps I can persuade him to follow the proper line rather than necessarily the party line in this particular case. That might even tempt the Minister to accept at least the drive of the amendment.
If the Minister gives the matter careful thought, he will realise that the amendment could be useful. It would have been useful if such a provision had been included in the Bill, but I suspect that he rejected that opportunity, if it had even occurred to him, because it would have looked as if he were going for no national revaluation—at least not for a considerable time—which would have made his predecessor, the right hon. Member for Greenwich and Woolwich, who sat behind him on Second Reading, really upset, instead of just mildly upset.
On a point of order, Madam Deputy Speaker. I left the Chamber a moment ago—I apologise for such discourtesy to my hon. Friend the Member for Mole Valley and hope that I missed only a small number of sentences of his speech—to find out whether I could now get a copy of the Local Government Finance Act 1992. Staff of the Vote Office tell me that the Act will not be with them for at least an hour and a quarter, so we will have had about two hours of a debate on an amendment to a Bill that refers to a text that we cannot see. Is that your feeling of how the business of Parliament should be conducted, Madam Deputy Speaker? If it is not, may we accelerate the production of the text, or else suspend the sitting until the text is available?
The hon. Gentleman was in the Chamber when Mr. Speaker made his ruling about the urgency of getting the papers into the Vote Office. That happened little more than half an hour ago. I think that we can proceed with the debate, and I will be informed as soon as the papers are in the Vote Office.
Further to that point of order, Madam Deputy Speaker. When the Speaker made those points, it occurred to most of us that we were talking about a shorter period than two hours. Can you make sure that the Speaker himself knows that it is taking two hours for us to receive the text? The Speaker's words and their tone suggested to most of us that it would be a matter of a few minutes, or perhaps half an hour. May he please be informed of the matter?
My intention, which I hope will satisfy hon. Members, is to make further inquiries into precisely how long we might have to wait. In the meantime, we can proceed with the debate.
Further to that point of order, Madam Deputy Speaker. Perhaps you will help by allowing my hon. Friend the Member for Mole Valley (Sir Paul Beresford) sufficient flexibility to expand his remarks for about two hours, so that he could give us the benefit of his wisdom and we could postpone our contributions until we had the appropriate documents in our hands.
Perhaps I will not be minded to do that.
On a point of order, Madam Deputy Speaker. I wish to put on the record the fact that the situation is more serious than you may realise. I went to the Vote Office today to ask for a copy of the Act and was told that it was not available, but I also went to the Vote Office yesterday and said that I wanted a copy of the Act before this debate commenced; I was assured that it would be available. A request for a copy of the legislation has been in force for more than 24 hours, yet we still do not have a copy of it.
I have already said that I shall make further inquires into how soon the necessary papers will be in the Vote Office.
I do not intend to take any further points of order on that issue.
On a separate point of order, Madam Deputy Speaker. Leaving aside entirely the shambles of not having the Act today, is there not an important issue to be dealt with if this is not to set a precedent for the future conduct of Parliament's business? Will you make a ruling that in future the Government must make sure that all the relevant documentation is available to Parliament at least 24 hours before the debate begins, not two-and-a-half hours afterwards?
That is a matter for the Government. Members of the Government are present and will have heard the hon. Gentleman's remarks.
For a moment, I feared that the carefully thought out suggestion offered by my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth)—that I speak for another two hours—would become a request from the Chair. One of the difficulties caused by my national background is that, like my previous countrymen, I tend to make speeches that are short and sweet.
I am relieved and pleased to see so many of my hon. Friends here to support my amendment—at least I hope that that is why they are here. I commend the amendment to the House.
This is an interesting debate on an important amendment. The basic architecture of the Bill would put off revaluation. There is little difference between the Opposition and the Government on that. We think that postponement is a good thing because there is widespread concern about the revaluation originally set down in the Local Government Act 2003—the hon. Member for Southampton, Test (Dr. Whitehead) was wrong about that. The Government have had a genuine change of heart on proceeding with revaluation and referred the matter to the Lyons review.
I apologise for interrupting my hon. Friend, but he referred to the Local Government Act 2003, which is mentioned in clause 1(7) of the Bill. Is a copy of the 2003 Act available in the House this afternoon?
I am sure that the authorities have heard my hon. Friend's question. No doubt he read that legislation when it was discussed in 2003, as he was a Member at that time.
As my hon. Friend says, the Government's U-turn on revaluation in response to the arguments that we have advanced for the past year or so is welcome, but must not they still account for the money spent—misspent, rather—on the preparations—
Order. Perhaps the hon. Member for Poole (Mr. Syms) will speak to the amendment.
Thank you for your protection, Madam Deputy Speaker.
Amendment No. 3 is simple, but there is a debate to be had on whether the revaluation should be national—for the whole of England—or whether it can be done bit by bit. The amendment states that
"an order . . . may be made in relation to an individual billing authority, a group of adjoining billing authorities or all billing authorities."
That seems to leave open several policy options. The Secretary of State may lay before both Houses an order for a national revaluation. Subject to the outcome of the Lyons review, I suspect that the Government will do that at some point.
The second option under the amendment moved by my hon. Friend the Member for Mole Valley (Sir Paul Beresford), who is an acknowledged expert on local government, is to do something less than a national revaluation. Within the terms of the amendment, there are several options available in that respect. A regional revaluation would be possible—as we discussed in the Committee, house prices change nationally, regionally and sub-regionally—so that revaluation took place bit by bit. In effect, we have already had a regional revaluation in Wales. Some of the concerns expressed by my hon. Friends arise from the consequences of that revaluation. Revaluation county by county would also be possible: in a large county such as Hampshire, one could get the agreement of all the billing authorities—the districts and boroughs—and produce a revaluation on that basis. It would also be possible on the micro-level, with revaluation only within a district or borough area.
Implicit in the amendment are major policy decisions on how to proceed, because council tax is one part of a jigsaw comprising council tax, unified business rate and the Government grant structure. Historically, both Conservative and Labour Governments have set a grant structure once they know what local billing authorities are collecting through council tax and the unified business rate, and various forms of redistribution go on. Members are often unhappy with the grant their area gets from central Government—it is a common theme. I have never heard an hon. Member say, "My local authority has more than sufficient grant," and it has been argued that the way in which grant is distributed ought to be revisited. A national revaluation, as the Government propose, leaves open the possibility of moving resources between regions and councils, which makes it the logical thing to do from a national policy perspective. My concern about the amendment is that revaluing bit by bit will prevent us from seeing the national picture and making judgments on needs and on particular areas.
Will my hon. Friend give way?
Yes, of course.
Order. Perhaps the hon. Gentlemen will not mind my intervening to inform the House that the necessary document is now in the Vote Office. It has taken only slightly longer than the half hour that Members expected. There is a slight error, which is being corrected, but the document is now in the Vote Office.
Thank you, Madam Deputy Speaker. I give way to my hon. Friend.
I am beginning to wonder whether I should do as was suggested earlier and give my speech all over again, because that might enable my hon. Friend to follow my argument. As I understand it, the system of valuation, revaluation and council tax banding gives two results. First, there is a distribution ladder within the banding system for redistribution of council tax itself. Secondly, the system is used to assess the ability to pay. I made it clear on Second Reading and very briefly today, in case I got stopped, that that would have to change and that it could be changed into a much fairer system that used Treasury figures on earnings and income tax paid within the billing authority areas.
I am glad that my hon. Friend has explained that—even though he is straying somewhat from party policy—because it is useful to the debate on amendment No. 3.
A national revaluation enables the setting of national policy objectives on the redistribution of money. That becomes much more difficult if revaluation is conducted on a regional, sub-regional or local authority basis. My fear as one whose county is not treated well by the grant system is that local revaluation might freeze an unjust distribution of the revenue support grant, which is one of the main political elements of that system.
The hon. Gentleman is right. In my previous intervention I should have referred to section 77 of the Local Government Act 2003, which derived in part from the 1992 Act. The 2003 Act is the one that requires regular revaluations to take place, which was the position of his party at the end of Second Reading. Is he saying this afternoon that because he does not feel particularly warmly disposed towards the amendment tabled by the hon. Member for Mole Valley (Sir Paul Beresford), he is in favour of regular revaluations, as laid down by the Local Government Act 2003, or he is not in favour of regular revaluations, as stated in the amendment moved by his party on Second Reading, or would he be prepared to cling to the lifeboat offered by the hon. Member for Mole Valley, which proposes some form of revaluation, but not necessarily that set out in the 2003 Act?
I do not want to stray too far, not because I do not want to answer the hon. Gentleman, but because I want to discuss amendment No. 3. On Second Reading of the Local Government Act 2003 the Opposition moved a reasoned amendment. I sat on the Committee which considered that Bill, as did the hon. Gentleman, I think. We had concerns about various aspects of that Bill—we agreed with some parts but not with others. At present we do not see the need for a revaluation. That is why we broadly support what the Government are doing.
My hon. Friend is very patient. I would hate to shorten his speech, but one of the difficulties with his argument is that he does not recognise a lifeline when one is thrown to him and he is starting to blow bubbles from underwater. He ought to recognise my earlier point that the ability to pay is the second way in which the valuation and the spread of valuation is taken into account for the national distribution, under the Government's present formula. That would have to change, and it could easily be changed and improved, as I have already suggested three times this afternoon.
I thank my hon. Friend for putting that again on the record. The Lyons review is examining a range of issues, including banding and alternative ways of raising money via local government. The council tax as we know it may, therefore, not remain in its existing form in the future, particularly when we come to whatever date it may be for a future revaluation. The revaluation that we are putting off today was to have taken place in 2007. If we have a revaluation in 2010 or 2011, it may be with wholly different bands, they may be progressive, and there may be changes and amendments to the system. My hon. Friend would like further reform of the manner in which we raise money, and I understand that.
I draw the attention of the House to the fact that I am a chartered surveyor, a fellow of the Royal Institution of Chartered Surveyors and involved in practice in this matter. We now have a copy of the relevant Act that we are seeking to amend—the Local Government Finance Act 1992, and section 22B of that Act, as amended by section 77 of the Local Government Act 2003. There has been some comment in the House about that, so for the edification of the House I quote subsection (6) of section 22B, which states:
"Before a list"—
that is, a valuation list—
"is compiled under this section, the listing officer must take such steps as are reasonably practicable in the time available to ensure that it is accurately compiled on the date on which it is to be compiled."
There have been some comments in the press that entry into people's houses, photographs and other such intrusive measures could be contemplated in that exercise—
Order. I understood this to be an intervention.
Yes, indeed.
Interventions, as the hon. Gentleman knows, are to be brief. I hope he has now concluded. I call Mr. Syms.
My hon. Friend the Member for Cotswold (Mr. Clifton-Brown) is speaking about the widespread public concern about Government inspectors and I do not intend to comment on that subject, as I wish to speak about amendment No. 3.
The purpose of my long intervention was to say that such measures would increase the cost of such valuations. Does my hon. Friend agree?
There is no doubt that the cost of a national revaluation is a little under £200 million—£170 million or £180 million. I think the Government would acknowledge that. When my hon. Friend the Member for Mole Valley moved amendment No. 3, he said that one of the advantages would be that a revaluation could be done in smaller chunks by moving slowly throughout the country, doing particular regions, and there might be benefits in that. I accept that that might be true.
I thank my hon. Friend for taking another risk by giving way. In fact, that is not what I said. Although what he suggested is conceivable, there is an opportunity to delay or even stop national revaluations by carrying out revaluations only in those areas or billing authorities where it became a necessity because of the spread across the banding system.
That is an interesting argument. Given the various options that amendment No. 3 allows, how would that be actioned? Would it be by public consultation? Would the Member of Parliament need to have an Adjournment debate? Would the billing authority, having decided that things were seriously out of kilter in its area, have to petition Parliament to be a special case for revaluation purposes? I cannot see that happening, but I can see that the moment one moves from a national revaluation on a particular date to a local revaluation, that raises a number of questions such as in what order, when, which authorities are included, why a particular authority is included, the appeal structure, what happens when one area undergoes a rebanding process but an adjacent area does not. Would there be complaints from residents in that area?
Does my hon. Friend not find at least slightly attractive the idea of a small expert hit squad of valuers moving seamlessly round the country valuing each district or region, instead of some massive bureaucracy attempting to value everything at once? With the nip and tuck approach, that little squad could apply the same principles around the country.
That is a point. The Government acknowledged in Committee that putting off the revaluation meant that 1,250 people who worked for the Valuation Office Agency would have to be made redundant. Many of them are on short-term contracts. An issue raised on Second Reading was how—
Order. We are not on Second Reading, and we will not have a repeat debate on Second Reading. We are dealing with the amendment.
Thank you for your guidance, Madam Deputy Speaker. I was led astray.
Perhaps I can help my hon. Friend get back to the amendment. Does he accept that although this may not be the right amendment, the Government need to embrace the concept that we need a mechanism for going to specific areas where there is such great change that any alternative would be very much worse? Will he ask the Government to do precisely that—to take that element out of the amendment, so that it can be done?
My right hon. Friend makes a very good point. The difficulty is that if the current structure of council tax were settled, we could move away from a national revaluation, as the amendment suggests, and carry out regional or sub-regional revaluations, as we would still get similar bands A to H in each area. Under the Lyons review, the Government are considering alternatives, and—this is relevant to the amendment—they have the powers to vary the number of bands or make them more progressive, less progressive or whatever the Government want to do. If there was a partial revaluation in one area of the country on bands A to H, but at a later date the policy changed so there was different banding in a different area, that would cause immense debate in the House. Until we settle the form of local government finance and the manner in which it is introduced, we cannot move from the concept of a national revaluation to the concept of a local revaluation. The Government are right that the Lyons review needs to examine all the options and report on them.
If amendment No. 3 were drafted more cleverly, the Government might want to consider it. In that case, the Secretary of State would have to return to the House and lay orders for a national revaluation. Perhaps the Lyons review should examine the matter. When the Minister replies to this important, short and specific debate, perhaps he will say that the Lyons review should consider amendment No. 3 very carefully. There are major changes in relative values and house prices, and they may occur in particular areas rather than nationally.
We must consider a range of issues, and I understand the strength of feeling among my hon. Friends on the Back Benches. I have not made up my mind how I would vote on this one: my general instinct is to say, "No", but there are good reasons why the Government should throw the matter to the Lyons committee for further consideration. I shall listen to the rest of the debate, take into account hon. Members' points and advise my hon. Friend the Member for Mole Valley which way we would go, if he were to feel so strongly about the issue that he presses the amendment to obtain the opinion of the House.
There are two reasons why I shall be very brief. First, I am a late substitute for my hon. Friend the Member for Brent, East (Sarah Teather), who is sadly unwell. I hope that all hon. Members will join me in wishing her a speedy recovery. Secondly, I understand that there is some annoyance on this side of the House that we are taking this business rather than another debate today, which is a point that hon. Members raised at business questions. However, it strikes me that the protest would be more effective if we were to dispatch the business of the House without unnatural prolongation to demonstrate to the Government, as I said last Thursday, that we could have had both debates on the same day. I shall reiterate my party's position. We support the Bill and want to see revaluation stopped, for the simple reason that under the system of local government taxation that we would adopt—local income tax—no valuations or revaluations would be necessary in the first place.
On amendment No. 3, the hon. Member for Mole Valley (Sir Paul Beresford) has made a serious point. I agree with the hon. Member for Poole (Mr. Syms) that if we support the general idea of council tax, amendment No. 3 is an interesting idea that should be explored, and I hope that the Lyons committee will explore it. There is, however, a serious objection, which Conservative Members raised almost as soon as the hon. Member for Mole Valley rose to speak. As the amendment stands, the Secretary of State's power to order separate local or regional revaluations could be used in a politically biased way.
The hon. Member for Mole Valley has repeatedly raised another serious problem in the debates about the Bill—the connection between the council tax banding system and the grant that the Government hand out to particular local authorities. It would not be beyond the wit of the Government to use that connection to produce a politically interesting result, which has not been unknown in the past. In reply to that point, the hon. Member for Mole Valley said that he would institute a different system of calculating the grant. I was interested to hear him say that he would use a system based on income levels in various districts, which is the precise basis for equalisation under local income tax, and I urge him to go much further along that line of thinking.
The hon. Gentleman is being provocative, and I refer him to what I said on Second Reading. There is a distinct difference between my position and local income tax—the proposition advanced by the Liberal party is mindlessly complicated and includes all the problems of the poll tax, and more.
Order. I remind the hon. Gentleman that we are not discussing any other kind of tax; we are discussing amendment No. 3.
I was about to make the same point, Madam Deputy Speaker. I would be glad to debate the merits of local income tax on a different occasion, but we are discussing a particular amendment to a particular Bill, which is very narrow in its scope.
If we were to adopt the system proposed by the hon. Member for Mole Valley, because income is distributed more evenly than property values the equalisation system would be easier to manage and less difficult to make work. Nevertheless, the central objection to amendment No. 3 is that the system, which is a good idea, would not appear in the Bill. If amendment No. 3 were passed, it would make the Bill worse rather than better. I urge him not to press his amendment to a vote and, perhaps, to discuss the matter with his noble Friends in another place to allow the introduction of a different version of the amendment that deals with the problems raised in the course of the debate.
I congratulate my hon. Friend the Member for Mole Valley (Sir Paul Beresford) on tabling the amendment. I also declare an interest: as many hon. Members know, I am a county councillor. [Hon. Members: "Hear, hear."] Thank you very much. I am also the finance spokesman for Northamptonshire county council, which is currently battling a very difficult budget.
Let us get this out of the way, straight away—I believe that if we have a property tax, we must have a revaluation. I said that during the election and hope that I have not offended my hon. Friends on the Front Bench. That is my view and I have retained it. Amendment No. 3 is a way of ensuring revaluation, where local authorities think it necessary. Giving local authorities greater autonomy in that respect is a laudable objective.
If what my hon. Friend has just said were in the amendment, I could agree with him. On reflection, does he agree that as the amendment is drafted, the power to order a partial revaluation rests not with local authorities, but with the Secretary of State, who may seek to use it to punish a particular area for voting for another political party?
My right hon. Friend has made a valid comment, but I argue that amendment No. 3 would at least allow local authorities to appeal to the Secretary of State for a local revaluation, which would be a step forward from the current position. As for the Government's ability to distort the measure, that power ranges over a very wide area, if they were to choose to use it. It is up to this House to scrutinise their activity and make sure that the use of such powers does not stray too far from what most hon. Members consider to be decent and fair.
I thank my hon. Friend for supporting the amendment. In response to my right hon. Friend the Member for East Yorkshire (Mr. Knight), who is more paranoid and concerned than me and who is to my right in more ways than just geography, it is possible for the Government to change the funding system undercover and lay the blame on local government. However, it would be too open for the Government to distort the system in the way that he fears.
I understand that point and accept the dangers. However, I see the matter from a local government perspective, and I am sure that my hon. Friend does, too. On balance, it is in the interests of local authorities to take such action.
Turning to my other points, first, as I have said in this House and Westminster Hall, there is considerable uncertainty in local government that ranges from the revaluation being put off to the Lyons report. I therefore believe that we should give local authorities the opportunity to exercise at least some power, and I repeat the point that there is power in the ability to appeal to the Secretary of State. Unless we give local authorities some power in that respect, we will diminish them to the point where they become almost worthless. I want to increase, not decrease, their powers, and the amendment would achieve that.
Secondly, the degree of unfairness increases with every year that goes by when a revaluation does not take place. That must be so, because the need for revaluation is based on creating a fairness taking into account local changes. The amendment would enable local authorities to recognise those changes instead of being forced by a Government into a situation whereby unfairness increases. That would increase the value of local authorities in this respect.
Thirdly, there is no doubt that, by the very nature of the Government's decision on revaluation, local authorities will be increasingly under pressure with regard to appeals. My own local authority fears that as unfairness increases, so will appeals and complaints. Council tax payers put the whole issue of local taxation under considerable scrutiny as it becomes increasingly unfair. The amendment would give an outlet to local authorities in at least being seen to do something on behalf of their council tax payers.
My hon. Friend makes an important point about unfairness. Does he agree that unless there are regular revaluations the differential between new and old houses, with new houses being valued as soon as they are built and old houses not being valued until revaluation takes place, will become ever wider, creating great unfairness between different constituents within the same billing area?
That is exactly the point that I was trying to make, and I am grateful to my hon. Friend for supporting me. He is absolutely right.
The sustainable communities programme will lead to massive changes in certain areas, dramatically increasing the need for revaluation. The Government say that they are fully committed to that growth agenda. In the light of that, the ability of authorities to appeal to the Secretary of State for local revaluation has considerable relevance.
I am becoming increasingly worried about my hon. Friend's touching faith in the integrity of a mechanism of appeal to the Secretary of State. He may have more faith in Secretaries of State than I have had hitherto, but can he tell me, hand on heart, that he really believes that any Secretary of State would deal even-handedly and fairly with the appeals to which my hon. Friend attaches such touching faith?
Order. May I remind the hon. Gentleman to make his remarks relevant to the amendment, not just revaluation?
I understand and take your guidance, Madam Deputy Speaker. My point was that the amendment would enable local authorities in a growth situation to ask for their own revaluation, which would alleviate pressure on them. That has a relevant connection to the debate.
In response to my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth), no, I do not have that faith—
Order. I think that the hon. Gentleman's right hon. Friend might be leading him somewhat astray.
That certainly would not be for the first time, Madam Deputy Speaker, and I am grateful to you for pointing it out. Under your guidance, I shall ignore my right hon. Friend and continue with the points that I wish to make.
I want to refer to the comments of my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer), who is no longer in his place. He suggested that the Secretary of State might have too much power and asked whether he would be fair or could act politically. I simply repeat that this House is the scrutiny body in this respect, and I hope that it would act in that way. However, I understand my right hon. Friend's point.
Does my hon. Friend, with his huge experience of local government matters, agree that a Secretary of State does not actually have to use a power that he is given, but the mere threat of his having it could force some local authorities to carry out a revaluation?
As I understand it, local authorities could carry out a revaluation only if the Secretary of State agreed to it. I have faith in the goodness of humankind. I see good when I look at the Government Benches, and I hope that that will be repaid to me by the Minister when he winds up.
To sum up very quickly—
There is no need to do that.
Well, I wish to do so. Again, I refuse to take the advice of my right hon. Friend.
The amendment would be good for local government administration and for the perception of local government. It would place in its hands at least the opportunity to request revaluation where it thinks it fit and proper and I hope that the Secretary of State would respond in good part to such a request. The amendment would give local authorities greater autonomy and a greater field of action in this respect, and as a champion of local authorities I would be in favour of that.
Local government has always been a political football, but this particular issue has added to the intensity of the game. That is sad. The amendment would help to relieve that situation by giving local authorities a safety valve where growth, whether forced on them or otherwise, is such that there is a real need for action that is not a national need. I thank my hon. Friend the Member for Mole Valley for presenting it to the House.
I rise to make a few points about the amendment. It is a pleasure to follow my hon. Friend the Member for Northampton, South (Mr. Binley), who is in effect the chancellor of Northamptonshire in this context. I wish him good luck with the challenges that he faces.
On Report, we can debate only the amendments that are before the House. I have some reservations about the way in which amendment No. 3 is worded and shall try to explain the reason for my concern. I have some sympathy with what my hon. Friend the Member for Mole Valley (Sir Paul Beresford) is trying to achieve, but I think, in all sincerity, that he may have tripped himself up slightly. Let me refer to new clause 1(2) to illustrate my point. That would give the Secretary of State a top-down power to permit a localised revaluation, which is the spirit of what my hon. Friend is trying to achieve in the amendment, but would also allow for a bottom-up request to the Secretary of State to exercise that power. I am worried that the way in which amendment No. 3 is drafted could allow the Secretary of State to decide, for some arbitrary reason—
Order. Perhaps the hon. Gentleman could address the Chair.
I am sorry, Madam Deputy Speaker. I was looking at my hon. Friend the Member for Mole Valley to try to emphasise my point.
The Secretary of State could, for some arbitrary reason, decide to impose a revaluation on a local authority or group of local authorities that are adjoining rather than comparable—as my right hon. Friend the Member for East Yorkshire (Mr. Knight) pointed out—and there might be some suspicion that that was being done for an open, or perhaps less open, political reason. If there were two separate amendments—the first to make the same provision as amendment No. 3 and the second to provide that the power could be exercised only in response to a request from the bottom, so that it could be effected only when a group of local authorities had got together to make that request—I would have more sympathy with the aim of my hon. Friend the Member for Mole Valley. In those circumstances, the Secretary of State could grant a revaluation only when there was clear evidence that the local authority or authorities had made the request.
Does my hon. Friend have any concerns about pressures, for example, to provide land for development more quickly—perhaps every five years when we are considering a 10-year revaluation—which could mean even greater pressures on revaluation? If land and buildings are provided more quickly, the revaluations can be done more quickly. Clause 1 would allow for that.
My hon. Friend makes a good point, which I intended to raise because it is the second reason for my concern about the amendment.
I have reservations about the amendment's drafting because the power is too broad. I would be more inclined to support it if it were drawn so that revaluation could take place only when a request had been made from the bottom up—from the relevant authority or authorities. I hope that I have made my first worry clear.
My second concern relates to growth, which several hon. Members mentioned, including my right hon. Friend the Member for East Yorkshire and my hon. Friends the Members for Northampton, South and for St. Albans (Anne Main). I am a Thames Gateway Member of Parliament, but the point does not apply only to that area. Some of my hon. Friends have argued that an area of especially high growth might give the local authority an incentive to revalue. I understand the logic of that but it is no secret that, in some of the proposed high growth areas, there is much local resistance to the amount of house building that the Government want. That is true of parts of the Thames Gateway and I believe it to be true of the other growth areas that have been mentioned.
If we allowed local authorities to revalue specifically in those areas on the basis of growth, residents and council tax payers might feel that they were being doubly punished. Not only would they be asked to accept all the additional housing—to which many constituents and I are resistant—and the attendant pressures on infrastructure, which I do not need to repeat in case I stray out of order; all hon. Members are familiar with the arguments, but they would also get a revaluation thrown in. That is not likely to be popular with residents and council tax payers even if the local authority wanted a revaluation for understandable financial reasons. However, people just over the border of the development area would not have to accept so many houses, suffer the infrastructure pressures or get the revaluation thrown in.
My hon. Friend must take account of the point that, if the local authority does not increase its total tax take, the distribution in the area will be evened up only if the Government recognise that the way in which they assess ability to pay—based on valuation band spread—must be corrected and moved not towards local government, as the Liberal party suggests, but a Treasury assessment. The Treasury already conducts such assessments.
I understand my hon. Friend's point. I, too, served in local government, albeit not at the same senior level. My hon. Friend successfully led Wandsworth council in London. However, although I understand his technical point, I was making a more avowedly political point. We all know that the growth is controversial and a potential consequence is that people would get a revaluation thrown in on top. Those people are suffering enough.
I shall give way to my right hon. Friend first.
Will my hon. Friend consider the other side of the argument? If the people who live near the new development feel that they are unfairly taxed because of the change, would not revaluation on a local basis have the opposite effect to that which he adduces? The revaluation would make them happier because it would be fairer not only to the new people but to them.
I understand my right hon. Friend's point, but if one considers, for example, the experience in Wales, revaluation has been relatively unpopular. If one could guarantee that the bulk of the people in a growth area would be pleased to be revalued, his argument would carry more weight. However, I believe that they would be happy to be revalued in isolation when people who lived nearby did not have to accept the additional houses and the attendant pressures or revaluation. I hope that I can deal with that matter in more detail if I am lucky enough to catch your eye on Third Reading, Madam Deputy Speaker. I understand the constraints on the current debate.
The overall problem is with the inequitable nature of the funding formula whereby so much local government money derives from the Treasury. I shall not go further but changing the formula and making it more equitable, not accepting the amendment, is the way to deal with that.
Does my hon. Friend the Member for Northampton, South want to intervene now?
No, my hon. Friend has now covered the point that I wanted to make and I thank him.
In that case, I shall conclude my remarks.
My hon. Friend is an expert on the matters that we are considering. He served on the Committee that considered the Local Government Act 2003. He knows that, when tax is raised by revaluation, the system already provides for redistribution to transfer money from higher-based to lower-based authorities. Would not accepting the amendment create a genuine incentive for that to happen?
My hon. Friend and I both served on that Committee and I greatly enjoyed the debates. I genuinely understand the aim of my hon. Friend the Member for Mole Valley in amendment No. 3, but the way to tackle the problem is by dealing with the inequity of the funding formula in the round. That is the nub of the problem. I hope that we shall take that on instead of accepting the amendment, which simply tweaks a much larger problem.
I understand what the amendment tries to achieve. If two separate amendments along the lines of the subsections in new clause 1 had been tabled, I might have been tempted to vote for one but not the other. Unfortunately, I am worried about supporting the amendment as drafted because the power is too broad and the Secretary of State could abuse it in certain circumstances.
I support amendment No. 3, which was tabled by my former colleague on Wandsworth council, my hon. Friend the Member for Mole Valley (Sir Paul Beresford). It is an ingenious amendment, which introduces flexibility and could go a long way towards dealing with the problem of perceived and actual unfairness in specific local authority areas.
I should like to show what the amendment could do in the case of the two billing authorities in my constituency, Christchurch and East Dorset. Those local authorities have experienced much higher than average increases in council tax per dwelling since 1993. A much higher than average percentage of people who are 65 and over live there. There is therefore probably a strong case for considering revaluation to get a fairer distribution of the burden within those local authority areas without affecting the overall grant distribution mechanism.
Before my hon. Friend becomes too enthusiastic, does he agree that the original wording in the Bill makes it clear that the Secretary of State will take the action? Sadly, all the amendment would do is allow the Secretary of State to use his discretion in determining whether action should be taken locally or regionally. Why does my hon. Friend, even in the early stages of his remarks, appear to imply that we should be hopeful that the anomalies, which he is about to describe in some detail, could be corrected by the Secretary of State, of all people?
I think that the anomalies could be corrected by a Secretary of State of a Conservative hue. That is why I think that there is some merit in the amendment. I accept the reservation articulated by my right hon. Friend and others who think that such a power given to the current Secretary of State would indeed be abused. There is some evidence that the Secretary of State's capping powers have been abused and used to bear down unfairly on small Conservative-run local authorities.
To drive the point home again, the reservations of some of us, to draw another parallel, are based on some of the planning decisions made by the First Secretary of Sate. I know that we are not debating planning this afternoon, Madam Deputy Speaker, but on a number of occasions local inquiries have found one way and the First Secretary of State has overruled the decision of the local inspector. Real practical examples therefore exist of the Secretary of State going beyond the merits of his powers. Those are additional reasons for our concerns.
My hon. Friend makes an excellent point. Of course, the First Secretary of State talks a lot about localism, but in reality he is in favour of centralisation. The amendment tabled by my hon. Friend the Member for Mole Valley would introduce a degree of localism into the process, and it would be useful for that reason.
I am not sure whether Members realise the extent to which average council tax per dwelling has increased since 1993–94. The Halifax has done some useful work on the subject, and the average council tax per dwelling in 1993–94 was £456, whereas this year it is £1,009. That is an increase of £553, or 121 per cent., when average net income has gone up by 82 per cent. That is an increase of about 50 per cent. more than the increase in average net incomes.
Does the hon. Gentleman accept that the Halifax survey, by its own admission, did not take into account the effect of council tax benefit and age-related payments?
Certainly. That does not undermine my argument, however, that the overall average council tax bill has increased by 121 per cent. since 1993–94, when the national average net income has increased by 82 per cent.
Does my hon. Friend agree that we knew that that would happen because it became clear from the Red Book that the Government intended to move a greater weight of local authorities' costs to the council tax, and then to blame the local council for the increase in tax?
Order. We are not discussing the clarity of local government finance.
My right hon. Friend is right.
Beyond the Government's overall policy to increase the national burden of council tax faster than the rate at which national incomes have increased, the situation is much worse in some local authority areas and the amendment might address that. For example, in my constituency, under the Christchurch borough council billing authority, in 1993–94, the average council tax per dwelling was below the national average at £441 per dwelling. This year, however, it is £1,193 per dwelling—an increase in the average bill of 171 per cent., which is 50 per cent. more than the England average. To take up the Minister's point that that does not take account of council tax benefit, the amount of council tax benefit in Christchurch is very small, with only 16.2 per cent. of households receiving it. We know, however, that more than 30 per cent. of the population are aged 65 and over. It is a privilege to be one of the younger people living in Christchurch. I am conscious of the burden faced by pensioners and those on fixed incomes.
The situation is similar under East Dorset district council billing authority, which covers another part of my constituency. There, in 1993–94, the average council tax per dwelling was £516, significantly above the then national average, but it has continued to increase, going up by 163 per cent. since then, and is now no less than £1,356 per dwelling. That is about £350 more per dwelling than the national average. It is not surprising, therefore, that my constituents come to see me frequently to complain about the actual and perceived unfairness of the council.
What would my hon. Friend's constituents say if amendment No. 3 were incorporated into the Bill and became law, and the Secretary of State made an order that one of my hon. Friend's billing authorities should revalue, but not the other?
My constituents would be angry with the Government for using such perverse reasoning. My right hon. Friend identifies what I see as a weakness in the amendment, but it is not such a weakness that we should not support it today. The amendment demonstrates some lateral thinking about how to try to introduce greater fairness into the system, rather than leaving things drifting under this Government. The prospects are that council tax will continue to increase way beyond the rate of inflation, and will increase by a higher rate in small district council areas such as Christchurch and East Dorset than in the metropolitan, urban areas that used to be regarded as Labour heartlands.
There is a problem, and I am not saying that the amendment is the perfect solution to it, but it contains the prospect of introducing some increased fairness. A revaluation in Christchurch or East Dorset would show which houses had increased in value by more than the average for the area, and which had increased by a lower proportion. The bills that were issued could then be adjusted to reflect that new equity. That should be a zero sum game within each local authority area, because otherwise we would end up having to pay much higher bills because of the redistributive effects of the national grant system. Provided that it was a zero sum game, such a measure might have a role to play within an individual local authority area. The Secretary of State might decide which local authorities to include, but he might also want to start off by saying that the pensioners are really the ones complaining most about the unfair burden of council tax, and that, therefore, in all local authority billing areas where the proportion of the population aged 65 and over is higher than, say, 25 per cent., there should be revaluation to see whether the burden on pensioner households could be reduced.
At the moment, the council tax is essentially a stealth wealth tax, and the value of properties is being used as a proxy for ability to pay. We know jolly well that the ability to pay of many pensioner households is very small.
I accept that what the hon. Gentleman says is true in part, but one problem with his argument is that about a quarter of households that pay council tax—those in council housing, housing association housing or private rented accommodation—do not own the property on which the tax is calculated. To that extent, therefore, it is not a wealth tax.
Order. I think we are straying a little wide of the amendment.
I accept that council tax is not wholly a wealth tax, but it is being used as one by the Government, which is one reason why we were so strongly against—
Order. I hope that the hon. Gentleman will relate his remarks to the amendment.
I shall certainly go back to the argument that I was deploying, Madam Deputy Speaker.
Another criterion that the Government could use when deciding in which billing authorities a revaluation should be held could be the percentage of households receiving council tax benefit. When I was a Minister in the then Department of the Environment, one of the Treasury's biggest concerns was the increased bills that resulted from high rates. The Government could decide to hold a revaluation in areas where the percentage of take-up of council tax benefit was relatively low. In Christchurch and in East Dorset, council tax benefit is available to far fewer households than it is nationally, and in East Devon the figure is only 13.7 per cent.
As my hon. Friend has so far mentioned only pensioners and people in receipt of council tax benefit, is he suggesting that, as part of the revaluation process, we should look more at the occupants of the property than the property itself?
I am illustrating a possible criterion upon which the Government might choose to exercise their discretion under the amendment. Does not my hon. Friend agree that the burden on pensioners is particularly great? Indeed, the Halifax paper pointed out that the burden of council tax had risen most among the pensioner population.
There may be many elderly pensioners suffering in that way in my hon. Friend's constituency, as there are in mine, but they often occupy larger homes than they need and cannot afford to downsize, so they could be disproportionately disadvantaged in a revaluation.
That remains to be seen. As I said, it would be a zero-sum game. In my constituency, more modern bungalows, where people moved in more recently, or bungalows that have been modernised and extended would probably rise in value relative to properties occupied by more senior pensioners—people in their 80s and 90s, of whom we have a large number in Christchurch.
May I slightly disagree with my hon. Friend? The whole point of the driver that I am proposing is that there would be revaluation where a change in the value of properties in a billing area needed to be reflected. He is drifting on to a point that I covered on Second Reading: rather than using valuation, there is a fairer way to redistribute council grant. That would cover what he seeks.
I shall not refer to Second Reading, Madam Deputy Speaker, as it is a verboten subject, but I am sorry that my hon. Friend thinks that my support for his amendment is misplaced. It gives one the opportunity to point out just how unjust the present system is and how unfairly it impinges on particular billing areas and councils and particular groups of people in those areas.
The other part of my hon. Friend's amendment has great virtue, as it would enable the revaluation process to be carried out incrementally—if it has to be carried out at all. Having studied the Valuation Office Agency report, I was horrified, as it shows that an enormous number of staff were taken on for the national revaluation and, despite the fact that the Government have said that there will be no national revaluation during the lifetime of this Parliament, a large number of those extra staff are still in post, because the VOA has a no-redundancy policy.
The Minister is grimacing, but I can illustrate what I said by reference to figures from the VOA annual report and accounts for 2004–05. On page 29, the VOA crows about the fact that it has taken 1,200 extra staff to deal with the national revaluation, yet the Minister told the Standing Committee, that as a result of the Government's decision not to go ahead with the revaluation, there had been a number of redundancies. However, the number fell far short of the 1,200 extra staff taken on during the last financial year. He said:
"The immediate impact is that some 420 staff working on casual and fixed-term contracts will leave the agency by this Friday."
I think that was the Friday before last. He continued:
"The agency is also running an early departure scheme for permanent employees"—[Official Report, Standing Committee A, 15 November 2005; c. 24.]—
Order. Will the hon. Gentleman help me by indicating how that relates to amendment No. 3?
It would be the consequence of having a national revaluation in one big chunk. Amendment No. 3 would give the Government scope to carry out revaluation in bite-size chunks, which would mean that the VOA did not need to employ so many staff, as those working on a valuation in one year could move on to another one in the next year. That is what happened in Wales. Some of the VOA staff employed for the revaluation in Wales were redeployed to deal with the start of revaluation in England.
I am illustrating the consequence of the peaks and troughs in demand for VOA staff necessitated by a national revaluation. Those peaks and troughs could be ironed out if revaluation was in bite-size chunks. I am trying to illustrate the benefits of the amendment by drawing attention to the costs, which are on the public record—how much the Government have wasted by moving from what was to be a national revaluation to no valuation at all. They took on extra staff and are keeping many of them on, doing I know not what.
My hon. Friend pre-empts something of what I thought I might explore myself. I have a similar reference, which I may cite should I catch your eye, Madam Deputy Speaker. Has he any feel for the relative costs of the national structure—buildings, staff and so on—on the one hand, which would be required by a national valuation approach, as opposed to a more transient, small, mobile force that could move around the country, on a local or regional basis, as he described? We might be able to tempt the House to vote for the amendment of our hon. Friend the Member for Mole Valley (Sir Paul Beresford) if we could demonstrate that benefit.
My right hon. Friend makes a good point but unfortunately I have no figures to illustrate it. All I can do is to illustrate the costs of a national scheme with its inherent inflexibility. As I understand it, despite the fact that that role has been withdrawn from the VOA, the Minister said in Committee that 600 staff would leave the agency between 30 March and 30 June 2006. What are those 1,200 staff doing in the meantime? Why were they not made redundant immediately, given that the function that they performed was removed? The Minister may feel for the families and the employees—
Order. The hon. Gentleman's concern has been noted, but that is sufficient.
I am grateful, Madam Deputy Speaker. I am sure that you are right that the House has noted our concern about the plight of people who are seduced into jobs that they believe to be long-term only to find that that is not the case.
Order. I remind the hon. Gentleman that we have heard sufficient on that particular point. He may now continue with his remarks.
Certainly, Madam Deputy Speaker. My hon. Friend's amendment would require a much smaller cohort of staff who, as my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) said, could be sent around the country at the behest of the Government to carry out a rolling valuation. The amendment has two great virtues. It is not perfect, but it is much better than nothing, and it demonstrates the imagination that Conservatives bring to the subject, given our constituents' frustration with the fact that the Government insist on maintaining an unfair system that penalises many of them.
You will be aware, Madam Deputy Speaker, that I raised my concern at the outset about the absence of a copy of the Local Government Finance Act 1992. May I place on record my gratitude to you, the Speaker, the Clerks of the House and everyone involved in producing that document? In the past few minutes I have received a hot copy fresh off the photocopier. It is nearly 2 in thick, and consists of more than 200 pages, so I do not know how I am supposed to digest it while addressing the House. I believe that the Speaker will support my view that that must never be allowed to happen again.
I appreciate my right hon. Friend's frustration. Even though his ability to digest material his legendary, he may wish to concentrate on the provisions in the Act that are explicitly referred to in the Bill and the amendment. I have done a little work on that, and I hope to help the House with the fruits of my labour later. If my right hon. Friend concentrated on section 22 of the Act, referring to section 21 on which it rests, that would naturally lead him to the amendment and the Bill itself. My right hon. Friend need not be alarmed—
Order. The right hon. Member for East Yorkshire (Mr. Knight) has had sufficient help.
I thank my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) for his advice, and I shall peruse the Act in greater detail as we proceed. However, given that I asked for a copy yesterday, it is not satisfactory to have to mug up and refresh my memory of an Act of Parliament that I helped to steer through the House as a Whip.
I pay tribute to my hon. Friend the Member for Mole Valley (Sir Paul Beresford) for initiating this debate. Whatever one's view of the sloppy drafting of his amendment, this is an important debate. There are merits in the broad principle of his amendment, because it has often been impossible for Governments to conduct national revaluations. The revaluation scheduled for 1938 was deferred for two years, but the second world war broke out, so it never took place. A revaluation was scheduled for 1952, but it was deferred until 1953, and was eventually carried out in 1956. A revaluation was scheduled for 1961 under a Conservative Government, but it was deferred until 1963. The Labour Government that followed deferred the 1968 revaluation.—[Interruption.] Indeed, that Government did not carry out a revaluation at all, and it was Edward Heath's Conservative Government who carried out a revaluation in 1973. Throughout our history, therefore, there have been occasional problems with getting national revaluations off the ground. If we cannot undertake a national revaluation we should consider whether it is worth undertaking a regional or partial revaluation.
I therefore do not oppose the principle behind my hon. Friend's amendment but, given its poor drafting, I am afraid that I cannot support him. I have explained why in my interventions. A politically motivated or malevolent Secretary of State, for example, may decide to make a blatant political order to carry out a revaluation of properties in areas that voted for another political party—perhaps the Conservatives or the Liberal Democrats—to teach the residents a lesson. My right hon. Friend the Member for Bromley and Chislehurst asked about judicial review, but I am not confident that such a review would work in those circumstances, because that Minister would be unlikely to say publicly that the basis of his decision was his wish to punish voters, even though that was the motivation behind his order.
The right hon. Gentleman is talking about a politically motivated or malevolent Secretary of State. He was the well-regarded MP for Derby, North when, for many years, the Conservative Government were politically motivated against my adjacent county of Leicestershire. Does he not agree that they were notorious for their politically motivated council funding?
You will stop me if I stray too far in responding to that question, Madam Deputy Speaker. I do not accept the hon. Gentleman's allegation. For a period, I was sponsor Minister of the city of Derby, and I did whatever I could, whenever I could, to bring more money and investment into the city.
Make no mistake that bullying takes place. Birmingham city council has removed one of the Government's precious bus lanes to reduce congestion, and the Secretary of State has threatened the council with loss of grant unless it reinstates that lane. Ministers do make threats to local authorities, so my concern is not exaggerated or far-fetched.
My hon. Friend the Member for Mole Valley described me as paranoid on this issue. I would put it this way: I am rightly concerned about corruption of power. Are we to pass a sloppily drafted amendment that gives a Secretary of State the unfettered right to make an order in any circumstances that he chooses? The amendment puts no limitations on the exercise of his power; nor does it say that he has to consider what has happened to property values or to population movement. I am deeply concerned that the provision could be used in an unfair way.
My right hon. Friend is making a serious statement and, more serious, it is now almost universally accepted that such pressure, such institutional corruption, is part and parcel of the means by which the Government operate.
I am making a serious point and I do not make it lightly. In the process of legislating, we should come to the Chamber to put our concerns on record. I have some sympathy with the principle behind the amendment, but because the House is not a debating society and because we are making legislation, I must tell my hon. Friend the Member for Mole Valley that I cannot support him if he pushes the amendment to a vote. I fear that, potentially, the amendment would give unbridled power to the Secretary of State, who might use it in a malicious way against certain local authorities.
Does my right hon. Friend agree that the other problem is that the amendment could be a means whereby the Secretary of State could cover up the fact that the real reason for the heavy cost of local government in particular areas was the manipulation of the grant, rather than the incidence of the council tax?
That is another of my concerns. Given the wording of the amendment, I am not satisfied with the phraseology that my hon. Friend has used. He says that the Secretary of State may make an
"order . . . in relation to an individual billing authority, a group of adjoining billing authorities".
I cannot grasp why my hon. Friend felt it necessary to use the words "adjoining billing authorities". If the amendment merely referred to a number of billing authorities and omitted "adjoining", I could understand that approach. As I said when I intervened on him earlier, the use of a limiting word in the amendment means that the Secretary of State may not be able to make orders for comparable billing authorities.
In my view, the drafting of the amendment is dangerously defective. For that reason, it cannot be supported.
From memory, I think that it was Lord Acton who said that power corrupts and that absolute power corrupts absolutely. Does my right hon. Friend agree that the problem with the amendment is that it does not give the Secretary of State absolute power, but gives him too much power? That is not counter-balanced by a requirement that a request for revaluation must be seen to have come from the local authority or authorities in question. Does my right hon. Friend share my concern?
My hon. Friend is right; I share his concerns. He has put his finger on the problem. If the amendment stated that an order may be made only where a billing authority has made the request, all my objections would disappear. It is as simple as that. It is a dangerous precedent if a Secretary of State can instigate a review without a local authority wanting it. That is why I cannot support the amendment.
I aim to be of assistance to the right hon. Gentleman. The amendment refers to "adjoining . . . authorities". It was pretty well known during the period of London government when the Conservative party was in power that particular favour was shown to what I believe are adjoining authorities, at one point at least, of Westminster and Wandsworth. Are we to allow for the possibility of that approach in future, with generosity and the distribution of largesse on the part of a Tory Government, should there ever be one in the first half of this new century?
In this debate I have left my political axe outside the Chamber. I would be against the amendment being put into the Bill even if we had a Conservative Government. It is our duty to build into legislation the checks and balances that prevent a Minister from any political party from abusing his position.
Perhaps I can help my right hon. Friend with the intervention of the hon. Member for North-West Leicestershire (David Taylor), which was geographically and factually wrong. In the distribution of council tax, the inner London area—Wandsworth and Westminster—regularly received the lowest or second lowest grants.
I am obliged to my hon. Friend for that intervention.
Does my right hon. Friend agree that the Office of the Deputy Prime Minister has undertaken a redistribution from struggling midland counties to northern counties that are in many respects better off in terms of local government grant, exactly as has been described?
Indeed—and the drafting of amendment No. 3 would allow the Deputy Prime Minister to pursue a regional policy. He could decide to order a revaluation in a whole region.
When considering whether we should allow a piecemeal approach, we should consider the wider issues of national planning. My hon. Friend the Member for Christchurch (Mr. Chope) made a good point in saying that staff costs could be blown out of all proportion when a national revaluation was deferred. I accept that that would not be a consideration if amendment No. 3 were passed, because the staff costs would be much lower, but I do wonder why those carrying out the task must be employees of the state. Why not involve the private sector? Why can the service not be bought for the period during which it is required? That, however, is a debate for another day.
Another defect of the amendment is that it does not provide for an appeal process. If the Secretary of State is to instigate the review and if it will not rely on a trigger from a local authority, the local authority ought at least to have a voice. It should at least be able to ask not to be made to undertake a revaluation as a billing authority, and to list its reasons for not wishing to undertake the revaluation. The Secretary of State should then be obliged to consider those reasons.
Far be it from me to be fair to the hon. Member for Mole Valley (Sir Paul Beresford), but I assume that he intended the order to be subject to parliamentary approval.
That is right.
My hon. Friend says, sotto voce, that that is right, but I am not reassured. That is not what I mean by an appeal process. We all know what would happen: a Secretary of State who made an order, perhaps for the wrong reasons, would simply whip members of his party to vote it through. We see that time and again. It is not an appeal process; it is what the late Lord Hailsham described as elective dictatorship, and I do not regard it as a satisfactory safeguard. If we are to accept the principle of amendment No. 3, we need a proper appeal process whereby the Secretary of State's decision can be challenged and he can be required to reveal why he has made the order. We have not yet reached amendment No. 4, but it at least requires the Secretary of State to
"give reasons for his decision".
Amendment No. 3 does not, and that is yet another area in which it is deficient.
My hon. Friend the Member for Mole Valley did the House a service by allowing us to debate this issue, but the wording of his amendment renders it a wholly unsatisfactory vehicle, and I hope that he will withdraw it. Someone asked earlier why we should not refer it to the Lyons committee, but I should prefer it to be withdrawn completely, and I should like a rethink to take place.
I too thank Mr. Speaker for ensuring that we were provided with the Local Government Finance Act 1992, on which the amendments rest. I hope that the House will never again have to debate without such information. I also hope that the cost of providing it, which must have been considerable, will be met not from the House of Commons appropriation but by the Minister, because it was incurred as a result of a change in the order of today's business. Governments should take seriously the cost of changes that are often made for not altogether wholesome reasons. I like to know that if people cause the cost, they pay the cost.
This is an important amendment and I came into the Chamber, what now seems like a long time ago, to support it—but the more I have heard the debate, the more I think that there are some key issues that need to be teased out. I hope that I can encourage the Minister to take the gravamen of the proposal seriously, even if he does not accept the format in which it is presented.
I agree with my right hon. Friend that this is an important debate—so does he share my disgust that at this moment in our proceedings, there is not one Labour Back Bencher, apart from a Parliamentary Private Secretary, in the Chamber?
I was not going to draw attention to that. It was so surprising that a matter of such importance to the future of local government had not attracted even one person with any interest in the subject from the Labour Benches, that I had almost forgotten how to say so in a polite manner. That is outrageous—unequalled, I would have thought. I cannot remember a local government debate of this nature in which the Government party has not had a single Back Bencher here. Perhaps they are all as confused as the one whom we heard from earlier—
Order. The right hon. Gentleman is a seasoned speaker in this House, and I think that he would now like to come to the amendment before us.
I quite agree, Mr. Deputy Speaker. As you will have noticed, I was meaning to go on without mentioning the absence of Government Members, but I was led astray by my right hon. Friend. May I suggest, however, that the debate has been extremely valuable, and that you have missed a great treat by not having been in the Chair for most of it? At stake is an issue of huge importance, concerning the complex way in which the local government impost relates to the central Government grant.
The difficulty that my hon. Friend the Member for Mole Valley (Sir Paul Beresford) has addressed in his amendment is the difficulty that anybody has in understanding why the council tax in his particular locality is what it is. Council tax is subject to three differing pressures, one of which my hon. Friend has tried to address. The first, of course, is what the Government decide is a suitable sum for that local authority to have in grant. The second is what the local authority decides is a suitable sum to raise in council tax. The third is the incidence of that council tax as spread over the whole area.
My hon. Friend talked about the Government's determination in the Bill. I agree with that determination, and I only wish that the Government had agreed with me on the hustings in my constituency, when I explained so clearly why a revaluation would be entirely wrong at that time. I was told by my opponent, who belonged—and, I think, still does belong—to the Labour party, that a valuation was essential. As a country councillor, he was determined to explain to me that I did not understand the issue, and why we had to have a valuation. Now I understand that it was not essential, and that despite being a county councillor, he was wrong. I only hope that the Minister has written to him to explain how foolish he was to have accepted that doctrine from the Labour party during the election campaign.
Now there will not be a revaluation for the foreseeable future. However, in certain specific parts of the country there will be significant, untoward, out-of-kilter changes for houses that have been built relatively recently. That will cause real local problems, for which the Minister has no remedy—and my hon. Friend the Member for Mole Valley has been trying to produce a remedy for him.
The right hon. Gentleman is of course a former Secretary of State and he knows what he is talking about. Does he agree that the valuation process, which has been postponed, is necessary if one is to have a property tax? Alternatively, does he agree with what I understand to be his party's policy, which is that no valuation is required?
One of the pleasures of being a Back Bencher is that one does not have to be too closely acquainted with the minutiae of the way in which a particular issue has been approached by whomsoever happens to be in charge of that area at a given time. [Laughter.] The Minister must therefore ask others whether I am in that sense in order or out of order; you, Mr. Deputy Speaker, will of course ensure that I am in order in the parliamentary sense. I simply say that if one is to have a property tax, one must have a valuation system. That seems obvious, and in saying so I do not think that I am falling out with anyone. There might be a question as to when one introduces such a system. We did not say that we should never have one; we said, rightly, that we should not have one in those circumstances.
The Minister can say all sorts of things but the truth is that, as we all know, we were right about this issue at the election, he was wrong and he has now come to our opinion. We are now going to discuss what difficulties even our earlier, right decision throw up. I am merely suggesting, from what I consider a non-partisan position, that the Minister needs some mechanism. We have to ask ourselves whether the mechanism suggested by my hon. Friend the Member for Mole Valley is the right one. If it is not, we must get the Minister to take that part of the mechanism which is of value, and perhaps table an amendment himself in another place. That is the right way to proceed.
I agree with the right hon. Gentleman that it is acceptable for a Back Bencher to be detached from the minutiae of the matter under discussion. Is he surprised to learn that just a moment or two ago, the hon. Member for Mole Valley (Sir Paul Beresford), a former leader of Wandsworth borough council, "corrected" my geography by saying that Wandsworth and Westminster are not adjacent. They are adjacent, as the House of Commons Library has just demonstrated for me. Nine Elms faces Pimlico across the river. I wanted to put that correction of the hon. Gentleman's false correction on the record.
I do not think it right for me to deal with the geographical issue that the hon. Gentleman raises, but the essence of his point is entirely wrong. Having attacked the money that went to Westminster year in, year out when the Conservatives were in power, on taking office this Labour Government found that the figures were absolutely right, and that they had to stick by the truth of the then Government's position. The hon. Gentleman has forgotten what has happened in the past eight years and he ought to remember it.
As I said, if we are to have a property tax, we must have a valuation system. I am in favour of a property tax, having looked at every other system. I know that it would be wrong to discuss those systems now, but I must tell the Liberal Democrats that the worst system that I came across was local income tax. It was—
Order. A little while ago, the right hon. Gentleman said that I had missed a lot of a very interesting debate. I have been following it very closely from outside the Chamber—as, of course, I always do with such debates—and I have noticed the number of times that Members have had to be called to order to ensure that they address the amendment. I am doing that yet again to the right hon. Gentleman, and I tell all Members that I want them to speak to the amendment; otherwise, I shall pull them up rather sharply.
I am grateful, Mr. Deputy Speaker; I should have phrased my argument in the following, slightly different way. Because I find the alternative so impossible, it is very important to make this system work, which is why this amendment is so crucial. It would not be so crucial were it not for the fact that, if we do not make the council tax arrangements work effectively, we will not have a better alternative. So this debate is as important as I suggested to you that it was, Mr. Deputy Speaker, when you first took the Chair.
So the issue is: how do we approach this part of the mix that makes the council tax? The council tax is a property tax. Few countries have been able to handle taxation without some form of property tax. Ireland tried to do without one, but I suspect that it has been trying to change back—a difficult thing to do. The real problem was identified by my hon. Friend the Member for Rayleigh (Mr. Francois). He rightly said that he represented the Thames Gateway, where the changes promised—if that word is not too generous—by the Deputy Prime Minister will make this problem especially difficult.
The difficulty is that perception and reality are often very far removed from each other when the system involves so many components working together. I do not know about the Minister's constituency—or yours, Mr. Deputy Speaker—but I am willing to bet that not many people in anyone's area would be able to explain the interpenetration of the various elements, year on year. Therefore, we need to make the system more transparent rather than less transparent.
Does my right hon. Friend agree that the great complexity of the system makes people wary about revaluation, especially after what happened in Wales? When we shifted from standard spending assessment to formula spending share as a mechanism to provide grant to local authorities, council tax rose by so much in the south-east that people believed that a revaluation in England would be, in a sense, bent. That is why they were so resistant to it in many parts of the south-east of England.
Order. I think that the right hon. Member for Suffolk, Coastal (Mr. Gummer) might be tempted again from the straight and narrow. I hope that he will not be.
Thank you, Mr. Deputy Speaker. My hon. Friend has made his point, and I agree with it, but I shall not go down that route.
How do we make the process more transparent? One way is proposed in the amendment. Where it is obvious that the incidence of the council tax has ceased to reflect properly the nature of the area involved, there needs to be a way to remedy that by means of a local revaluation. That is the justification behind this proposal.
However, if it is a question of perception, whose perception matters? I disagree with my right hon. Friend the Member for East Yorkshire (Mr. Knight) about that. He and I worked at the Department of the Environment in close harmony and, as far as I am concerned at least, with considerable pleasure. However, in this instance, I believe that he has thought too much about the central issue, and too little about the local issue. Because of that, in the end I decided that I could not support the amendment quite as I had hoped.
If there is a perception of unfairness of incidence in a locality, local people should be able to ask, through the local council, for a revaluation. Councils in East Dorset, Christchurch, Suffolk Coastal or Waveney could say, "We want a revaluation because we can't fairly deal with our population as a result of the huge change that has taken place. We need, therefore, to check out the incidence of the council tax, so as to be fair to the people who elect us."
In such circumstances, I believe that it should be necessary for the Secretary of State to allow a revaluation. He should not be able to say, "You can ask, but I'm not going to do it." He should be required to allow the revaluation, because many people outside the House may be surprised by the mechanisms available to the Secretary of State to put pressure on people. It is for that reason that I dissent about the amendment.
I cannot go into detail, for fear of straying out of order, but we have been talking about the Thames Gateway in particular. In that area, it might not be possible to build many of the houses intended because of the flood plain. What would happen if the Deputy Prime Minister insisted that the houses were built and the insurance industry refused to insure them? The valuation situation would then be very complex, but it would be localised, not nationalised. At the moment, the Secretary of State has outrageously bamboozled the insurance industry by ensuring that the life offices put pressure on those that insure houses by saying, "If you get uppity with the Secretary of State, we will be in trouble over pensions provision, so don't do it." We all know the institutional corruption that goes on—Governments use their power over one lot to make others not do something. I hope that the insurance industry will develop some toughness in that area.
If the houses are built in the Thames Gateway, their value will be crucially affected by whether they can be insured, and a local revaluation will be essential if there is to be fairness in the incidence of the tax. I hope that we do not reach that situation because, as an environmentalist, I do not want those houses to be built. I do not understand why we are trying to shove into the south-east of England houses that could, in today's world of communication, be spread more evenly over the nation. But then this is about the least environmental Government that we have had for a long time. My right hon. Friend the Member for Bromley and Chislehurst does not help by holding up the one Bill that has been introduced that has been worth having. I hope that he will change his mind about that.
The local revaluation suggested by my hon. Friend the Member for Mole Valley would be essential if significant local changes occurred that needed to be taken into account. I note that even those who have opposed this particular formulation, who come from a local government background, have emphasised the need for such a change. It would therefore be foolish of the Government to avoid it.
This is an issue of transparency and perception. Therefore, one has to face up to the second difficulty that the amendment presents. It could be used for purposes totally other than those that were conceived. Some of those purposes might be reasonable, but would not be suitably covered by this amendment. Let us for a moment accept that it might be sensible to have an elite group of people who went round the country carrying out valuations, as my right hon. Friend the Member for Bromley and Chislehurst suggested, which might be cheaper. The people need not even be employed by the Valuation Office Agency, because they could be employed privately, or seconded, or paid for under some tender system.
The trouble is that the amendment would give no guidance to the Secretary of State as to the basis on which that sequential activity should be performed. My hon. Friend, in explaining that, gave us to understand that that was not really his purpose for the amendment, although my right hon. Friend rightly identified it as a possible advantage. I would go further. One of the reasons I liked the amendment was because it would enable pilot schemes to be carried out in several places, so we would be able to see whether the perception of our constituents that a change in valuation would be unfair to them was true or not.
Indeed, one of the problems, Mr. Deputy Speaker—you represent a neighbouring constituency to mine—that we have all found in this debate, across party lines, is that people feared that whatever the valuation was, it would do them down. The only way to deal with such a fear may be to carry out a localised valuation in certain places that are sufficiently different so that one could discover whether revaluation had the effect in England that it had in Wales.
Of course the amendment would have an advantage. Unlike in Wales, where no ceiling was imposed and such things were not done in the same envelope, if a revaluation took place in an area, it would have to reach the same total that obtained before the reassessment realigned the weight on any property. The problem in Wales was that a lot more money came out at the other end. Of course, everyone knows that that is what the Government intended, which is why we opposed the revaluation in the first place.
Such a system could be used for the valuable purpose that I propose, but only if regulations were laid down to ensure that it could not be misused. For example, a revaluation should be triggered only by the local authority, except if a pilot scheme was restricted to a certain number to ensure that it was used for the intended purpose. There is a disadvantage in the amendment, because we have not covered that issue and we should try to do so.
That is an interesting argument. Is my right hon. Friend volunteering Suffolk for a pilot scheme?
It would not be for me to volunteer my own county; it would be for the local authority to make those decisions. Indeed, just as I do not interfere in my local authority's decision making, I do not expect it to interfere in mine. That is why I felt strongly when the Government lent on chief constables in relation to the issue that we are not discussing now because the Government are ashamed of it. That is why we are debating the amendment and not that issue, but I will not continue down that line, Mr. Deputy Speaker, because I may get into trouble.
I agree that localities would have to volunteer, but I suggest that, for the greater good, it may be necessary to give the Secretary of State a limited power to carry out a small number of pilot revaluations to discover whether the system was usable in the way that I propose.
I am worried about the amendment for a third reason. My hon. Friend the Member for Mole Valley lost the House a little in explaining the amendment at the point at which he distinguished between the use of the valuation as means to share out locally the total bill and its use in the Government's hands as means to determine the grant. That is a complicated issue, and it is one of the very difficult issues that we face in trying to deal with our constituents. The amendment's transparency is insufficient to help my constituents to understand what is in any event a very detailed problem.
Hon. Members will remember that it has always been thought that there are three attributes that give one the right to read mediaeval philosophy. To understand the philosophy of the mediaeval schoolman, one must be able to understand the monetary compensatory amounts in the European Union's common agricultural policy, or the way in which grants under the previous rating system worked, or the present Government's grant-giving system. I am happy to say that I understand all three, but that has not given me a taste for mediaeval philosophy. That is merely an accident of history, but it leads me to believe that the amendment is deficient, because our constituents must be able to understand the legislation without also being enabled to read mediaeval philosophy. It seems to me that we must make the system easier for them.
The Minister will wind up the debate after having had the considerable benefit of hearing the wide range of views that Conservative Members have had to present owing to the total absence of Labour Members. He really cannot complain if I am slightly out of kilter with my Front-Bench colleagues, or that my right hon. Friend the Member for East Yorkshire and my hon. Friend the Member for Mole Valley have different views. The Minister could have got us out of that problem by bringing some of his hon. Friends, who are known not always to agree with each other, into the Chamber to extend our understanding of how they get away with bigger grants than anyone on this side of the House—perhaps they are too ashamed to explain it.
Even though the Minister is bereft of support on the Labour Benches—[Interruption.] Of course, the hon. Member for Ipswich (Chris Mole) is sitting behind the Minister. The hon. Gentleman's tenacious support for Government policy, contrary to the interests of his constituents, has got him where he is, and will no doubt get him further very soon. That is why he has not been fighting for his local hospital, although I have. I am sorry, Mr. Deputy Speaker, but that is one sentence that in your heart you will find it hard to attack me for. Hon. Members should understand that Mr. Deputy Speaker and I share the same hospital.
The Minister must understand that the real issue is his ability to meet people's needs. I happen to like him, and do not think that he has been too involved in some of the shenanigans that have been going on. I happen to think that they have almost entirely come about due to the Deputy Prime Minister, for whom shenanigans are a way of life.
I think that the Minister wants to make the system, such as it is, as effective as possible and that he wants to have the powers necessary for that. He ought to have limited powers to be able to use such a technique for what I call polling testing—to find out whether it works—because that is a useful thing in government. He should also have the duty to enable a local authority that wants a local revaluation to carry it out, but I do not want him to have the powers that amendment No. 3 would give him.
I am drawing to the end of my speech, but my difficulty now is knowing what to do. If the Minister says that he will take on board the points that we have made and look favourably on trying to finding a better-suited mechanism through which he could give himself the elbow room that he needs—given the Lyons inquiry and the like—but that would not require revaluation for a property tax for some time, perhaps along the lines of that which I humbly presented, which would not be too difficult to implement, I know exactly what I will do: I will ask my hon. Friend the Member for Mole Valley not to press the amendment to a Division. However, if the Minister says, "No, I certainly will not. What a load of old rubbish; we don't want that at all," my difficulty is that if I do not support the amendment, I will not have made the point that something must be done.
I am grateful for having the opportunity to catch your eye, Mr. Deputy Speaker, and to explain the basis on which I have approached the matter. Despite all my caveats, if the amendment is pressed to a Division, I will have to vote for it so that the Minister understands that the issue cannot be escaped. Their lordships will understand that they should address the matter, albeit perhaps more elegantly than my hon. Friend the Member for Mole Valley had time to do—I put that as delicately as I can because I do not want to make him unhappy. By that time, perhaps their lordships will have proper copies of the 1992 Act so that they will know what to do.
I was in the Chamber at the beginning of this illuminating debate, but had to leave to consider a statutory instrument. Will the right hon. Gentleman confirm that the amendment would cover all the properties whose values have risen during the course of the debate?
If the hon. Gentleman gets in touch with some property people, he will find that prices are rising and falling almost simultaneously. I declare an interest as a regular columnist for the Estates Gazette, which is one reason why I know a little bit about these matters. It is now more difficult to forecast property prices because they are going in different directions in different places and in different bands. His question is more complex than it appears, so I shall not answer it—and if I did, I suspect that you would stop me, Mr. Deputy Speaker.
I believe that a change has to take place, but that it is impossible to give the powers in the amendment to the Government because in the distribution of grant and of national health service funds and in a range of other examples, they have shown that they make party political and not objective decisions. I do not know of a Government of any kind—Labour, Conservative or, looking back a long time, Liberal—who have behaved as the present Government have done. That is an extremely sad thing for our democracy, because it undermines the ability to support this place and the way in which our democratic system works. It is noticeable that, for example, the major criterion in determining how much money goes to the NHS is no longer age, but deprivation, which is much more difficult to fix but has to do with the problems affecting a particular area, which may have nothing to do with health. The result—surprise, surprise—is that the areas with some of the oldest populations in the country do not get as much as some of the areas where there are far fewer health problems. That happens because of the technique that has been introduced.
I cannot accept the amendment because I cannot trust the present Government. To be fair to the Minister, I do not take him in the same way, but like my right hon. Friend the Member for East Yorkshire, I do not believe that this House should trust any Government with any powers that it can avoid giving them. Governments exist to do as little as possible, not as much as possible, and the House must keep in its hands the powers of ensuring that Governments behave properly. Ultimately, that is why I am most unhappy about the amendment. Whether a Government are Tory or Labour—I am referring to likely Governments—they should not be trusted with the powers in the amendment, and the present Government should certainly not be trusted with anything that would enable them to manipulate the system for party political purposes. I do not want them to be tempted down a road that they are already further down than any previous Government.
If the Minister assures me that he will give the matter his consideration, make some changes and table an amendment, I shall seek to ensure that the amendment is not pressed to a vote, and if it is pressed I shall vote against it. If, on the other hand, he cannot do that, I shall hope that the amendment is pressed and vote in favour of it.
I am delighted to follow my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer). To make the arid subject of local government finance cogent and amusing shows what considerable skill and experience he has.
My hon. Friend the Member for Mole Valley (Sir Paul Beresford) has done the House a huge service, because we have had an interesting and much needed debate this afternoon, but if he presses his amendment to a vote I shall probably not vote with him. My main reason for not supporting the amendment is that I believe that it is premature. The Government set up Sir Michael Lyons' inquiry to look into local government finance and it will be interesting to see what Sir Michael comes up with; only then, after careful consideration, should we decide what is to be done.
Local government finance has got into an almighty muddle. When council tax accounted for a relatively small proportion of income, people were not so worried, but now that it takes up so much greater a proportion of income—particularly for people on fixed incomes such as pensioners and other poor people—it is becoming a much greater problem. Any property tax should, as far as possible, reflect open market value. My hon. Friend's amendment is therefore on the right lines—although, as many of my hon. Friends have said this afternoon, it would have been much better and would more accurately have reflected my party's policy on the matter if it had allowed local authorities, not the Secretary of State, to make the decision.
I have considerable worries about the Secretary of State being able to make such an order. If the Minister is inclined to accept the amendment, will he tell us on what basis the Secretary of State would make an order obliging an individual authority or a group of authorities to undertake revaluations? The measure amends section 22 of Local Government Finance Act 1992, as amended by the Local Government Act 2003, and we are seeking again to amend that section.
On what basis would the Secretary of State make such an order? I can think of a number of reasons why he might, but I wish to probe the matter further. In an area where, when the council tax was originally introduced, property prices were not rising at anything like the present rate, it was envisaged that properties would be put into a band and, provided they were put into the correct band, all properties would increase in price relative to each other. However, in the past few years property prices, particularly in the south of England and the commuter belt of London, have increased very fast. That has led to a huge disparity not only within individual billing authorities, but between billing authorities.
As I mentioned in an intervention, new properties are immediately put on to the valuation list in their full market band, whereas older properties are not. That immediately leads to a distortion. One could see good reason for ordering a revaluation in an authority that had had fast rising prices, such as my own in Cotswold, or in another authority—perhaps that of my hon. Friend the Member for Northampton, South (Mr. Binley)—where a large number of new properties had been built. Those are two good reasons for ordering a revaluation. A third reason might be that large numbers of properties had been extended. The moment a property is extended, it tends to be revalued and put in an upper band. Because of the distortion of stamp duty, many people are finding it cheaper to extend their property than to do what they would have done in the old days—sell a smaller property and buy a bigger one. That is happening to a lesser and lesser extent.
Does my hon. Friend agree that another reason could be that property values have changed and there are two houses or more in the same turning with different bandings? Local authorities should have the right to alter that, so that it is fairer for everyone.
I entirely agree. I shall return to that, if my hon. Friend will allow me, a little later in my speech when I deal with the problem of appeals and the cost of appeals.
Is my hon. Friend sure that if a new house is built, it is valued at today's price rather than the 1991 price? If he is right about that, almost all new houses would be in bands G and H.
My hon. Friend raised that with me privately earlier. I should like to research the point further. I hesitate to contradict somebody as knowledgeable as my hon. Friend. He may well be right.
A fifth reason for ordering revaluations in a particular local authority is that a large number of properties are bought and sold. A property can be revalued if its original value is severely out of kilter with its price when it is bought and sold. In the south of England, for example, many more properties are bought and sold in an individual billing authority than in some of the more northern authorities.
Those are some of the reasons for revaluations. I should like the Minister to tell us why he would want to order an individual billing authority to undertake a revaluation. What about the distortion that would cause between one authority and its neighbouring authorities?
My hon. Friend the Member for Christchurch (Mr. Chope) has mentioned that his constituency contains two billing authorities. My constituency also contains two billing authorities: Cotswold district council, where property prices tend to go up very quickly—the rate of growth is probably one of the highest in the United Kingdom—and Stroud district council, where property prices are not increasing so quickly. Under the amendment—this is why I am going to vote against it—the Secretary of State might order a revaluation for the Cotswold area, but not for the Stroud area. In those circumstances, what would happen to properties on the border? What would happen to people who live in Cotswold and who have low-paid jobs in Stroud? All sorts of distortions could emerge.
May I suggest another potential category—areas in which large numbers of houses have been demolished? I am sceptical about the Government's programme of demolishing houses, particularly in the midlands and the north of England, and I am not sure whether they are doing the right thing. Such demolitions could affect other properties in the area, in which case residents might want a revaluation.
My hon. Friend, who has a huge knowledge of the subject, must be clairvoyant, because he has read my mind and anticipated my next point.
A fifth reason to revalue an individual billing authority is because it contains either a large number of empty properties or, as my hon. Friend has said, a large number of properties that have been demolished. A large number of such properties tends to distort the lists and make them out of date, and my central theme this afternoon is that lists should be up to date because values should reflect the amount of tax paid.
A sixth reason why the Secretary of State might want to instruct billing authorities to carry out revaluations is because the area contains a large number of second homes. As my hon. Friend the Member for Rayleigh (Mr. Francois) knows, because he and I served on the Committee that considered the Local Government Act 2003, it is now possible for local authorities to exercise their discretion and charge council tax on second homes by abolishing up to 90 per cent. of the rebate, which means that people pay almost full council tax. That has happened in Cotswold, where people pay nearly full council tax on their second homes. If there is a large number of second homes in a local authority area, it can cause distortion, which is another reason why the Secretary of State might want to order a revaluation.
Perhaps the Minister will tell us how such revaluations will work. Indeed, I think that my hon. Friend the Member for Mole Valley will have the opportunity to sum up amendment No. 3, so perhaps he, too, will tell us how such revaluations will work. I am worried about the timing of the Secretary of State making an order because the amendment does not deal with timing. From when would the Secretary of State make an order and for how long would the listing agency have to compile the lists? If the lists were very out of date in the six categories that I have mentioned, the task would be much greater than that in authorities in which the lists are up to date—[Interruption.] I shall give way to my hon. Friend the Member for New Forest, West (Mr. Swayne), who no doubt has an excellent new angle.
With respect to my hon. Friend's fifth category—authorities in which there has been a great deal of demolition—it would not take very long to compile the list.
Indeed, it would not. Nevertheless, if demolitions had occurred, presumably new buildings would have been constructed, and they would need complete revaluation, which would be an onerous task.
If a peripatetic group of valuers were employed to save money, we would be short of staff if a rash of applications occurred.
Indeed. In her customary way, my hon. Friend has made a good point. The Valuation Office Agency is staffed on a regional basis. If there were a lot of revaluations in, for example, the north-west, and if the Government in their wisdom had redirected local authority staff towards the north-east, which they tend to do, we would find ourselves in a muddle.
My hon. Friend will have heard my hon. Friend the Member for Christchurch (Mr. Chope) explain the use of the private sector, which I should have thought would interest him.
That is an interesting point. I reiterate my declaration in the Register of Members' Interests that I am a fellow of the Royal Institution of Chartered Surveyors, and I think it an excellent idea to contract out some revaluation work. I seem to have unwittingly provided the very reason why it should happen—because then the Valuation Office Agency would not need such a huge permanent overhead. I am beginning to think that my hon. Friend's amendment might not be so bad after all. When there was a rash of revaluation, it would be a good idea for the private sector to do some of the work.
I want to move on to the next section of my speech—
Before my hon. Friend moves on, can I take him back to an argument of his that I did not find very convincing? Where there has been demolition in an area that is in the course of being redeveloped, is not there a good case for not having a revaluation but waiting until it is fully redeveloped, because that will have a huge effect on property prices?
My right hon. Friend makes a partly good point. When I held my party's housing and inner-city brief, I found that large-scale redevelopments in areas such as Moss Side in Manchester tended to take place over several years. It is highly unlikely that the entire demolition in a redevelopment of any size would take place in one go—it would be phased over a number of years. The effectiveness of the revaluation in dealing with the problem that my right hon. Friend mentions would depend on the stage in that process at which it was ordered. Any big redevelopment of that kind would have areas that had been demolished and rebuilt, areas that had been demolished but not rebuilt, and areas still waiting to be demolished. The point at which the revaluation was ordered would be a matter of judgment.
Does my hon. Friend accept that that does not necessarily have to be the case? In some developments, the whole area is cleared at once—for example, railway marshalling yards, where the land is cleared and then brought into use all in one go.
That is entirely possible. Of course, in the bigger cities the scale becomes bigger. That would have to be considered carefully. I am sure that the Minister will tell us whether it is one of the factors that he would take into account in ordering a revaluation.
Does not this whole debate make the argument for introducing more flexibility into the whole system of revaluation, which is the point that my hon. Friend the Member for Mole Valley (Sir Paul Beresford) is making in his amendment?
Yes, with one gigantic caveat—that it should not be ordered by the Secretary of State but be in the control and at the discretion of individual local authorities. Those of us who believe in localism and in local government per se must agree with the democratic system whereby we elect local councils such as that of my hon. Friend. I am aware of the excellent work that he has done, and continues to do, in Northampton. We elect such people to do this work on behalf of us, the people, and we should hold them accountable for the decisions that they make. If they make the right decisions, they will be re-elected. I have no doubt that my hon. Friend will be re-elected for many years to come.
In the light of my hon. Friend's professional and political experience, is it his view that large-scale demolition would force the value of local properties up or down?
I was about to come to that point. My hon. Friend must be clairvoyant, too, because he has read my mind and anticipated the next section of my speech.
The subject of the valuation base is very interesting, if dry. The whole business of local government finance is incredibly complicated. It involves about 200 different sections, including algorithms and all sorts of complicated mathematical formulae, one of which relates to the council tax. House prices are rising in almost all areas in the United Kingdom and that means that the valuation base would probably increase on revaluation. I suspect that that would happen because the general area would improve. Moss Side is a prime example of such improvement. Houses were demolished, new houses were built and green parks, new schools and new doctors' surgeries were created, thus improving the whole area to the extent that one of the most crime-ridden areas in Europe is now a pleasant place to live. The private sector has built houses in the area that sell for a great a deal of money. That proves what successful wholesale refurbishment of an area can do. I suspect that if an area were sensitively demolished and refurbished, the council tax base would increase.
I want to make another important point about the increase in the council tax base. My hon. Friend the Member for Mole Valley did not agree, but the complicated algorithms and formulae that are used to calculate the rate support grant settlement include a redistribution mechanism if the valuation tax base is higher than average. For example, areas such as the Cotswolds, where the council tax base is high, lose out on the rate support grant settlement because some of our council tax is redistributed. The Government redistribute from areas with high council tax bases to areas with lower council tax bases.
I am sure that my hon. Friend shares my concern that areas that are deemed wealthy contain areas of relative deprivation. They will be hit even worse by the measure.
My hon. Friend is a clairvoyant.
Will my hon. Friend give way?
I should like to answer my hon. Friend the Member for St. Albans (Anne Main). I am flattered that so many colleagues wish to intervene on me. It shows that my speech is either very bad or raises more questions than it solves.
The latter.
My hon. Friend the Member for St. Albans made a good point. The core theme of my speech is that a property tax must reflect market value as closely as possible. If we allow them to get out of kilter, we create increasing unfairness in the system. One unfairness affects people on fixed incomes, who tend to be fixed in their houses. If their houses become relatively more valuable than other houses, the system is unfair to them, and especially to retired people. The third highest number of people aged over 85 in the country live in the Cotswolds, and the problem therefore worries me greatly. That is one reason for keeping the matter reviewed and up to date.
My hon. Friend is making an excellent speech, but I echo the comment of my hon. Friend the Member for New Forest, West (Mr. Swayne) that it raises many questions. His explanation of the equalisation system suggests that local authorities whose rateable value is below average have a disincentive to go for revaluation, because if their council tax base increases they would lose the benefit of the transfers from south to north that penalise council tax payers in my constituency.
My hon. Friend has hit the bull's eye. That is what is wrong with the amendment. I believe that the Secretary of State will use the power for the wrong reasons and my hon. Friend outlines one of them. I should therefore like the power to be vested in local authorities because they know what is best for the area and whether they should order such a power. My hon. Friend raises a genuine, worrying possibility.
My fear is that whether the power is ordered by the local authority or the Secretary of State, it may inadvertently have the same effect. The Secretary of State could order it to cause a transfer of resources, but even if the local authority ordered it for some other purpose, it could have the same effect. Local authorities would not wish to use such a power lightly.
My hon. Friend makes a good point. Indeed, I made it earlier in an intervention. The Secretary of State could use the power for punitive reasons. For example, instead of council tax capping an authority, he could use the threat of the power to encourage it to keep its percentage increase of council tax down to a level that he deemed acceptable. Again, I would think that totally reprehensible, but one can imagine a certain Secretary of State—not the Minister for Local Government—who is very honourable, doing exactly what my hon. Friend says.
As I said earlier in the debate, I have a particular interest in this matter because Wellingborough has had the biggest increase in council tax since the council tax was introduced. My concern is that the proposal would be a backdoor way of increasing the amount that my constituents have to pay in council tax.
I will give way to my hon. Friend in a moment, although I think that I can answer what he is about to say—that a revaluation per se does not necessarily give rise to an increase in council tax, although it probably will do so for the very reasons that I mentioned. Even if it does not give rise to an increase in council tax immediately, the revenue support grant will be reduced to support the redistribution mechanism about which I have talked. I therefore have a lot of sympathy with the point made by my hon. Friend the Member for Wellingborough (Mr. Bone). I think that my hon. Friend the Member for Mole Valley wants to contradict me.
I thank my hon. Friend for the opportunity to do so. I think that he fails to understand something that I have stressed time and again. The aim of a revaluation locally is a fairer distribution within the local area, but a national revaluation will make a difference to the way in which the grant is distributed, which was also a point that I made. Ability to pay should therefore be estimated on a basis of tax paid or income earned within billing areas, which has already been done by the Treasury.
My hon. Friend has huge knowledge of the way in which local government works and I am hesitant to contradict him. The way of the world, however, is that a revaluation will put considerable pressure on a local authority to increase council tax. To stick to the mechanism whereby council tax should not go up, if the revaluation causes an increase in the entire list the rate of council tax would have to go down. I cannot imagine many councils explaining to their council tax payers that they have put the rate of council tax down in order to keep the council tax the same. The way of the world is that the valuation would go up and the council tax rate would stay the same, so the actual amount payable would go up. I do not know whether my hon. Friend wants to come back on that point—he is shaking his head. It is not necessary. There we are. The whole purpose of this kind of debate is to get differences of opinion out in the open—parler, to speak, is what Parliament is all about. I am pleased to take part in this debate.
I have almost come to the end of my speech, but suffice it to say that when the Lyons' committee comes to report on this matter—next year, I gather, in tranches—I hope that the Government will take it very seriously. We have had some excellent debate this evening. There is a lot of merit in the principle proposed by my hon. Friend—that there should be an ability to have local revaluations, provided that it is under the democratic control of locally elected councillors. I hope that the Lyons' report will deal with that matter.
Before I conclude, I want to deal with the problem of appeals. At the moment, appeals only take place in the categories that I have mentioned. Were there either a local or national revaluation, however there would be a lot more appeals. That would increase the work of the Valuation Office Agency, and perhaps it would be useful to sub-contract that to the private sector, too. Appeals take time, cost money and cause a lot of angst to our constituents, so we should try to get valuation lists accurate. Where changes do not take place for individual streets and houses within individual streets, whatever revaluation takes place under my hon. Friend's proposal or any future Government proposal the number of individual differentials could be kept to a minimum and the number of appeals reduced.
My hon. Friend makes an interesting point about appeals and I should like to draw a brief analogy with the planning system. As resistance is hardening to many planning applications, particularly but not exclusively in the south-east, the Government are running out of planning inspectors to adjudicate, so it often takes more than a year to obtain a public inquiry as there are not enough planning inspectors to go round. That is becoming a real problem in the planning process, so does my hon. Friend agree that it could be an additional problem in the valuation system?
My hon. Friend, with his huge knowledge of such matters, is right. The Government are having to produce a special planning grant to try to encourage local authorities, such as mine, that are extremely short of staff due to high housing costs to employ planning officers. The same would apply for valuation officers in the listing authorities. Of course, as has rightly been suggested, the solution would be to employ the private sector to do the work. There would then be no need for a permanent overhead.
The amendment is premature. It contains many good intentions, as is always the case with proposals made by my hon. Friend the Member for Mole Valley. However, we should wait for Sir Michael Lyons to make his report and reconsider the amendment in due course.
This obviously essential debate has raised many subjects, and I should like to touch on a few of them in my brief contribution. I made a note that we have talked about local accountability and flexibility, the relative costs of different approaches, the impact of local developments, whether anomalies could be better corrected nationally or locally, the Valuation Office Agency and the role of the Secretary of State, to say nothing of appeals, which my hon. Friend the Member for Cotswold (Mr. Clifton-Brown) has just mentioned. All are relevant and I shall touch on them as I go through my speech.
To set a context, we need to establish the provenance of the matter. That takes us back to the beginning of the debate, when Mr. Speaker very graciously and with enormous efficiency was able to produce the missing Act—if I may call it that: for we started the debate without the very Act on which the whole matter is based. Fortunately, we now have it and I want to ensure that the House understands that the amendment proposed by my hon. Friend the Member for Mole Valley (Sir Paul Beresford) refers to an order under subsection (1A), which in turn refers to the Bill where subsection (1) of clause 1 refers to section 22B of the Local Government Finance Act 1992. That is where we got into immediate difficulty, as we were all wondering how on earth the debate could be properly conducted without the missing Act. It is fair to say that initially we were floundering in a mist, which is unusual for us as we are always clear-eyed and sharp of mind. On this occasion, however, we started at a disadvantage.
Mr. Speaker sorted all that. He waved his wand. He exuded and exerted his authority and the Act was quickly to hand.
I have a copy of the Act. It is a bundle of photocopied sheets and it looks as though there are about 1,000 pages to go through. Is not it a bit late to do that?
I shall help my hon. Friend. I am glad that he made that point, although I do not need to go through 1,000 pages—not yet anyway, unless I am tempted. I zeroed in with my laser-like focus on the very parts of the Act that form the foundation of the Bill from which the amendment flows. He will be able to see that direct connection, as I hope will everyone else in the Chamber.
In section 20, we find the genesis of the whole matter that we are discussing. It states:
"The Commissioners of Inland Revenue shall appoint a listing officer for each billing authority."
We can see immediately that the matters dealt with by the amendment flow from clause 20. Section 21 spells things out:
"The Commissioners of Inland Revenue shall . . . carry out . . . valuations of dwellings in England and Wales"
and
"furnish listing officers with such information obtained in carrying out the valuations or in the exercise of the powers conferred by section 27 below."
So we can begin to see how we are building up the approach, the philosophy and indeed the bureaucracy—to which we shall return later; it has of course been touched on already.
Does the 1992 Act require one commissioner for the whole country or individual commissioners for each separate authority? If there were more than one commissioner, they may have different interpretations of property values in their area. How can we be sure of achieving consistency?
My perusal of the Act has not elicited that information, but I guess that, sadly, the reference is a general one. Section 21 states:
"Commissioners of Inland Revenue shall . . . carry out valuations of dwellings in England and Wales".
We can infer a national approach from that provision, but section 22 states:
"In accordance with this Chapter, the listing officer for a billing authority shall compile, and then maintain, a list for the authority (to be called its valuation list)."
There is therefore a trickle-down from the national approach with which the commissioners are taxed to the local level, so we are getting into the nitty-gritty of the amendment and the Bill. The 1992 Act provides the infrastructure for the Bill and the amendment.
May I echo my right hon. Friend's concern about the fact that certain documents were not available earlier? The Bill refers to the Local Government Act 2003, copies of which were not available in the Chamber when we began our debate. On investigation, I discovered that it was available in the Vote Office. That is important, because the Bill repeals schedule 7 of that Act. Paragraph 52 (4) of the schedule states:
"In subsection (3) (instruments subject to negative resolution), in paragraph (a) (exceptions), after '11(3),' there is inserted '22B(3)(a),'."
I hope that that reassures my right hon. Friend.
I am glad that my hon. Friend mentioned section 22B of the Local Government Finance Act, as I have a copy of that provision in my hand. As always, he and I are working in concert. As was said in an intervention, section 22B says that the listing officer
"must take such steps as are reasonably practicable in the time available"
to ensure that the list is accurately compiled. Such phraseology is worrying.
I raised this matter in an intervention. There has been much speculation in the press because, for the first time, listing officers may enter people's houses to take photographs. Does my right hon. Friend agree that that is unacceptable? An Englishman's home should be his castle.
Order. I would not want the right hon. Member for Bromley and Chislehurst (Mr. Forth) to be tempted down that road. The availability of the Act, too, is not quite as crucial as he has suggested. I am sure that hon. Members know where to find these things in the House of Commons.
I was simply referring to section 22B of the Local Government Finance Act, which I had in my hand. I thought that I was on safe territory, but these days, who knows?
My hon. Friend the Member for Cotswold (Mr. Clifton-Brown) has identified a tension in the Bill. The listing officer can take such steps as are "reasonably practicable" to ensure accuracy. That is where the process that he described comes in. Indeed, it is where the heavy-booted tax inspectors come in.
Is not the way in which the revaluation is undertaken in one billing authority, two billing authorities or nationwide relevant to the amendment? I favour a pilot scheme for revaluation in my own area, but I would not if I thought that regulation-ridden, form-filling, pen-pushing nincompoops were going around with cameras photographing my constituents' properties.
Indeed. My right hon. Friend knows all about his constituents' dwellings. Accuracy is important and there is a contradiction in section 22B. It refers to steps which are "reasonably practicable", goes on to talk about "the time available" and ends with a reference to accuracy. In many circumstances, the three requirements could well prove contradictory. The practicality is one thing and the timing another, but where does that leave the accuracy? Those contradictions have not been resolved, and even the amendment does not resolve them.
Labour as well as Conservative Members need to ask themselves to what extent they want to keep faith with the new mantra of localism. The practice has become popular among politicians of constantly reasserting how strongly they support the concept of local decision making, whether in schools, hospitals, local authorities or anywhere else. On the face of it, that is one of the attractions of the amendment. In some ways, it seems to move us in that direction by providing an opportunity for much more local decision making than has been available hitherto in this great valuation exercise. That in turn, however, poses a number of questions, some of which have already been touched on today.
The most fundamental of those questions is whether we believe that, in the whole business of valuation of properties to establish a tax base, a national approach is preferable to a local approach. I must admit that, having listened to the debate so far, I have not yet made up my mind. I can see both sides of the argument, which is rare for me. As many of my right hon. and hon. Friends pointed out, there must surely be a strong case for saying that, because this is potentially such a local matter, we must give priority to the local decision-making element that the amendment would allow. Many examples have been given, ranging from new build to demolition.
The new build case is clear. My expert friends have observed that, with new build, the valuation tends to be at current market rates, if I have understood them correctly. Some doubt has been raised about the effect of demolition, however. It could perhaps move us in either direction. While demolition in a blighted area that was then cleaned up and made into a community facility would undoubtedly enhance the area, I am sure we can all imagine other circumstances in which the effect would be the reverse.
I am glad that my right hon. Friend is exploring the anomalies. The Lyons report does not refer to assessment triggers such as whether a house is in a conservation area. In my constituency the small, modest two-bedroom cottages are in a conservation area, while the big five-bedroom houses are not.
My hon. Friend has, typically, given a good example of problems that feature throughout the valuation exercise, and with which we must all grapple. That is part and parcel of the important debate about the extent to which we believe that local circumstances and variations should override any other consideration. Again, on the face of it the argument is appealing, but I have my worries. I shall say more in a moment about the malign political influence that has already been touched on.
Will my right hon. Friend give way?
I do not know whether my hon. Friend wants to talk about malign political influence, but I give way to him.
Perhaps, in a way, I do want to talk about malign political influence. May I return to wholesale demolition and its effect on the charge base in an area? If it reduces the charge base, will not large equalisation payments be made to the local authority to enable it to provide services?
That worries me as well. Underlying much of the debate is the assumption that a beneficent Government, aware of the process described by my hon. Friend, would automatically compensate for it from central funds. I am not sure that we can make that assumption. Indeed, a number of my right hon. and hon. Friends have said that we must not make such assumptions about Governments, especially this Government. We have seen ample evidence of the Government's ability to move central funding so as adversely to affect the constituents of Conservative Members, so we have to be very careful about that.
There is another issue associated with demolition. With a relatively large-scale demolition, such as that of a big 1960s council estate, when modern properties are to be built, working with a housing association, the people who live on the estate first have to be moved out and found somewhere to live. In the jargon, that is called decanting. Then rebuilding begins, and gradually people start to move back into the new properties as they are built. That process can take several years, so at what point do we revalue? Presumably that will happen when the process is complete, so demolition could be going on for several years, and people would then have to wait for revaluation when the estate had been rebuilt, which could take a long time.
I am grateful to my hon. Friend for that suggestion, because he brings me to the timing of such activities, although I shall not myself get to that point quite yet. The "timeline" is, I think the modern phrase, and it is relevant.
Already we can see emerging a kaleidoscope of criteria on which the matter could be judged. There is the question, "How local do we get?" We have not explored that thoroughly yet, although it was touched on earlier. Are we talking about district authorities, counties or regional authorities? The amendment leaves all that open. We could have individual billing authorities, an undefined
"group of adjoining billing authorities",
or, indeed, all billing authorities. Those are all options under the amendment. Who is to decide? I shall come to that rather later in my meanderings, but at this stage we shall leave it as an unanswered question.
With large-scale demolitions, it is important to get some of the original tenants and owners back to the area to keep the community together. If they thought that their council tax would be increased as a result of a local revaluation, might that not be a disincentive for them to move in the first place?
Indeed it would, if people had that information available. However, the process by which that would come about—indeed, the very predictability of it—would depend on the factors that we are now debating with regard to the amendment, the Bill and the underpinning Act. The flow of the sort of information that my hon. Friend mentions would depend on who had the flexibility, and who made the decisions about the nature and timing of the revaluation. Until we can resolve such matters, the innocents will not have the information that they require. That should worry us all very much.
When my right hon. Friend mentioned individual billing authorities or adjoining ones, he used the dread word "regional". Given the nature of so much guidance from the Government, would it be possible for a valuation officer to consider a group of adjoining authorities in such a way as to cross the magic Government office line, which the Government seem to reluctant to do?
One problem with the amendment is that it deliberately leaves that open, which gives rise to the danger that my hon. Friend points out. By using a phrase as vague as
"a group of adjoining billing authorities",
the amendment may leave too much flexibility, for the reasons that he describes. I shall come back to that thought later, because I do not want to get distracted. [Interruption.] Not half.
I thank my right hon. Friend for his generosity in giving way again. Without wanting to get too bogged down in demolition, may I remind him that there is another important facet? To continue my example, if someone wants to knock down an old housing estate and redevelop it with a housing association, that often involves tenants voting for a transfer—say, from the council to the housing association. For the redevelopment to go ahead, the tenants have to vote for it positively. I have been involved in such cases.
In the real world, the tenants want to know what the additional costs will be—first, what will happen to their rent, and secondly and increasingly, what effect will moving into the new properties have on their council tax? That can affect how they vote in the ballot, and thus whether the whole redevelopment goes ahead. Does my right hon. Friend agree that having such information available could be important in allowing the redevelopment of some of the worst estates in the country?
My hon. Friend is right and he displays yet again his intimate and profound knowledge of these matters, but I am not sure whether that takes us in the direction of localism or of national decision making. He poses a very fair question and I suspect that the answer could be found in either of the two options that I am just beginning to explore.
We have touched on the tempting potential allure of local decision making in this context, but I am not sure that that necessarily determines the issue; I am worried about anomalies and relativities in a national context. If we are too quick to accept the local solution offered in the amendment tabled by my hon. Friend the Member for Mole Valley, there is a danger that even bigger distortions could be created. Once we allow too much local decision making in this crucial area of valuations and listings, we immediately lose control of the relativities that are so important to the whole process.
rose—
I shall give way first to my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer). I do so because he claimed—he is of course correct— that he is one of only three people in the country who understand any of this. For that reason, we are honoured to have him with us today.
Does my right hon. Friend agree that the danger—if it exists—is less than it might otherwise be, given that the revaluation would have to be done within a fixed maximum and that the difference between different local authorities would therefore be maintained? The point that he makes would be much more powerful were it not for that fact. There may be reasons why problems remain—perhaps he would like to adduce them—but I am a rather keen on a bit of variety within those limitations.
I of course accept, hesitatingly, my right hon. Friend's guidance on this issue for the reason that I touched on, so perhaps it is now resolved more or less completely and we can move on.
At the start of this debate, I was considerably confused as to whether to support the amendment; thankfully, on listening to the speeches the situation is much clearer. My Wellingborough constituents are fearful of any revaluation, and the amendment tabled by my hon. Friend the Member for Mole Valley (Sir Paul Beresford) would allow for an earlier revaluation than they want, so, unfortunately, I cannot support it, because it would make revaluation easier, rather than more difficult.
My hon. Friend touches on one of the key issues, which I shall now consider, if I may; it will not distract me from my main argument.
My right hon. Friend touched on localism, so let us consider the very small picture. A large supermarket retailer has bought a considerable number of properties and a small industrial area in a blighted part of my constituency. This situation has been ongoing for several years and under a local system, local people would be pushing the council for a devaluation on the ground of blight. A very local system could lead to the sending of very mixed messages.
That illustrates well the inherent dangers. When we vote on the amendment tabled by my hon. Friend the Member for Mole Valley, we will have to weigh up the various factors and decide in which direction we want to go.
One problem is that, in areas such as the Thames Gateway, which takes in a number of different authorities, too much localism could lead to completely different revaluation results. A wider approach would need to be taken in such areas.
I think that that would depend on the trust that we place in the integrity of the valuation process, a point to which I shall return. First, I want to consider an issue that has been raised a number of times and which we need to discuss in some depth, so that we can establish which is preferable: a central bureaucracy that runs matters nationally; a much more localised approach; or, as we have speculated on throughout this debate, a staggered approach involving a small, compact, expert unit working sequentially, thus potentially saving money.
My right hon. Friend is making a typically thoughtful contribution, but I do not want him to get away from the interesting point raised by my hon. Friend the Member for Wellingborough (Mr. Bone). Does my right hon. Friend think that this amendment would lead to revaluations taking place sooner? That is an important issue and I should be grateful for his views.
I want to deal with the point made by my hon. Friend the Member for Wellingborough (Mr. Bone), which highlighted what many of us see as an omission or lacuna in the amendment, as it still leaves the discretion with the Secretary of State. The initiation of the valuation process must be a local decision, but the amendment does not allow that. It goes halfway, and then stops. Although my hon. Friend's local people may be anxious for a revaluation in the cause of fairness—or not—they would have no say if the amendment were adopted. The local decision makers would not either, as the matter would rest with the Secretary of State.
As so often happens with this Government's legislation, the Secretary of State will decide everything. The Government pay lip service to local decision making but in the end, according to the Bill, matters will be
"specified by order made by the Secretary of State".
I shall explore that later.
Will my right hon. Friend spend a few minutes exploring the power that the Secretary of State would have if the amendment were agreed? He could use it as a threat against local authorities in all sorts of ways. I mentioned rate capping, but he could also use performance indicators to force revaluations on local authorities that did not want them.
One problem with the debate is that it has revealed so many difficulties that it has become more and more difficult to make progress. That is why I shall soon invite the Minister to guide us through and clarify matters. How do we balance local and national interests? What about costs, and appeals? Many hon. Members consider the appeals process very important, but it remains undefined.
All in all, this has been a useful debate, and we are only halfway through, with another amendment to consider and Third Reading still to come. We are all looking forward to that enormously, as it will allow us to expand our remarks. However, I judge that we are so anxious for the Minister to resolve our difficulties that I shall conclude my contribution.
I am delighted to try and clarify the amendment's possible implications. This has been an interesting debate, with some good points made, but many hon. Members seem to have misunderstood what is involved in the valuation process. It is to that question that I shall try to address my remarks.
Various Opposition Members adopted a partisan approach, and one accused the Government of being responsible for a "corruption of power". I assure the House that the formula is not being manipulated. Interestingly, only one accusation of that sort was made, when the right hon. Member for Suffolk, Coastal (Mr. Gummer) spoke about the allocation of health money and claimed that the pendulum had swung away from the problems of an elderly population and towards health issues. I point out that in areas where people have a lower life expectancy, in general that is due to the incidence of disease and illness. To me, that seems a perfectly reasonable criterion to govern the allocation of money. It certainly does not involve party-political bias.
The Minister has not looked at what the deprivation index covers. The real problem is that the national health service should perhaps be an ill health prevention system, but it is not. It is a treatment system, and as long as that is what it is, the treatment needs to be provided where it is most needed, which is where there are most old people. Deprivation has several other elements that have nothing to do with health.
I disagree, but I doubt that you, Mr. Deputy Speaker, will allow me to stray too far down that road—
Order. I understand the Minister's difficulty. Many issues have been raised this afternoon that were perhaps not spot on the amendment, but I trust that he will not be tempted down too many of those byways.
I shall direct my remarks to the amendment and its implications. The assumption behind several contributions this afternoon has been, frankly speaking, wrong. It concerns the fear of potential political manipulation, and it assumes that the relative increase in property prices within an area and between areas has taken place only or mainly in areas with higher incomes. However, statistics published by independent bodies show that that is not the case. In layperson's terms, the Conservatives assume for the purposes of this debate that "oop north", we are all poor and live in terraced houses. I should point out to them that Cheshire is the second richest county in the country—and a very beautiful county it is.
The second mistake that has been made is to assume that those areas that have had relative increases in prices, where a revaluation would increase the tax yield, are all under the control of the Conservative party. That is not the case. The Conservatives make the same mistake as my party made in the 1980s, which is to assume that certain parts of the country are naturally aligned with one party and parts are aligned with another. If a revaluation were to increase the tax yield and therefore reduce the resource equalisation element—the hon. Member for Mole Valley (Sir Paul Beresford) covered that point—the implication is that that would take place entirely in non-Labour areas. One could not achieve that outcome even if one wanted to, and I shall explain why. I reject the allegation about the allocation under the formula and I reject the allegation, also made by some Opposition Members, that that would be used in a politically manipulative way.
The Government will ask the House not to support the amendment. I was a little confused when I saw the amendment, but I now have a much clearer understanding of what the hon. Gentleman is trying to achieve. He gave the example of a particular area in the country, but Madam Deputy Speaker ruled it out of order, so I shall not repeat it—but it is by a big river in the south-east of England. The hon. Gentleman seemed to think that all the new properties that are built in that area will be revalued when they are first sold, and that therefore it is necessary to have a local valuation of the existing properties. However, the new properties will be valued and allocated to council tax bands, based on the values of the antecedent valuation date of 1991, the same date at which all properties in the country continue to be valued.
If there were to be a subsequent resale of those properties, they would be revalued only if they had been significantly improved, for example, by the addition of a swimming pool, but perhaps not by the addition of a patio, as some hon. Members have suggested. That is the policy that has been in place since 1991. Even then—this is the crucial point—the revaluation would still be based on the 1991 antecedent valuation date. That addresses the point that was drawn to our attention by the hon. Member for Cotswold (Mr. Clifton-Brown).
As is so often the case, the devil is in the detail. I have some practical arguments about why the amendment would not work, as well as policy ones. As many hon. Members have said, at first sight, the amendment seems consistent with the policy of devolution, given the flexibility to carry out a revaluation limited to a single billing authority or a group of adjacent billing authorities if a such a revaluation is demanded locally. However, the detail shows the difficulty of the amendment's practical implications.
First, let us consider the implications for the Valuation Office Agency. Perhaps I can give the House some information that will be useful in considering the amendment. Following significant investment in modern technology, which essentially involves the computerisation of manual records, and the development of the automated valuation model, whereby a computer is given the details of different properties, it is true that the VOA could calibrate the system to cope with different valuation and revaluation dates for the billing authorities. Modern technology could allow what the hon. Member for Mole Valley suggests. However, let us consider for a moment the situation that could prevail in years to come.
As a result of the amendment, we could face a national taxation system based on multiple valuation dates and a host of different banding structures. Of course, we cannot revalue without rebanding. That is an essential point. If we assume that each valuation would involve a transitional scheme—the hon. Gentleman may want to address that point if he wishes to respond to the debate—we would be left with a hotch-potch of systems operating in different parts of the country and the confusion for the public would be too dire to contemplate.
In my constituency, which is adjacent to the border with Wales, the situation that the Minister describes already exists. There is a different system in Wales, where a revaluation has already taken place. Many of my constituents already face such confusion because there is a different system on each side of the River Wye. The systems on either side of the border differ under this Government.
I appreciate that point. I thought of it myself when I was preparing for the debate last night. As the hon. Gentleman knows, the difference is caused by devolution, but the answer can be drawn out by considering what happened when the poll tax was introduced. The amendment would allow different valuations and bandings across boundaries in the same communities. In other words, the borders of Wales and England are well known and understood. Huge confusion was caused by the difference between one side of Narbonne avenue, which is in Lambeth, and the other side, which is in Wandsworth—I think that that was the boundary—and the danger of the amendment is that such boundaries would be drawn not just in communities and neighbourhoods, but along streets.
Is not the real confusion created by the different rates that are levied, rather than by the base on which the rate is levied? That will always be the case, so the Minister's argument does not work.
The hon. Gentleman says that that will always be the case, but if he were to read the 1992 Act and, more importantly, the Hansard report of the debates on that legislation, he would understand that an essential part of resource equalisation—the notional effort made by banding to equalise the system—would not be possible, so the amendment would throw out the baby with the bathwater. There would thus be a confused situation with different banding systems operating in different billing authorities. If the hon. Gentleman stays with my argument, he will understand the position.
Perhaps I should have explained a little more clearly that I thought that the power would be used in relatively isolated cases and that it would still be maintained by the Secretary of State, which my right hon. Friend the Member for Bromley and Chislehurst (Mr. Forth) would perhaps deplore. However, local people would feel a difference if the revaluation were reflected in the assessment of ability to pay in the funding formula. If that were changed, the difficulty that the Minister cites would be offset.
I understand the hon. Gentleman's point and assume that that is why the amendment provides for groups of billing authorities. If he will allow me to stick with my argument for a moment longer, I hope that he will understand why the amendment is not workable.
The hon. Gentleman argued that such small-scale revaluations could help with the costs of revaluation, which the hon. Member for Christchurch (Mr. Chope) also mentioned. Taken in isolation, he is, of course, right, but taken in aggregate, across all the many different revaluations that could ensue, I believe that he is mistaken. There is a widely accepted theory that economies come from scale. Under national revaluation, even with the automated valuation model, that is still the case. The VOA could gear up to deliver one national revaluation and would calibrate its software with one valuation date in mind in such an event before revaluing in one concentrated effort.
The fact that any revaluation creates winners and losers has not yet been mentioned. Those who are losers will call for transitional arrangements under section 79 of the Local Government Act 2003. Does the Minister agree that it is almost certain that such revaluations would trigger transitional arrangements?
I mentioned briefly my assumption that a transitional relief scheme would be needed in such circumstances, as was the case when the poll tax was abolished and the council tax brought in. That was also the case with the business revaluation, which proved to be successful and did not cause the controversy of the Welsh revaluation.
Under local or local area revaluations, the VOA could be faced with a constant cycle of recalibrating, revaluing and publishing draft lists, and then providing compiled lists to individual billing authorities. That would inevitably lead to more costs and, in the long term, the use of more staff resources.
Let me turn to the impact that the amendment would have on the finance settlement and the grant distribution system. Imagine for a moment a scenario in which one billing authority was revalued. Let us say that in that case revaluation led to a reduction in its overall tax base because properties, on average, moved to lower bands—hon. Members have cited examples of circumstances in which that could happen. At the outset, that appears to be entirely desirable for the householders concerned.
The expectation would be that the grant distribution system would compensate the billing authority for its reduced tax base by shifting a larger proportion of the overall grant pot into that area. However, we encounter a problem at that point because the grant pot is of course finite. Without another authority revaluing and increasing its tax base at the same time, which would effectively rebalance the whole system, we would not have the extra funds that would be needed. Everyone else would thus get less, effectively on the say so of the authority concerned.
Without any compensation through the grant distribution system, the billing authority would be faced with two options: either cover the deficit through efficiency savings or service reductions; or increase its tax rate, which would effectively mean asking its council tax payers to pay the same amount of council tax overall as they did before the local revaluation ever happened. Any overall benefit from revaluation would therefore be cancelled out. On the other hand, a billing authority with an increasing tax base going through a similar revaluation would be handed a windfall increase in tax yield, which would be left unadjusted until the next three-year settlement period.
We have gone on record on many occasions saying that we accept the case for revaluation and that it is right to maintain a fair alignment between house prices and council tax bands. The amendment implies that it might be right to realign one subset of properties while leaving all the others unaligned, but how can it be fair that one person benefits from a reduction in band through a revaluation while their neighbour, who happens to be in a different authority that is not revalued, does not? As some speakers noted, we would be faced, I fear, with a flood of appeals as the public became increasingly concerned and confused by the ensuing unfairness.
The amendment appears to be based on an assumption about the factors influencing the housing market—an assumption that is fundamentally flawed. It is that influences on the market could—indeed, must—operate at a local level in isolation from national factors. Why else would we ever conceive that revaluation could be justified in one billing authority separately from all others? Micro-economic factors play their part, but to revalue only on the basis of such factors would destabilise what is, after all, a national tax system based on relative values across the whole housing market.
My major concern is the enforced growth imposed by the Government themselves. If the Government enforce growth, they should at least give the local authorities affected the ability to have a say in revaluation and its timing.
I answered that point when I said that valuation was based on an antecedent valuation date of 1991.
There is a wider policy at stake. The right hon. Member for Suffolk, Coastal said that he was against growth areas, and other speakers complained of a problem because of increased house prices. The argument that revaluation is needed has arisen from the increase in the differential between earnings and house prices that is caused by the excess of demand over supply, which is precisely why growth areas have been proposed.
I am prompting interventions, but we have more amendments to deal with and Third Reading to come. Perhaps right hon. and hon. Members can make their points then.
The Minister did mention my speech.
I give way to the right hon. Gentleman.
I rise to correct the Minister. I did not say that I am against growth; I said that I am against piling growth into the south-east of England instead of spreading it over the whole of the United Kingdom when modern techniques of transport and IT make that possible.
I understand that the right hon. Gentleman said that. I muttered across the Chamber to the Liberal Democrat spokesman that I was not sure that local people in the right hon. Gentleman's constituency who wanted to buy a home in the area would necessarily agree with that point. Of course they are welcome to move to Oldham and Saddleworth, but I have to point out that house prices in some parts of my constituency are as high as, if not higher than, prices in his. It is not true that all housing growth areas are in the south-east, or that the relative increase in prices has occurred exclusively in the south-east, yet that was the assumption implicit in many of the speeches made by Opposition Members this afternoon. I am more than happy if they continue to make that assumption, because it does them electoral damage.
I conclude my remarks on the amendment by asking the House to reject it. I thank the hon. Member for Mole Valley for tabling it because it has allowed us have a clearer debate on the purposes of revaluation and the methods involved, but I hope that he understands that his proposal has the potential to create significant problems for local government finance and the operation of the council tax system.
I thank the Minister and all Members for the support—mixed support. We have had a substantial discussion, much more so than I anticipated, and the spread of knowledge of local government finance has been incredible—from next to nothing to absolutely everything. As my right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer) pointed out, the subject is difficult for people to understand. Clarity is needed, and that was part of the inspiration behind the amendment. The difficulty, however, is that because of the wording of the Bill, the amendment had to be very tight. I could only touch on some of the consequential effects and answer them in a way that would enable the amendment to be carried forward. I shall study the amendment and the Minister's comments carefully, and we can return to the matter another day. For the moment, I beg to ask leave to withdraw the amendment.
Amendment, by leave, withdrawn.
I beg to move amendment No. 4, in clause 1, page 1, line 8, at end insert—
'(1B) The Secretary of State shall decide at least once in each calendar year whether to exercise the power granted by subsection (1A), and shall give reasons for his decision.
(1C) The reasons referred to in subsection (1B) shall include, but shall not be restricted to, the Secretary of State's assessment of the degree of divergence in relevant property values since the original valuations made under this Act or since any subsequent revaluation.'.
The amendment is about giving reasons, and its origins lie in the different reasons that various people have for being in favour of the Bill. Our reasons are simple. Since we will replace council tax with a different tax system altogether—local income tax—we have no need of any revaluations, and therefore believe that any expenditure on revaluation would be wasted.
There is more dispute about the Government's reasons for introducing the Bill. Their stated reasons are to do with the expansion of the remit of the Lyons review, but even Sir Michael Lyons said that a delay of only one year would be justified by the extension of his remit to function rather than just finance. In any case, there is no obvious connection between Lyons and revaluation, since Lyons has been told that council tax is Government policy—the Minister repeated that in Committee—so I see no reason to stop work on a revaluation as council tax will continue, under the Government's policy, to be the central tax for local government purposes after the review.
The addition of structural change to the remit of Lyons and the announcement of a White Paper that includes structural change make no difference, as far as I can see. I welcome the announcement of a White Paper, which will increase the amount of policy direction given to the Lyons review. Since council tax is Government policy and will continue to be Government policy throughout the White Paper stage and the Lyons review stage, there is no reason for them to abandon revaluation.
The second possible reason for the Government's move is the accusation that there are political reasons that explain the Bill. Throughout its consideration hon. Members in all parts of the House have pointed out that the problem with revaluation is that the political costs almost always outweigh the technical merits of conducting one. That is true even of this revaluation. The New Policy Institute estimated that under the revaluation as proposed for 2007, the winners would outweigh the losers by 5.5 million to 3 million. The trouble with that is that in such exercises the winners tend not to be very grateful, as they think they have been overpaying for many years, whereas the losers are furious, so the political cost is always very great.
There is a rather less cynical reason contained in the New Policy Institute's analysis of the possible reasons for a revaluation, and that is a reason of fairness—the revaluation would tend to benefit better-off people in some areas of the country at the expense of worse-off people in other areas. That is not a simple north-south divide, as some people think, but a geographical change and a change in the distribution of wealth and income that would be adverse. The problem of the unpopularity and the unfairness of revaluations is confirmed by the history of revaluations that the right hon. Member for East Yorkshire (Mr. Knight) partially recounted in his remarks on the previous amendment. He did not get to the last example, when the threat of revaluation caused the poll tax, which is perhaps the most impressive error ever committed in the history of local government finance.
A third possible reason to support the Bill is that property values have not diverged significantly. Until about 2001, property values diverged throughout the country, which was followed by a convergence, but in itself that is not enough to explain calling off revaluation, because the subsequent convergence has not yet outweighed the previous divergence. If we take property values in 1991 as a base and count that as an index of 100, London was at 557 in 2004, whereas the north-west was at 466.5. Although there has been convergence in property values since about 2001, it is not yet sufficient to outweigh the previous divergence.
As the Minister said several times in previous debates, in particular areas of the country convergence and divergence do not follow the regional pattern. Is that the reason why the Government have introduced the Bill? The problem is that the Government refuse to take that point. Before the Bill was introduced in the autumn, they had not commissioned a study of divergence or convergence in property values. There is a lack of clarity on why the Bill was introduced.
The amendment's purpose is not to decide the debate about what has happened in the past or to explain why the Government have introduced the Bill, but to put any future debate on the same issue on to a more rational and informed basis. The amendment states that the Government must give reasons for not only going ahead with a revaluation—if they decided to go ahead with a revaluation, one imagines that they would be keen to give the reasons why—but a decision to decline to go ahead with a revaluation. We believe that that would help Parliament and the public distinguish between technical reasons and other reasons for a decision not to go ahead with a revaluation.
The amendment also states that the reasons that the Government give must include a statement on divergence in property values, but it would not require them to state only their view on divergence in property values. The point is to obtain the Government's view of what the divergence has been and of what level of divergence would be intolerable, given the other possible factors.
We moved a similar, although not identical, amendment in Committee, where a number of reasons were given for opposing it. The Minister said that the amendment appeared to require an objective view on when divergence in property values is enough for a revaluation, but that was not its purpose. It was designed to seek not an objective view whether divergence has become too much, but the Government's view of when divergence has become too much.
Does the hon. Gentleman have any worries about the cost of that part of his amendment? If we are to have an annual statement by the Secretary of State giving reasons, and if, by implication, there will be an annual assessment of the degree of divergence, the exercise could be very costly.
I was about to come to that point.
The second objection mentioned in Committee was that the amendment implied that divergence is the only reason why a revaluation might or might not proceed, but that is not what we are saying. We are saying that divergence is one reason that must be dealt with in the debate, whether or not the Government think that it is their central reason.
The third point concerned cost, which the right hon. Member for Bromley and Chislehurst (Mr. Forth) mentioned. It was said in Committee that there would be a cost in officials' time. However, the figures are generally available from the Land Registry and from the series maintained by the Halifax building society and by the Royal Institution of Chartered Surveyors. There would be no great cost in compiling the figures, but it would involve a good deal of effort from Ministers in constructing their reasons based on the information available to them. That is not an unreasonable burden for the political heads of Government Departments to bear in the interests of greater openness.
I do not want to detain the House any further. The amendment is a proposed addition to the Bill from a party that is generally friendly to it. It would increase transparency and allow us to have a better debate, were these questions to arise again, than we have had on this occasion.
The Liberal Democrats' amendment would require an annual decision to be made, with reasons, on whether a revaluation exercise should be undertaken, with an assessment of the divergence in property values. Such an undertaking would involve enormous cost and administrative time. Conservative Members oppose the amendment.
As the hon. Member for Cambridge (David Howarth) said, the amendment is similar, although not identical, to the one that we debated in Committee. The Government's position remains the same. Let me emphasise that the Bill obliges the Secretary of State to come before the House at the time of a revaluation date and subject the order to debate and, no doubt, a vote. I assure the House that that will give it the opportunity to consider and challenge his reasons.
The amendment has been slightly reworded to make it clear that the duty on the Secretary of State to consider at least once each year whether to set a date for revaluation and to give reasons should include, but not be restricted to, an assessment of the degree of divergence in property values. Not least because it still refers to an assessment of the degree of divergence, I ask the House to oppose it if the hon. Gentleman wishes to press it to a vote.
Although we readily accept the argument for a revaluation of council tax to maintain a fair alignment between house prices and council tax bands, we can see no case for the regular publication of statements. When we debated the similar amendment in Committee, it received no support from the official Opposition. Indeed, the hon. Member for Poole (Mr. Syms) said that he was not sure that it would be terribly helpful and that it was probably unnecessary. I would go slightly further than that. The mere fact that there would have to be a statement at least once a year would undoubtedly stir up excitement and controversy among hon. Members, particularly Opposition Members, the press and the general public, and that would in turn lead to considerable uncertainty and anxiety for council tax payers.
Even more of a problem is the specific requirement for an assessment of the degree of divergence in property values. Whatever the hon. Gentleman may say, that would simply encourage the view that there must be some sort of objective "golden rule" that would lead, or even require, the Secretary of State—or anyone else—to determine whether a particular level of divergence justified a revaluation.
I appreciate that the hon. Member for Cambridge said in Committee that the similar amendment that we considered there did not assume the existence of any such golden number. He also said that he and his party were not trying to get an objective view of the conditions for revaluation. However, publication of the sort of assessment that he envisages would inevitably encourage people to think that if, for example, X per cent. of houses in band Y had increased in price by more than Z per cent., there would be a case for revaluation more or less automatically. Furthermore, they would infer that, if the Government then decided for whatever reason not to proceed with revaluation, notwithstanding that evidence, they would somehow be flunking the issue. Conversely, it would be inferred that, if a specific level of divergence had not been established, an insufficient case would have been made for revaluation.
The Government reject the notions that a specific level of property price movement necessarily justifies revaluation and that divergence that falls short of that level of property price movement precludes any case for it.
The main point of the amendment is to encourage the Government to be consistent from one year to the next so that the reasons they give one year are not contradicted the following year. Those reasons do not have to constitute an objective rule but they should be consistent over time.
I understand the hon. Gentleman's point. I believe that the provision to require the Secretary of State on the appropriate occasion to justify his or her decision or proposal to the House is sufficient. I stress that I studied the points that he made in Committee after that debate and that I understand them, but I believe that the amendment would inevitably lead people to conclude that there must be a golden rule.
Revaluation is not simply about reflecting divergence in prices across the property market. The case for revaluation is simply to ensure that property values are fairly reflected in council tax bandings and that values are up-to-date and can be sensibly handled by the Valuation Office Agency and other interested parties.
Above all, we are interested in fairness but it does not depend on passing some sort of arbitrary test on the level of divergence. Indeed, if the focus were to be too heavily weighted towards divergence as the overriding factor predicating a revaluation, according to the amendment, a virtual annual revaluation of all properties would have to take place in order to assess divergence.
I agree with the hon. Member for Upminster (Angela Watkinson) about the resources implications. The assessment would have to consider not only the national but the regional and local picture to reflect the fact that divergence can and does happen, and has an impact at the micro level—the billing authority level—as well as regionally and nationally.
I have no doubt that many individual householders would be tempted by the process to enter into some sort of annual debate about whether the Government should revalue that particular year according to whether they would win or lose—the hon. Gentleman mentioned winners and losers—by that specific set of figures. That would not offer any prospect of a sound basis on which to make the important decision of when to revalue.
The right way forward is for the Government, in the light of the Lyons inquiry and our response to that, to propose and justify a date for revaluation to Parliament, and for Parliament to consider the merits of the date and the justification by the process of debating the affirmative order for which the Bill provides. On that basis, I ask hon. Members to oppose the amendment if the hon. Gentleman pushes it to a Division.
The amendment has a superficial attraction. If one reads it quickly and not too deeply, it sounds rather good, especially to those of us who would love Secretaries of State to come to the House as frequently as possible to give an account of themselves. Goodness knows, some of them do it little enough. However, on reflection I am not sure whether the amendment would work in that way. On what basis would the Secretary of State report after having made the decision? How would the reasons that the Secretary of State would be obliged to give, under the amendment, be communicated to the House? You and I can bet, Mr Deputy Speaker, that it would not be through an oral statement, because these days we have the trendy new process, which was sold to us as an improvement, called the written ministerial statement. More and more ministerial statements are smuggled on to the Order Paper in written form, which means that nobody can question them. I can predict with absolute certainty that that will be the vehicle chosen by Secretaries of State to fulfil the requirements of the first part of the amendment.
One immediately runs into a difficulty. If I thought that there was any way of getting any Minister to come to the House, give a proper account of himself and be questioned, I would be all for it. I would not mind if the House spent almost all its time questioning Ministers on this and that—it would give us less time to pass increasingly silly Bills from the Government and elsewhere. I have no objection in principle to mechanisms whereby Ministers must come to the House and give reasons, but that is not what the amendment says. It leaves unspecified the way in which reasons would be given to the House for the decision taken once a year.
My right hon. Friend refers to once a year, but does he accept that, if we read the amendment carefully, it will be possible for the review to be done in December of one year and in January the following year, thereby negating the whole purpose of it?
That would be possible. As my hon. Friend and I know, when one drafts such an amendment, one must try to think through all the possibilities.
That point is dealt with by using the term "calendar year". I do know what I am doing when I am drafting.
I am not sure that that answers my hon. Friend the Member for Christchurch (Mr. Chope), but we should not get bogged down as it is not the most important aspect that we should consider.
In relation to subsection (1C), we must confront the issue of cost, which the Minister raised. If we read the subsection quickly, it does not sound too bad, but its reference to
"the Secretary of State's assessment of the degree of divergence in relevant property values since the original valuations made under this Act",
gets us into difficult territory. If the exercise is to be meaningful, the information will have to be comprehensive and accurate, and one is immediately confronted with the problem of the mechanism and the cost of doing that because, otherwise, it would be extremely counter-productive. The Minister rightly pointed out that we are talking about national, regional and, I presume, local variations, all of which would have to be covered to make the provision of any use. That cannot be done without cost.
It is one thing to wave one's hand and say that the job can be done with existing staff, but I am not sure that that is the case. Under the amendment, a mandatory annual exercise would require an annual assessment of the degree of divergence in relevant property values—
I will help the hon. Member for Cambridge (David Howarth), who is speaking from a sedentary position, and get him into Hansard again, thereby making his long afternoon worthwhile. He seems to think that the word "relevant" solves the problem. I am not sure that it does. It raises a host of other questions as to what would be relevant. Perhaps he would like to tell us what is in his mind when he uses the word "relevant". He said that he was a superb drafter of amendments, so I shall give him the chance now to demonstrate that skill.
That would be a question for the Minister.
So the hon. Gentleman will now touchingly trust the Minister to interpret the words in his amendment. Perhaps the Minister will tell us what would be relevant.
Were price divergence the criteria, the relevant property information would include every property, which, I presume, would involve a national valuation exercise every 12 months.
This might be a little moment in parliamentary history. We have had the hon. Member for Cambridge proposing an amendment to the House without knowing what his own words meant. He then told the House, through me, that he would trust the Minister to interpret the amendment, and the Minister immediately obliged us by telling us from the Dispatch Box what it meant. This is an exciting development in parliamentary procedure.
Now that the Minister has said what is in his mind he can be held to account for it, which he could not be previously.
This Minister has obliged us with his interpretation of the hon. Gentleman's amendment, but that will be relevant only for as long as this Minister is in post, which we all hope will not be terribly long. In any case, this Minister is exercising powers presumably delegated to him by his Secretary of State to give his interpretation, but we do not know whether the Secretary of State agrees with it. Until we can tease out from the Secretary of State whether the Minister's view is the departmental view, I am not sure that we are any further forward.
The Minister cannot have views that are separate from those of the Secretary of State; the right hon. Gentleman suggests a constitutional enormity.
I am not sure that in this Government such constitutional certainty applies, but I shall not be tempted into that subject, Mr. Deputy Speaker. I know you well enough to know that you would prevent me from doing any such thing.
Let us assume that we all now know what "relevant" means. The Minister has helped us. He said that in his view—and the hon. Member for Cambridge has told us that that is the only view that matters at this stage—for this purpose the relevant property values are every property in the kingdom. We now know the scale of the exercise with which we are confronted—to fulfil the requirements of the amendment, a gigantic bureaucratic exercise would have to be undertaken every year. Why? So that the Secretary of State could slip a little written ministerial statement on to the Order Paper giving the reasons for his decision on whether there should be a revaluation.
I am not sure that that takes us much further forward. All too often, that is the trouble with amendments that are supposed to add value. I am not talking merely about technical faults or drafting errors, which are entirely forgivable as we do not all have the resources behind us that the Government have. And, goodness knows, even when the Government try to draft a Bill these days, they end up having to make hundreds of amendments due to errors here and there. We are simply talking about the efforts of humble Back Benchers who try to improve Bills with amendments such as this one yet, sadly, on this occasion the amendment does not pass muster.
I cannot claim to have analysed the amendment in great depth. I merely glanced at it, but if I can identify such a degree of deficiency by that superficial approach, goodness knows what would happen if we had the time—alas, sadly, we do not—to look at it in any depth or at any length. This is but the briefest analysis.
When I read the amendment I wished I had tabled one of my own. It would have been more interesting, and probably more relevant, if instead of the Secretary of State initiating the process and carrying it through, some impartial body, detached from Government, could have been charged with that responsibility. We are in an era—are we not?—of quangos, NGOs and all the other acronyms that are supposed to give a view different from Government. I have doubts about that, as usually if bodies are Government-funded their view is not terribly different from the Government's. However, if we used that approach, we might at least be able to rely somewhat more on the process outlined in the amendment.
All in all, I am not terribly impressed with the amendment. I am not very taken with it, and if the hon. Member for Cambridge is rash enough to try to put it to a vote I suspect that he may find that he has embarrassingly little support.
I have heard no reasons of substance, as opposed to superficial analysis, to make me change my mind about the wisdom of the amendment. I shall, therefore, press it to a vote.
Question put, That the amendment be made:—
The House proceeded to a Division.
I ask the Serjeant at Arms to investigate the delay in the No Lobby.
On a point of order, Mr. Deputy Speaker. May I draw your attention to an announcement on the website of the Office of the Deputy Prime Minister? It states that the Deputy Speaker of the House of Commons has announced in Parliament that the statements on the provisional 2006–07 and 2007–08 settlements will be made on 5 December by the hon. Member for Oldham, East and Saddleworth (Mr. Woolas). I am confident that you made no such announcement today, and nor did any of your colleagues. What worries me is that the office of Deputy Speaker might be sullied by the squalid manoeuvrings of the ODPM. Is there anything that you can do to direct the Minister to change the website forthwith?
Further to that point of order, Mr. Deputy Speaker. We have already had some confusion this afternoon, when the right hon. Member for Suffolk, Coastal (Mr. Gummer) referred to the Deputy Speaker as the Deputy Prime Minister. It seems that a mistake has been made and I will correct it immediately. The website should of course refer to the Deputy Leader of the House, who made the announcement during business questions—hardly the secret slipping out of an announcement.
I am grateful to the hon. Member for Somerton and Frome (Mr. Heath) for drawing the House's attention to this error. I had no idea that my influence stretched so far. At the end of a busy parliamentary week, perhaps we should content ourselves with the thought that to err is human, to forgive is divine.
On a point of order, Mr. Deputy Speaker. This is emphatically not the end of the parliamentary week because as you well know, important legislation will be before the House tomorrow. I am sure that all Members present will be present tomorrow for that important work.
I am grateful to the right hon. Gentleman. I perhaps slipped into the thought that it is drawing to the end of my parliamentary week. The House's arrangements are good enough to allow one Deputy Speaker not to be on duty on a Friday. I know that, as ever, the right hon. Gentleman will be assiduous, as will other Members.
Order for Third Reading read.
I beg to move, That the Bill be now read the Third time.
I can assure you, Mr. Deputy Speaker, that your influence reaches to the very heart of the Office of the Deputy Prime Minister.
This is of course not the biggest Bill ever to come before this House, but its provisions are important to the future of local government in England. That importance derives from the time and space that they give us to allow Sir Michael Lyons to complete his inquiry into local government function and funding. The Bill also enables the Government and Parliament to consider his recommendations properly. We will be able to consult on them and debate them fully before we move forward with a reformed council tax system and the revaluation that follows from that.
We debated the Bill extensively on Second Reading—
Order. I am sorry to interrupt the Minister, but perhaps the hon. Member for Alyn and Deeside (Mark Tami) could conduct his business arrangements outside the Chamber, if he is not taking part in the debate.
Thank you, Mr. Deputy Speaker.
We also had some interesting exchanges in a short but nevertheless productive Committee stage. Sadly, however, the sensible debate in the House of the principles of revaluation and the relative merits of different timings—and indeed of local area revaluations, the subject of the amendment moved earlier by the hon. Member for Mole Valley (Sir Paul Beresford)—has been in contrast in recent weeks to a stream of the most ridiculous misinformation and scaremongering promulgated through certain sections of the popular press.
It is sad, Mr. Deputy Speaker, that I have to inform you and the House that I am told by the Valuation Office Agency that those stories have given rise to serious concerns amongst agency staff. They are worried that, in going about their legal business and carrying out the duties given to them by the House—and by the Opposition when they were in power and introduced the Local Government Finance Act 1992—they may face verbal, and at worst physical, attack by members of the public. Perhaps not surprisingly, in the circumstances, those members of the public have themselves been fired up and worried by ridiculous stories about allegations of snooping and invasion of privacy.
Will the Minister give some examples of incidents of physical or threatened abuse?
I took care to say that the stories have led VOA staff to fear such attacks, but I will give examples of intimidation in a moment. For example, my officials have received calls from worried householders, most recently an 84-year-old gentleman. He had read the confused and confusing stories and wanted to know why "inspectors" would be coming to his home, forcing their way in and taking photographs of his bedroom and personal belongings. One article said that those photographs would be given to burglars to help them target properties.
In all conscience, I cannot allow this situation to remain unchallenged. With your indulgence, Mr. Deputy Speaker, I should like to attempt to put the record straight once again, for the benefit of the House, of members of the public who take such misinformation to be true, and of VOA staff who are daily faced with the consequences of these grossly unfair and misleading reports.
The Minister will accept that most hon. Members who understand this matter know that what he is saying is correct. Does he agree that the problem may have more to do with journalistic licence than with statements made by hon. Members?
Order. Before the Minister replies any further on this point, I must remind him that, although I understand what he is anxious to do, an amendment on this matter was ruled out of order. On Third Reading, we should concentrate on what is in the Bill, and not on what might have been in it.
Thank you, Mr. Deputy Speaker. I hope that you will allow me to give the hon. Member for Mole Valley the assurance that he asked for. I deliberately said in my opening remarks that we had had a sensible and principled debate as the Bill made its way through the House.
The Bill does three things, and three things only. It effectively postpones the 2007 council tax revaluation exercise. Despite the confused messages coming from Opposition spokesmen and spokeswomen, we are postponing revaluation. We have made it clear that we do not believe that it will happen in the lifetime of this Parliament.
The Bill removes the requirement for subsequent revaluations to take place at intervals of no more than 10 years. Finally, it gives the Secretary of State power to set the date of revaluations by order, subject to affirmative resolution in the House. That is all that it does. There are no proposals for new powers for VOA staff. Indeed, the existing powers to carry out inspections have been in place since before the second world war and were affirmed in the Local Government Finance Act 1992. One of the reasons why those powers exist is to help the VOA to stop people avoiding paying their tax.
Many of us feel that a property-based tax for local government purposes has some positive advantages, but one difficulty with the vague way in which the Minister approaches the issue—we do not know whether there will be a revaluation—is that it could make one suspect that he is sliding away from a property-based local government tax.
I thank the hon. Gentleman for that intervention, because it gives me the opportunity to say again in the House that the Government's policy is to postpone, not to cancel, the revaluation. The property-based council tax is the basis of the review by Sir Michael Lyons and I referred again to the desirability of reforming the council tax system and the measures that go with it.
The important thing to recognise is that the staff and contractors of the Valuation Office Agency have no powers to forcibly inspect a property for council tax valuation purposes. The VOA does not forcibly enter people's homes—it does not have either the legal power or the desire to do so. For a member of the VOA to take photographs of the inside of a property would be extremely rare and it would only ever be done with the express permission of the householder. In fact, the VOA has clear guidance for its staff about on-site inspections. It expressly states that photographs can be taken only with the permission of the householder, and must not show people, details of security systems, or valuable possessions.
The basis on which property is valued for council tax purposes is the same now as it was when the council tax was introduced. The VOA seeks to assign a market value based on the variables that operate in the market. If one property has a scenic view and another overlooks a chemical plant, it is likely that the one with the scenic view will attract a higher relative market value than the one with the view of a chemical plant. There is nothing new or surprising about that. If one property has an attribute that leads to its market value being higher than its next-door neighbour, it is only fair that that should be reflected in its banding. This has always been the case and nothing has changed since 1992.
As I mentioned in Committee, the fact that the VOA is capturing property attributes in a database using codes does not indicate some sinister, new, Big Brother database. It is simply the most effective and efficient way of capturing data in a form that can be used by the valuation model to come up with a fair and justifiable valuation, on computers, rather than on paper. That process has previously been done manually by a valuation officer. I recall that estate agents had to be hired quickly to ensure that the council tax could be introduced to replace the unpopular poll tax. The only difference now is that the valuation officers have the benefit of modern technology to support them in their task.
I wish to use this opportunity to reassure hon. Members and members of the public—I hope that they have paid attention to the debate or will read the reports of it—that suggestions that people who are unable to pay their council tax will be sent to prison are not true. People who wilfully refuse to pay may be imprisoned under powers that have existed for many years, but that is entirely different from the position of someone who is unable to pay. Nobody has ever been jailed for being unable to pay, nor would they be.
Only last weekend, at the very time that winter fuel payments and £200 cheques for pensioners' council tax rebates were landing on the doormats of millions of pensioner households, there were stories touting a survey about the impact of council tax increases on the elderly. That survey was mentioned by the hon. Member for Christchurch (Mr. Chope)—incidentally, he was the Under-Secretary who introduced the poll tax in the late 1980s—and by its own admission, it excluded council tax benefits and rebates for the elderly. I should say in acknowledging the point made by the hon. Member for Mole Valley that the reports of that survey have led to yet more anxiety among the elderly.
The Government have already said that we will use our capping powers against councils with excessive council tax increases and budgets, as we did this year and last year. I give that reassurance to those who may be anxious about council tax.
Almost 2.5 million people aged 60 or over now receive council tax benefit, which provides a rebate of up to 100 per cent. of their bills. In addition, £100 was given to households with someone aged 70 or over in 2004–05, to help them with their council tax bills. For 2005–06, households with someone aged 65 or over are receiving £200, which is paid with the winter fuel payments unless they are already entitled to a 100 per cent. council tax rebate.
Will that payment continue in future years?
We will have to wait and see. When we consider council tax bills, we must bear in mind the council tax benefit and rebate system to get a fair picture. We can then debate the policy on the basis of the facts, not false assumptions.
Finally, I do not understand why Conservative Members continue to undermine the council tax, when the Conservative party introduced it and when they have no alternative tax policy—yet they campaign to seek to undermine it every week. I hope that we can have a proper debate and dialogue based on the facts of the Bill and recognise that the council tax system has received support from both main parties since it was introduced. I commend the Bill to the House.
The Bill is very narrowly drawn, but it enables the Government to delay revaluation and to choose when it will take place in the future. It has aroused some very strong feelings in the debates this afternoon. This debate on Third Reading is the last opportunity for hon. Members to raise their concerns and put them on the record.
The Minister's first major decision after taking up his post was to put off the revaluation and refer the issue to the Lyons inquiry—much to the dismay of his predecessor, the right hon. Member for Greenwich and Woolwich (Mr. Raynsford). The Government have essentially ensured that the revaluation will not take place before the next general election. So this is not goodbye to revaluation but au revoir, and the British people are highly likely to face a revaluation that significantly increases their council tax bills sooner or later, unless they show their disapproval in the ballot box at the next general election.
Amendment No. 3 sought to introduce local revaluation, and we had a long and interesting debate that raised more questions than it answered about the great complexity of revaluation and how to make it fair.
As hon. Members know, the level of council tax is one of our constituents' main concerns, and it occupies much of our time in correspondence and advice surgeries. That makes council tax one of the most explosive political issues that the Government face. Bills have already increased by 26 per cent. since 1997. As one person said to me only today:
"I feel as though Dick Turpin raids my bank account every week".
It was noted on Report that the value of a property is not always a reliable indication of ability to pay. I am sure that the Minister and other hon. Members know of examples of people who are cash poor, yet live in valuable properties. Elderly people, such as surviving spouses, may remain in a family home that has risen in value over the decades, although they have a modest disposable income. However, four working adults might live in a more modest property, so the value of a property is not always a reliable indication of its residents' ability to pay their council tax.
The Bill will postpone the revaluation of properties for the purpose of council tax that was to have occurred on 1 April 2007, with council tax bills being based on the updated valuations that year. Conservative Members oppose the revaluation, not least in the light of the outcome in Wales. The revaluation in Wales was used as a tool to increase the overall tax take, so it was a stealth tax. If a typical house in England were moved up a band, it would become liable for an extra £257 a year on top of any other changes to the council tax bills. Of the 21 million homes in England, 7 million would be moved up a band, but only 1.5 million would move down a band. The Minister is looking puzzled, so I should explain that those figures have been extrapolated from the experience in Wales.
The Bill does not go far enough. It only postpones revaluation, rather than scrapping it altogether. Approximately £60 million of taxpayers' money has already been spent in preparation for revaluation—including on a new computer system—much of which will be wasted. It is ironic that an information technology project that the Government claim is excellent will not be used for its intended purpose. It is not clear whether the cost of the reduction of 1,020 staff by June 2006 is included in that £60 million figure. Perhaps the Minister will clarify that point later.
Even more alarming to council tax payers is the worrying fact that revaluation procedures will allow inspectors to enter people's homes. It is a great pity that the amendment on that matter was not selected for consideration on Report. I do not know whether you will indulge me, Mr. Deputy Speaker—
Order. I think that the hon. Lady is verging on criticism of the Chair. I do not advise her to pursue that line.
That would be unthinkable, Mr. Deputy Speaker, but one or two hon. Members raised the subject on Report.
If the revaluation is not to proceed, why are the Government still collecting data on dwelling codes, as the Minister confirmed to my hon. Friend the Member for Meriden (Mrs. Spelman) in Hansard yesterday? What use will those data be in five years' time?
Countless people make enormous sacrifices to buy a home of their own. It often leaves them with little disposable income, so they go without holidays and other forms of leisure activity so that they can afford their mortgage payments. Such people are by no means rich, but the Government see them as the milch cow of the nation.
Improvements and maintenance must be budgeted and saved for. If the implication is that improvements to, and the maintenance of, houses will put people in a higher council tax band in the future, will we see falling general standards of upkeep as people wish to avoid paying more council tax? Some of my constituents—ordinary law-abiding people—have already expressed their concern to me about the likelihood of someone knocking on their door and demanding access. That is a worrying element of the revaluation exercise.
Under this Government, an Englishman's home is no longer his castle. The Bill will allow the Government to impose a revaluation date through secondary legislation with little debate in Parliament, although that could change the entire funding of council tax. Such a change must be carefully thought through and prepared so that we have a properly balanced tax on property and services, not simply property.
Last Thursday, in answer to a question that I put to him during business questions, the Leader of the House said that he thought that the idea of programming Report stage and Third Readings raised constitutional questions. I am not sure that I agree. A lack of strict programming of this afternoon's business might have made things much worse. During the debate on amendment No. 3, I was fascinated to see what it is like to attend a meeting of the 1922 committee, but the Bill survived that unfortunate experience.
The Minister of Communities and Local Government emphasised on Second Reading, and the Minister for Local Government repeated in Committee, that the context of the Bill was the revision of the remit of the Lyons review of local government to encompass function in addition to finance. That context has now changed and we are looking forward to a White Paper on local government which will take into account not only finance and function, but structure. I welcomed that announcement, especially as I called for a White Paper last Wednesday in Westminster Hall. I had no idea that the Government were so responsive to Opposition calls made in Westminster Hall debates. The Bill started out as a small part of a large picture and has now become a very small part of a very big picture. I hope to see a much more long-term constitutional approach to local government, rather than the short-term political approach that produced the Bill.
As we have said all along, the Bill has its uses. We stated our support for it on Second Reading and we shall continue that support on Third Reading. We support it largely because our proposed reform of local government finance would involve the cancelling of the next revaluation, for the obvious reason that a local income tax requires no property valuations of any sort. Whether the Bill is passed or not, council tax will remain a bad tax. As the hon. Member for Upminster (Angela Watkinson) said, one of the great problems of council tax is its weak relationship to ability to pay, and revaluation does not affect that much. A group of people who are rarely mentioned in our debates are tenants, especially tenants of councils or local housing associations. It is often assumed that council tax is a type of wealth tax—that it is related to the wealth of the taxpayer. In fact, for a quarter of the population that is not so and any revaluation does not affect that.
Will the hon. Gentleman reflect on what was said on Second Reading and consider the possibility of changing the way in which ability to pay is assessed, combining that with a broad-scale income assessment, and feeding it into the funding formula in place of the current banding system? The resulting tax would have the advantages in terms of collectability that council tax has because it is property based. I believe that that would blow the Liberals' suggestion out of the water.
The hon. Gentleman's proposal is a halfway house. It is technically possible—in fact, it would be part of a reform that would introduce a different sort of taxation; it would be part of the equalisation necessary for the introduction of a local income tax. However, it does not go far enough. Collectability was discussed in Committee, but a point that is often missed, although the hon. Member for Manchester, Blackley (Graham Stringer) made it, is that often the published statistics on collection assume that the tax is properly due as recorded, but if a lot of people claim falsely to be living as single people there is a lot of evasion going on that the statistics do not pick up.
I do not wish to misrepresent the hon. Gentleman, but I think he said a few minutes ago that there was very little discussion of housing association and council tenants during consideration of the Bill. May I correct him? On Report, some of us mentioned such people, not least in the context of housing redevelopment. Does he accept that some of those people at least get full or partial council tax benefit, which helps to ameliorate the effects of council tax on people in those categories?
What the hon. Gentleman says is, in part, true. Council tax benefit partly offsets the regressive nature of the tax, but the tax remains the most regressive major tax in the Government's taxation armoury, even after the use of council tax benefit.
Revaluation would probably make the council tax even more unpopular. That is presumably why the Bill allows revaluation to be called off. On the other hand, failure to revalue makes the council tax more unfair and more out of date. That sums up one of the reasons why we oppose council tax. It is simultaneously bad to revalue and bad not to revalue.
I am still puzzled by the Conservative party's position on the Bill. Conservative Members voted against Second Reading. The effect of voting against, if it had been taken up in all parts of the House, would have been to defeat the Bill. If the Bill had been defeated, the present law would remain. The present law mandates a revaluation in 2007. By contrast, when the Committee considered whether clause 1, which is really the only clause in the Bill, should stand part of the Bill, the official Opposition failed to divide the Committee. I shall be fascinated to see what they do tonight on Third Reading. I hope they discovered the error of their ways on Second Reading and have realised that others may have noticed that what they proposed was, in effect, to carry on with revaluation, which is the opposite of their announced policy.
I shall not detain the House further. We are happy to speed the Bill on its way to another place. It is a very small part of a major reform of local government finance, which we all wish to see, and we wish to see the Bill pass through the House tonight.
I declare something of an interest in an historical sense at least, having served in local government in the mid-1990s. I am pleased to follow the hon. Member for Cambridge (David Howarth), and I listened carefully to what he said. I was slightly disturbed to hear earlier this afternoon that his hon. Friend, the hon. Member for Brent, East (Sarah Teather), was not able to be with us as anticipated, because unfortunately she is not very well. The hon. Gentleman may not know that I was the Conservative candidate in Brent, East at the 1997 general election, when I fought against a chap called Mr. Ken Livingstone, who was then a Member of Parliament. I ran him fairly close—just another 16,000 little votes and I would have defeated him. Having some familiarity with the hon. Lady's constituency, I should be grateful if the hon. Gentleman would pass on my regards and, I am sure, those of all other hon. Members, and wish her a safe and healthy return to us next week.
It is a pleasure to speak shortly after my hon. Friend the Member for Upminster (Angela Watkinson), who worked in local government in Essex earlier in her career. Her knowledge of these matters was clearly reflected in the quality of her contribution a few minutes ago.
The Bill has just two clauses. It is one of the shortest that I have debated in my time in the House, but it serves an important purpose in that it delays the revaluation of properties for council tax purposes in England. In a briefing note that was produced in October, the Royal Institution of Chartered Surveyors pointed out that the proposed revaluation which was to be undertaken by the Revaluation Office Agency would have represented
"the largest exercise of its kind in the world".
As such, the decision to delay it, which the Bill facilitates, represents one of the first major post-election climbdowns by the Government—although given recent events, I trust that it will by no means be the last.
It is a truism that no one likes paying taxes, but the level of council tax, even on the existing valuations, which will run for several more years at least, is one of the major features of my constituency mailbag. That is particularly true in the spring, when council tax demands go out, and in responses from pensioners, many of whom live on relatively fixed incomes and find that their council tax bill is their biggest single monthly outlay, particularly if they have paid off their mortgage. Many people experience considerable difficulty in meeting those bills, so at least they will not face the added burden of a revaluation in the short term.
As part of the debate on this Bill has related to the subject and process of billing, I want to make a few brief points on how changes in the billing system have affected public attitudes to the spending of funds by precepting authorities. The breaking-down of components on the overall council tax bill into individual line items, such as policing and fire and civil protection, has, I think, been a positive move on the whole. It certainly tends to concentrate constituents' minds on how money is actually spent on those particular services, once they are itemised.
For instance, when I was first elected to this House back in 2001, I think that some of those items were still effectively subsumed within the overall totals. However, it is interesting to note that now that those have been broken out, constituents have started to ask more specific questions about how such itemised money is being spent. I see that one or two Labour Members are nodding in assent to that proposition.
Policing precepts, for example, have generated quite a bit of correspondence from my constituents in the past few years. Indeed, one of the reasons why I am so opposed to the regionalisation of police forces in East Anglia is that Essex has a relatively low police precept compared with other East Anglian forces, so any regional merger would probably lead to a rounding-up of precepts, which could lead to proportionately higher increases in Essex on the policing precept and thus on the overall bottom-line level of council tax. I shall say nothing more about that subject this afternoon for fear of straying out of order, Mr. Deputy Speaker, but suffice to say that people pay enough council tax in Essex as it is, without having to pay an even higher bottom-line figure to prop up unpopular reforms that have little or no public support.
I suspect that part of the Government's rationale behind backing away from short term revaluation has been the howl of protest that followed the change to the formula determining the level of grant paid to local authorities by Her Majesty's Treasury. Because between two thirds and three quarters of the eventual council tax is determined by that level of grant, however the individual properties within the local authority are banded, any changes to the formula clearly have important implications for the remaining element, which has to be raised directly by the local authority. That then falls across the council tax base, which we now know is not likely to be revalued in the short term.
I must challenge the Minister on a point that he raised on Report. Any alteration in the grant formula normally creates winners and losers, and the change, which took place a few years ago, from the standard spending assessment system to the revised formula spending share system certainly did that all right. The Minister contended on Report that there are very few specific examples where that has been a problem. I shall answer his point directly: most of the losers in the transfer of resources that took place in the switch from SSA to FSS were not exclusively, but overwhelmingly local authorities—both county and district councils—concentrated in the south-east of England; most of the gainers, although not exclusively, were urban and metropolitan authorities in the midlands and the north of England. There was effectively an important shift of resources from the south-east to the midlands and the north, which had important knock-on effects on the council tax bills subsequently levied on council tax payers.
In the year in which the switch took place, the county council precept in Essex went up by 16 per cent. in one hit, because millions and millions of pounds in grant were removed from Essex and given to Labour's friends in the midlands and the north.
Does the hon. Gentleman accept that the vast majority of deprived areas are in central London, the west midlands and the north? The resources were shifted to recognise the deprivation in those areas.
I am grateful to the hon. Gentleman for admitting that the switch took place. I am pleased that a Labour Back Bencher has been honest enough to put that on the record in the House of Commons.
The hon. Gentleman would be fairer if he acknowledged that the level of grant to Essex has increased in line with inflation or above it in every year since 1997. He can hardly say, therefore, that the increase in council tax was the result of taking away funding. He says that the Government were accused of having an underlying political motivation. That implies that all the areas that lost out on some of the funding changes, relative to what they would have received, were controlled by his party, which is not the case.
The Minister is well aware of what happened, as am I and all Members of this House. The public reaction to the change was reflected in the subsequent local elections, when the Labour party was slaughtered in Essex. I confidently predict that it will get another hiding in May.
Perhaps part of the answer is that even if the Minister is right that Essex got more in percentage terms, its proportion of the total sum available dropped, while many of the northern councils, especially in urban areas, received more money through the change to the SSA, particularly as many of the indices were subjective rather than objective and therefore able to be manipulated.
Order. Perhaps in the last few minutes of the debate we could return to the terms of the Third Reading motion.
I apologise for my hon. Friend tempting me to stray, Mr. Deputy Speaker, although I would just say, in obeying your instruction, that he is absolutely right.
We heard several good speeches on Report. My right hon. Friend the Member for Suffolk, Coastal (Mr. Gummer) made a thoughtful speech in which he raised the possibility of voluntary revaluation in certain limited geographical areas if residents wanted to be revalued for some pressing local reason. He did not give his argument a name, but I would characterise it as revaluation by consent.
During the debate on the amendment tabled by my hon. Friend the Member for Mole Valley (Sir Paul Beresford), we discussed whether, if we do eventually revalue at some point in the future, there would be any merit in running pilot revaluations in a few parts of the country to test the effects. I cannot imagine that many areas would rush forward to volunteer for that. Nevertheless, I suggest to the Minister that there might be some merit in doing it, not least to try to persuade people that the system is not bent. Whatever the Government were trying to do, a lot of the resistance arose because, given what had happened in Wales and with the grant shift, many people genuinely felt that the revaluation would not be fair. I think that the Minister would privately concede that. I make this as an entirely non-partisan suggestion.
Local government finance is the 21st century equivalent of the Schleswig-Holstein question. We have to come up with a grant formula that everyone can agree is equitable. Some people liked SSA and did not like FSS; some liked FSS and did not like SSA. It has been argued that some authorities needed more help with the process. I hope that the Lyons review will come up with an equitable formula, but if it is unable to do so, I hope and trust that an incoming Conservative Government will solve the problem.
Question put and agreed to.
Bill accordingly read the Third time, and passed.
Delegated Legislation
Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6) (Standing Committees on Delegated Legislation),
Northern Ireland
That the draft Legal Aid (Northern Ireland) Order 2005, which was laid before this House on 15th November, be approved.—[Mr. Roy.]
Question agreed to.
Estimates
Motion made, and Question put forthwith, pursuant to Standing Order No. 145 (Liaison Committee),
That this House agrees with the Report [30th November] of the Liaison Committee.—[Mr. Roy.]
Question agreed to.
NHS Dentistry (Durham)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Roy.]
I am grateful to have obtained the Adjournment debate for which I asked because I am concerned about the present and future availability of national health service dental services in Durham.
Twenty dentists in Durham provide NHS care but some of them do so only for the under-18s and other exempt cases under a personal dental services contract. All practices in my City of Durham constituency have currently closed their lists to new NHS patients. I understand that the nearest open list is at Chester-le-Street community hospital.
Problems with the availability of NHS dental care in Durham are unfortunately not new. In response to previous representations from me and my predecessor, the primary care trust agreed to employ a salaried dentist directly. That appointment was made but that NHS list is also closed, albeit temporarily.
The PCT intended to take on another salaried dentist and confirmed that in a meeting with me in the summer. In the event, that did not happen for a variety of practical reasons and the PCT does not currently have the financial resources to support it. Discussions with dentists about expanding their NHS provision are currently being held up until further details of the new general dental services contact are known.
Durham, like many commuter towns, faces a problem of the demand for dental services being higher than the size of its population base would suggest was necessary because many people who work in the city but do not live there register with a dentist. The PCT argues that that makes planning for the correct amount of dental services difficult. It also has the effect of pricing local, low-income people out of dental care because many of those who come into the city for employment can afford to be private patients.
The problem of "privatisation" has been happening for some years, with several dentists "encouraging" or forcing their NHS patients to become private ones. Sometimes lists are completely closed to NHS patients.
I am glad that the hon. Lady has secured such an important debate. When I listen to her speaking about Durham, I realise that her comments apply to Wellingborough, which suffers from exactly the same problem of dentists opting to go private. My constituents have to leave the constituency to find an NHS dentist.
Order. We cannot widen the debate by intervention. The debate, which the hon. Lady has won, is about dentistry in Durham.
I thank you, Mr. Deputy Speaker, but I have enormous sympathy for the hon. Member for Wellingborough (Mr. Bone).
As I said, several patients are forced to register as private patients. There was an unfortunate example in the summer, when a dentist gave two weeks' notice to his patients, did not inform the PCT, and told his patients that if they wished to re-register with him, they would have to do that on a private basis.
I would like the Minister of State for Health, my hon. Friend the Member for Doncaster, Central (Ms Winterton), to make some comments about how we can encourage dentists to take their social responsibilities to provide NHS care more seriously, especially as they are trained and supported by the NHS. I know that that applies only to some dentists, but I would welcome her comments on that.
I can see that the Government have taken action to try to address the problem of a shortage of NHS dentists by employing more dentists, setting and recently achieving a target of 1,000 new dentists, and I know that there are 170 extra training places this year in dental schools—a 25 per cent. increase on 2004–05. I also understand that additional capital money is being made available, and discussions are taking place about a new dental school. But those measures, welcome though they are, are not delivering on the ground for the people in Durham.
In addition to the extra resources now being put into NHS dental services, I understand that the Government are placing a great deal of faith in the general dental services contract being introduced from April 2006, which they say is a large part of the solution to current problems. Feedback from the Durham and Chester-le-Street PCT, however, does not fill me with optimism. Already the PCT has received one letter of resignation giving the reason as the introduction of the new contact. The primary care development manager has stated that she has had many discussions with dentists over the past few months and she has yet to hear a positive view of the contract.
Orthodontists are also very unhappy with the proposals relating to them. Incidentally, Durham has only one orthodontist practice, and the waiting time for treatment is currently 20 months, which is also very unsatisfactory. Anecdotal evidence suggests that once dentists receive their contract values and activity levels from the Dental Practice Board, which I understand is happening soon, most will not wish to renegotiate their NHS contracts. The majority are unwilling to commit themselves without that information.
Obviously, I find this information very worrying. Faced with a potential sudden large reduction in the amount of dental capacity available on the NHS, the PCT will need to provide a direct PCT service, but currently the PCT does not have the capacity either in terms of dentists or surgeries to be able to re-provide that service.
Patients involved in a PCT consultation exercise also had some difficulties with the new contracts. They seemed to be concerned that dentists would no longer hold lists of registered patients as there would be no long-term responsibility for the quality of care provided. They were concerned that patients might not be able to receive continuity of care.
Patients also feel that the way that charges are structured in the new contract—with a fixed price for fillings, for example, no matter how many they have—would encourage people to wait until they require a large number of fillings before visiting the dentist. That would probably apply more to those on lower incomes, creating inequality in dental care. That sentiment was also reflected in consultations with the professionals.
The PCT and the British Dental Association acknowledge that the new charging system is simpler, and that there will be winners and losers in terms of cost—those requiring one-off, more intensive treatment are likely to be the winners, and those needing regular lower-level treatment are likely to be the losers. The British Dental Association maintains that we shall need to train yet more dentists and other dental team members. It notes that demand for dentists is outstripping supply, which is why dentists are closing their books.
According to the BDA, in 2005, 15 per cent. of general dental practitioners were not taking on new child patients, 37 per cent. were not taking on new exempt adults, and 15 per cent. were not taking on new paying adults—a significant rise since 2000. It is also concerned that additional funding might not reach front-line dental services when PCTs become responsible for commissioning from April 2006.
The BDA acknowledges that the value of the private market has grown rapidly over the past 10 years and that NHS care still outstrips private practice, but it suggests that the move towards private care is prompted by a lack of investment in NHS dentistry. Evidence shows that dentists do not typically earn more in private practice than in the NHS, but that they can earn similar amounts of money while being able to spend longer with patients.
I think that it is fair to say that reaction to the new general dental services and personal dental services contracts has been mixed. More than anything, dentists appear to want a break from the treadmill so that the link is broken between treatments provided and remuneration received. The view being expressed by the BDA, however, is that under the new contracts dentists will lose the flexibility to work at their own pace but will be unable to get off the treadmill. The basis of the new system is that the contractor will complete a number of units of dental activity, set by the local PCT, in return for a set monthly payment.
Dentists are also concerned because the new proposals do not encourage disease prevention or the maintenance of good oral hygiene, as preventive care does not specifically attract units of dental activity. They are also of the view that the new system has not been sufficiently piloted before being rolled out across the country. They note that although one or two aspects of the new GDS contract proposals have been tested in the PDS agreements, the UDA output system is, they contend, as yet entirely untested. The BDA maintains that the shortage of dentists is likely to continue for some time.
I raised those more general points about the contract and work force planning matters because I should like reassurance from the Minister about the likely impact of the new contracts in terms of improving access to NHS dental services in Durham. I should like her to comment on the steps that she might take to alleviate the current unacceptable problem in Durham—that no NHS facility is available to new patients. What support will be given to PCTs directly to employ dentists if the mixed economy of dental care does not deliver enough NHS capacity post-April 2006 and they need to employ salaried dentists to achieve NHS output?
I hope that the Minister will accept that my overriding concern is to ensure that the people of Durham have a first-class NHS dental service, which reflects the Government's commitment to the NHS.
I congratulate my hon. Friend the Member for City of Durham (Dr. Blackman-Woods) on securing the debate. The topic is not only important but timely. As we speak, general dental services dentists' individual contract values are being sent to them and details of the new system of charges for patients and the regulations governing the new GDS and personal dental services contracts will be released shortly. My hon. Friend pointed out that many dentists were waiting for some of that information before committing themselves. They will now be able to see exactly what the new contract means for them. I hope that that will address many of the issues that she raised.
My hon. Friend referred to the situation in Durham and I want to touch on some of the improvements that have been made there, bearing in mind that there are still some difficulties, as she pointed out. I want also to talk about how local commissioning will give all primary care trusts assistance in developing local dental services.
As my hon. Friend rightly said, there have been severe access problems. We have tried to address them through a variety of means, including domestic and international recruitment and the expansion of personal dental services. In Durham, the PCT took various steps to deal with the problems. It appointed two salaried dentists a year ago and expanded personal dental services. In Durham and Chester-le-Street, six of the 23 practices—about 26 per cent.—are in PDS, which is close to the national average of about 28 per cent.
Will the Minister give some further clarification about the two dentists directly employed by the PCT? Only one of them is employed in City of Durham. The PCT had intended to employ two salaried dentists in my constituency, but for the reasons I gave earlier it was unable to do so.
The PCT area may be wider than that of the constituency.
The PDS practices have a combined contract value of £1.78 million, which includes growth funding of £558,000. That is new money, and it has been made available by the Department of Health to my hon. Friend's local PCT. As she said, there are problems, but those practices were treating almost 24,000 patients at the end of October. The roll-out of the new dental contracts will provide an opportunity for the PCT to look at the PDS agreements and make sure that the units of dental activity agreed with the practice reflect significant recent growth. May I emphasise the fact that the PDS contracts are pilots from which lessons have been learned? In the next few months, we will sit down with dentists to look at levels of activity under PDS contracts to see whether there is room for growth in certain areas. The PDS pilots, combined with the new guidelines from the National Institute for Health and Clinical Excellence, provide greater flexibility. For example, patients do not necessarily need to see their dentist every six months—the time between check-ups can be up to 24 months. The lesson of the PDS pilots is that there is flexibility and room for growth in certain areas. That is one of the benefits of the new system, and it gives PCTs local flexibility.
My hon. Friend's PCT received £65,000 from the £50 million that the Government made available to improve access last year. That sum funded 1,300 additional patient contracts across 10 local practices in the area. The PCT must await details of next year's budget before it makes further NHS dentistry commitments. However, I can assure my hon. Friend that those details will be released shortly, allowing the PCT and local dentists to look at the way in which local commissioning can be used for local investments. They can look at local priorities to ensure that dental services meet all local oral health needs.
I have a slight interest in our debate, although it is becoming slighter and slighter as I continue my parliamentary career. I hope that we can apply a little lateral thinking. At the moment, we look at the number of patients who are seen, contacts and so on. However, we have a mixed dental service, and patients can be treated on the national health service or privately. Dentists can offer different treatments for the same disease, but most of those treatments are available only outside the NHS. It is important that dentists remain with the NHS, because patients should have a choice as to whether they receive treatment on the NHS or privately. A treadmill system has been introduced—I know that the Minister does not entirely agree—and I urge her to reconsider the proposals and provide flexibility so that more patients can approach more dentists for NHS treatment if they wish to receive it.
I contest the notion that this is another treadmill. It is important that, under the new system, dentists can continue to undertake a mix of private, public and NHS work. The new contracts will reflect the way in which they have previously worked. We expect dentists who have recently undertaken units of activity or interventions to make a reasonable commitment to the same level of activity with the same cohort of patients, although we accept that they may undertake a mixture of private and NHS work.
My hon. Friend is concerned about access problems caused by the fact that people outside the city are registered with local dentists. That has been the case for many years, and we have no plans to replace the system because doing so would require many people to find different dentists from those to whom they have become accustomed. It is true that the system is not based on residency, but changing it could affect continuity of care for existing patients.
My hon. Friend asked what would happen if dentists did not take up the new contract. The point of the changes that we are making is this: in the past, when a dentist has left the NHS the money has returned to the centre; now, the primary care trust will retain it locally. That money must be spent on NHS dentistry, which means that more dentists can be brought into the area if there is a shortage. It can be spent on salaried dental services if the PCT thinks that appropriate, although such services usually involve community dental access centres and the like. PCTs can also commission additional services from existing dentists. The money will be there to meet local needs.
As my hon. Friend said, in the longer term we are reversing the closure of two dental schools. The British Dental Association has spoken of the need to increase the number of dentists, and there is such a need—although more dentists are registered, fewer of them work for the NHS.
My hon. Friend is right about what we hope to achieve with the new system. We have discussed with dentists the need to move away from the drill and fill treadmill and to introduce a much simpler charging system. I hope that that will result in a commitment to NHS dentistry. We want to rectify many of the problems that dentists say they have experienced with earlier contracts. Our recruitment of some 1,400 more dentists over the past year demonstrates that there are dentists out there who wish to work for the NHS, but we will continue the programme if some dentists do not want to join in our reforms.
Will my hon. Friend give way?
I will, although my hon. Friend made many points with which I want to deal.
I am grateful to the Minister. Will she say a little more about why she and her Department are so confident that the dentists will be happy with the contract? The consultation in Durham revealed that no dentists were in favour of it.
Over the past few months, the acting chief dental officer has met a number of dentists who have been awaiting further information about the contract values and the regulations that will accompany the contract. I think that there has been a certain amount of misinformation about exactly what is expected. For instance, dentists thought that they would no longer be able to have children only or exempt only lists.
The aim of the regulations that we have submitted for consultation is to ban an unacceptable practice that has been raised by many Members in the House. Dentists were saying "We will treat your children if you will register as a private patient." It will be perfectly possible in future for PCTs to say to dentists "Yes, you can have a children only list." PCTs should be able to look at what is happening locally and say whether it is acceptable. We have tried to tackle a position that we considered unacceptable. Dentists thought that none of them would be able to have those lists under the new contract, which was not the case.
One of the other issues that came up was a feeling that dentists would no longer be able to do some private work and some NHS work. Again, that is not the case. They will be able to mix the two. We must be clear that we are offering a contract under which if NHS dentists give a reasonable commitment to the NHS, they will be able to earn about £80,000 a year, and up to another £60,000 can go towards the expenses of their practice. That is guaranteed for three years, for something like 5 per cent. less activity. We are anxious to ensure that if there is room for expansion, the units of dental activity would cover it. I do not think that that is an unfair deal. Nor do I think that it is bad that we are simplifying the system of patient charges.
My hon. Friend suggested that preventive care might not be possible, but the new system of banded charges specifically allows for preventive oral health advice. That is clearly covered as part of the treatment provided, which is exactly what dentists have been asking us to do.
My hon. Friend asked about the current provision of orthodontic services in Durham, which I accept is not ideal. The strategic health authority is looking into the matter and there has been a big increase in the number of orthodontic treatments over the past few years, although there is no doubt that there are problems in some areas.
Today, the Department has issued guidance on commissioning specialist services, with particular reference to orthodontics. There is clear guidance on determining need, on targeting resources and on how to use the new contract arrangements both for general dentist practitioners and dentists with specialist orthodontic expertise. We hope that that will go some way towards relieving the problem.
I hope that my hon. Friend will be assured that we are moving forward very quickly. I accept the fact that some of her local dentists may have been anxious to know the details of the new contract and what their own contract values were, but I hope that in the coming period we will be able to show them exactly what the benefits are.
I reiterate that this is all about making the charging system simpler and taking dentists off the drill and fill treadmill. I think that it is a good deal in return for a good commitment to the NHS, and will ensure that dentists can do preventive work. That is built into the contract and the charging system. It is guaranteed for three years and it replaces the 400 current charges and the way in which dentists have been paid for those, with fixed monthly income.
I feel that that is a good deal and it goes alongside the increases in training that we have already started and the fact that we will increase dental schools. Altogether, I hope that dentists in my hon. Friend's constituency, while recognising that there are still concerns, will be able to benefit from the changes, and that patients in her area will be able to benefit as well. It is a good deal, it will be good for patients and I think that it will put an end to some of the problems that my hon. Friend has experienced in her constituency.
Question put and agreed to.
Adjourned accordingly at twenty-nine minutes past Six o'clock.