Local Government Finance Bill

Lord Deben Excerpts

Monday 16th July 2012 Grand Committee

[Lord Deben]

My Lords, I rise to say a word or two about the disablement issues; that is why I have come for this part of the Committee. It seems to me that we have not covered the point properly. We have talked about the lack of thinking in the round, but we have not talked about the fact that it becomes more important given the circumstances that we are in at the moment. My 35 years as a Member of Parliament led me to have some pretty grave doubts about some of the claims that people made. You had only to sit in your surgery to see with what tiredness they came in and with what alacrity they left, complaining about some illness or other in the mean time. It was one of those sad things and it was a real problem. The Government—perfectly rightly, in my view—have approached that, and in doing so they have reminded lots of people that some people have claimed invalidity or impairment of one sort or another improperly. The difficulty with that is that it is necessary to put things right, but that creates an atmosphere that can be extremely deleterious to people who genuinely are disabled or in real need of help.

The points that have been raised on both sides of this Committee are very important at this time in particular. It is extremely important to get the balance right and to remind people, particularly local authorities—and some still do need reminding—of the very considerable difficulties in which many disabled people live and the need for them to treat these issues with a degree of sensitivity that I am not sure is found universally. I want to look at that background just for one moment.

Secondly—and I address my noble friend the Minister very carefully—it really is time that the Government got out of their problem; and it is genuinely a problem of all Governments. After all, the Government are telling everybody, rightly, that we should have joined-up thinking. We have pathfinder operations to try to get people to have joined-up thinking about property locally, local councils and government property and to try to get various organisations to work out their problems together. So we have a Government very keen on reminding people about this, and yet they still have not dealt with the central issue that we still have silos when it comes to this kind of issue.

I am interested in the comment that we all have to look to the Joseph Rowntree Foundation, the Institute for Fiscal Studies and others—it is hoped before but certainly afterwards—to see the real impact. The question that I really want to ask my noble friend is: will he take back to the Government, in his own inimitable way, the request that it is about time that they learnt from these outside bodies? Why have we had this kind of discussion for as long as I can remember in politics, both here and in the other place? There is nothing new about this. It has always been true.

Why is it so hard for Governments ever to learn a lesson such as this? I remember the difficulty when I was Secretary of State for the Environment of trying to get government offices to have all their area offices and headquarters of other offices in the same town so that you could actually get a job done. You often used to have to go to five different towns to make any kind of decision, and then you would discover that the area covered by each department was different, as far as that region was concerned. We got over one or two of the more extreme cases, but the thing that really worries me is that the conversation that we have just had—which, after all, has been most amicable and agreed on both sides—is one that we have had too often.

I wonder whether this Committee might be the one in which we could say enough is enough and that this is a matter for governments seriously to deal with. Otherwise, it does not matter who is on which side. We will go on having this discussion. If it is not about disability, it will be about something else where as similar problem arises—where the Department of Health, the Department for Work and Pensions, the department responsible for local government and everyone else have not really got together to see how their various concerns impact on particular individuals.

This is the effort of a long-time Member of Parliament and a very long-serving Minister to say that having failed myself, and being honest about that, do you think that we could on this occasion bring it home to someone who is very much above the pay grade of anyone in this Committee? This is something that the Government have to take seriously. It is very boring, constantly, to have this conversation, with good-hearted people on both sides of the House saying the same things and, in the end, knowing very well that it will not have the effect that we really want.

[Lord Beecham]

My Lords, this has been an interesting debate with some extremely perceptive contributions. I very much welcome the contribution of the noble Lord, Lord Deben. He and I occasionally crossed swords during his tenure at the Department of the Environment, as it then was, but he was right to say that we need a balance in the view of claimants that is so often the focus of public debate in the media and, sometimes, by politicians. There are always some who abuse the system, but they are not by any means in the majority. There are many people who do not claim who should claim, whether it is for disability or other things. That reference to balance is highly desirable.

However, I am slightly nervous about his reference to government offices because there certainly was a problem and the Government have certainly solved it—they have closed them. There are now no government offices for people in the regions to go to. It has all been centralised. However, his fundamental point is right. The Government need and have failed, so far as one can judge in connection with the Bill, to look across departmental interests and the client groups that may be represented by various government departments.

It is interesting that there is no specific mention of disability or any other particular category in the impact analysis, although it is a significant element in the Bill, the Government illustrate only the impact on pensioners and other age groups. The analysis does not refer at all to disability as a specific issue and yet, as we heard from the brilliant forensic analysis by my noble friend Lady Lister, there is a huge problem that affects a variety of people with different disabilities and conditions, and of course their carers, which clearly must be taken into account.

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I therefore say to my noble friend that I hope that this matter can be reconsidered, that we can have more clarification and that this reasonable request receives a favourable response.

[Lord Deben]

My Lords, I am so often in agreement with the noble Baroness, Lady Hollis, that I hesitate to intervene, but this is entirely the wrong way round and I deeply disagree with her. This is a very important aspect of what we are doing because the problem with localism is that everyone who has ever been concerned with centralism will find on every occasion that it will be better done by those clever people at the centre. What was behind the noble Baroness’s comments was to say, “The vulnerable will be protected only if we at the centre make sure that no one has any input on this at all in case they might make a different measure and balance, given their available resources”.

I must say that I really wonder what I would say if I had been a local councillor and had heard her comments about what was likely to happen if the local council had made these decisions. The noble Baroness represented a Labour council that decided that in local terms it would bilk the Government’s policy on the sale of council houses. It said, “We have a right to do this”. My noble friend was the one who had to stop the council doing that because it was a government policy, but the council took its own view. It was against the law. It actually broke the law in order to uphold localism as it saw it.

[Baroness Hollis of Heigham]

No we did not.

[Lord Deben]

I have to say that it is not unreasonable—

[Baroness Hollis of Heigham]

My Lords, we did not break the law. I actually won the first round for judicial review. It was only when subsequently it was clear that it would cost the local authority a lot of money if we went to appeal—against Lord Denning—that I decided that we would negotiate. What then happened was that the regional officer was sent in to run the sale of council housing for us and, after six weeks—I was deposed as housing chair—he came knocking at my door saying, “Could we discuss this?” He was hidden behind a huge bouquet of flowers. I said “Of course, of course”. He said, “No one will work with me because when I’m gone, you will still be there”. I said, “Oh, dear me”. We negotiated and six weeks later, he went off to Africa as a chaplain and we went back to where we were.

[Lord Deben]

As we are going down memory lane, I will just remind the noble Baroness that no other local council thought what her council thought about the law. Everyone else accepted that the law was as it was, and indeed it was the law of the land. I am not blaming her for it; I was cheering her on. In those days, she did think that localism mattered, even in a matter so clearly a national policy. My problem with everything she has said is that I have heard it again and again, but normally from officials. Normally it is central government civil servants who sit there and say, “Better not, Minister. If you allow people down there to make decisions, you never know what might happen”. I would say this to her: you have got to start somewhere. Why can we not start here? After all, council tax is a local tax. It is ludicrous to say that the tax is local but the arrangements for the tax rebate should be national. I find that unacceptable and therefore I hope very much that the Ministers will not read out a concession or a helpful comment. I want the Ministers to be tough about this and say, “This is a matter for local authorities”. If local people don’t like it and think the local authority has not been generous enough or has not used the extra funds from something it is able to control—I hope that local authorities will be controlling more and more because I believe in localism—those local people have in their hands the ability to change the authority. This is exactly what has destroyed local government over the years, and my party has been as guilty of it as others. We are always frightened about giving local councillors the real decisions about things.

I do not want to go too much into the detail, but I can also argue that not all reasons for local council tax rebates are central and national. I can cite a lot of examples where the pressures and the concerns about vulnerability are different in some parts of the country from others. Rural areas have different demands with regard to vulnerability from close-knit communities. I merely say that one could go through a list of those.

I come now to the thing that really made me stand up. It was the use of the phrase “postcode lottery” by the noble Baroness. It is a Daily Mail argument that she should never use.

[Baroness Hollis of Heigham]

But it is true.

[Lord Deben]

We want postcode decisions, not a postcode lottery. We want local authorities to make their own decisions about their own communities and their own priorities. What has been wrong in this society for too long is the use of this ridiculous argument.

The noble Baroness says, “You may be on the wrong side of the line”. Well, frankly, that depends on what you think is the wrong side of the line. It may be that in a particular locality, scarce resources are used in a different way from the neighbouring locality. That does not mean to say that you are on the wrong side of the line, it means that you are on the wrong side of the line as defined by the noble Baroness. That is the trouble. Central government has always believed that defining these lines is the business of central government and never of anyone else.

When I was Secretary of State for the Environment I remember addressing a local government conference. When I said that I believed we should do nothing in Brussels that we could not do in Westminster, but what we had to do in Brussels we should do well, and we should never do anything in Westminster that we could do in county hall, but that anything we do in Westminster should be done well, I was cheered. When I went on to say that we should nothing in county hall that we could not do in district council offices, I was cheered again. But when I said that we should do nothing in district council offices that we could not do in the parish council, I was booed. Why was that? It was because everybody believes in subsidiarity—up to there. The moment you talk about subsidiarity below them, all hell breaks loose. The world will fall apart and vulnerable people will be totally stamped on—because we are the only people who know.

That was a very good example of “the man in Whitehall knows best”. It was always the purpose of centralists to claim that no one else could make decisions. I have been longing to say this about the postcode lottery and the moment has come, because it is exactly that which we are fighting against. I must say to my noble friend the Minister that, if she gives way on this, she will be taking away the fundamental element of proper localism; that is, you risk local people making decisions that are different from those that you would make. That is the challenge of localism. The noble Baroness has given us the opportunity to take the most difficult example and say, “No, here we stand”.

[Baroness Hollis of Heigham]

How then would the noble Lord explain why council tax benefit was originally included in universal credit and the White Paper, why all the planning assumptions were based on that and why it was only subsequently extracted in a deal between departments? How does this have anything to do with localism as a principle?

[Lord Deben]

It is because the Government have not gone far enough yet; that is the whole point. I would have a different structure, but the noble Baroness must not ask me to answer for the Government. I am lucky enough to be formerly a Minister and to be able to say one or two things which need to be said. I disagree with the noble Baroness, but she will find on other occasions that I am stalwart in support of some of the things that she says which this Government do not agree with. However, on this occasion, I beg my noble friend to stand firm.

[Baroness Donaghy]

I must admit that I enjoyed that. I even agree with one or two points that the noble Lord, Lord Deben, made. I look back to the days when local government had real power and it would be good if that happened again. Given the more centralist-inclined Governments that we have had during the past 30 years, that is probably not very likely.

As your Lordships will see, my name is attached to the amendment. That was a mistake; it was a case of mistaken identity. When the noble Baroness, Lady Browning, went to table the amendment, my name was put down instead of hers. I cannot imagine why, but I was very happy to keep my name on it even though I did not put it there. Incidentally, on the same day, having sorted out that one to our satisfaction, I sat down and found that my name had been added to a debate in the main Chamber on the misuse of alcohol. I was considerably more worried about that.

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[Baroness Lister of Burtersett]

The noble Lord, Lord Deben, gave us a rousing speech, but I did not hear him address the argument made by my noble friend Lady Hollis, which is that the needs arising from vulnerabilities are not locally determined, they are the same, regardless of where a person lives. I wonder whether the noble Lord would argue that the Government were wrong to protect pensioners from above, because for some reason, pensioners are being treated as part of a national scheme whereas people below pension age, who may be just as vulnerable, are not being treated as part of a national scheme.

[Lord Deben]

I thought that I made it clear that the assessment of vulnerability does not necessarily have to be central . I do not happen to think that if it were local it would be any less unpleasant or pleasant than if it were done centrally. As to the comment about whether the Government are protecting this group rather than another, I was suggesting that this is at least one step in the direction in which local people can have some real control over what they want to do.

The idea that they will all be less generous than the Government seems to be rather rude about locality and it shows that in the end people do not believe in localism because they always think that people at the top will make a better decision than people at the bottom. I just happen to think that Suffolk County Council does it much better.

[Baroness Lister of Burtersett]

I certainly do not want to be rude about local authorities. Some things should be locally determined, but this is not one of them. I am sure that my noble friend Lady Hollis will return to that much better than I could.

I want to raise one point that I know will cut absolutely no mustard with the noble Lord: the position of people who move between local authorities, which some government policies encourage them to do. If there is no national guidance on vulnerability, they will not know how they will be treated when they move from one authority to another. The researchers in the report that I quoted earlier by Demos and Scope, said that they were struck by an “oppressive sense of uncertainty” that many disabled people were living with which,

“clearly jeopardised their emotional wellbeing”.

Without clear guidance, that uncertainty will be aggravated.

It is not only disabled people who feel uncertainty; it is part of living in poverty. There is a sense of insecurity and uncertainty. At least national guidance would allow people to know how they would be treated when they moved from one authority to another.

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[Lord Beecham]

My Lords, we have had a longer and more entertaining debate than many of us thought we would have. We had the Browning versions, two of them, and we have had an interesting conflict between Norfolk and Suffolk. I hesitate to arbitrate between those two counties. In relation to the remarks by the noble Lord, Lord Deben, from time to time, I have been tempted to form a society for the preservation of the postcode lottery. In some areas of policy, it is absolutely the right line to take. We have had too much regimentation and prescription nationally about what should and should not be done.

However, we are not talking about policies here but about the people’s basic right to a minimum income. To take the point made by the noble Lord, Lord Deben, to its logical conclusion, we would have differential benefits across the piece. We would have different benefits for disabled people, pensions, child benefit and whatever up and down the country, determined locally. The noble Lord shakes his head, but where is the difference? The difference that he advances is that council tax is raised locally, but that is an irrelevance to the person looking at his disposable income that he has to deploy in support of his family. Where the localism part should come in—not the faux localism of the Poor Law—is that you would have a national basic minimum entitlement which, if the local authority thought it right, you could increase and enhance benefits. That would seem to be a reasonable application of localism because everybody is guaranteed a national minimum and locally the community may decide to augment it but, in our view, it should not be in a position to reduce it.

One of my noble friends, or perhaps the noble Baroness, Lady Browning, referred to Localising Support for Council Tax Vulnerable People. Paragraph 3.4, about equality information and engagement, states in connection with child poverty that:

“authorities will be required to take into account their local child poverty needs assessment”.

That is fine.

“Local authorities should be able to design localised council tax reduction schemes in a way that best suits local circumstances, tailored to what child poverty looks like”—

looks like—

“in the local area”.

I will tell you what child poverty looks like in any area. It is the undernourished child going to school, perhaps dependent on free school meals. These days, he may have to go to a breakfast club to get a breakfast. According to a recent survey, 50% of teachers are going into schools with food that they can distribute to the children. Child poverty is children going badly clothed, living in fuel poverty so the house is cold, and perhaps with dysfunctional families, although that is, of course, not simply a financial matter. This can occur anywhere. These children can be found in the city that the noble Lord, Lord Shipley, and I have represented and led and in the city that the noble Lord, Lord Smith, still leads. They can be found in villages in Suffolk, I guess, and in Norfolk, and in Kensington and Chelsea for that matter. They can be found anywhere. As my noble friend said, it is not locality that determines the character of poverty. It may possibly exacerbate a basic condition of poverty, but locality is not the determining condition, and it should not be locality that determines the basic support given to children in poverty or, indeed, to any other vulnerable group. To say that this is somehow an issue of localism is to pervert the proper definition of localism. The noble Lord has advanced a weak argument—from the best of motives because, in policy generally, he has a strong point. But in this area it is entirely misconceived.

[Lord Deben]

Let us take child poverty of the kind that the noble Lord described which is certainly true in some of our villages in Suffolk. It is up to the local authority to decide whether it is going to spend its resources making sure that those children all have a hot meal and all have breakfast rather than by having a special element in the council tax arrangements to deal with that. If the noble Lord feels that there is not enough elbow room for local authorities, I wish he would listen to his noble friend’s comments, because it seems to me that we should be pushing for many more opportunities for local people to have the resources to do the things that matter. How you deal with poverty in very distant rural areas is very different from the way in which you deal with it in Limehouse.

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[Baroness Hollis of Heigham]

My Lords, this is not a formality: I thank everyone who has taken part. In a way, the Committee caught alight on this, and it is good that that was on such an important issue.

The noble Baroness, Lady Browning, was right when she said that there was an issue about precepting and billing authorities, which the Minister referred to at the end: the knowledge is on one side and the billing authority is constructing the discount scheme on the other. The lesson that I suggest to the Minister that we take from that is a different one: that you should certainly consult and should have time to consult. She should therefore think again about her response and that of her colleague, the noble Earl, Lord Attlee, to my noble friend’s amendment about the ability to delay, because I assure her that it just will not be possible to get the schemes in alignment and, having done that, to move them out to public consultation all within the financial cycle, ready for introduction in April. That will not work. The Minister, as well as the noble Baroness, Lady Browning, has made our point for us in spades. I hope that as a result she will be able to review the Government's position on the amendment in due course.

I have the greatest admiration for the noble Lord, Lord Deben; on many issues we have been side by side and he was the Minister who, above all, stopped planning in local authorities being subject to the free market, a legacy bequeathed by his colleague Nicholas Ridley, a former Secretary of State for the Environment, which allowed many of us to protect our historic buildings, streets and centres. The noble Lord is in the book of the almost very good in most local authorities, and I am sure that he would want to keep that reputation intact.

No one doubts that planning is a local decision. Obviously there are inspectors and so on, but none the less it is local. However, when you have a number of elderly folk who need care and support and the local authority—rightly, in my view—makes a decision about whether it is more appropriate in its area to go for residential care or, possibly because it is a rural area, to go for extended domiciliary services, it is right and proper that one local authority should differ from another according to the geography and nature of the locality. The noble Lord and I have no differences about that; I was not in local government for 25 years to knock localism. That is why I bothered with it, as do many people in this Room today.

However, it is not a matter of centralism versus localism when you come to the individual entitlement to income. It is simply a different category. In planning, the planning authority is acting as umpire between local residents and car drivers. In residential care, it is a case of deciding how a particular type of need is best met, and many flowers may bloom. However, individual entitlement to income is a basic human right and not part of the proper territory of debate between centralism and localism. This is not about the clever people in the centre knowing best, to copy the noble Lord’s words—that really is an absurd statement—but neither do local people know best. Will the noble Lord argue equally that, because joblessness rises in a locality, unemployment benefit should be locally determined? I await his reply.

[Lord Deben]

Unemployment benefit does not relate to a local tax. We are talking about a local tax, and in a locality it would be sensible for a local council, for example, to say that the way to deal with child poverty in this area is to spend the money on providing the means for them to be fed because it had discovered that by doing it in another way the children did not get the food because the parents used it elsewhere. That is a perfectly reasonable thing for people to decide.

[Baroness Hollis of Heigham]

We could have another argument about whether to have cash or benefits in kind, but the point about income is that it is a national entitlement. We have accepted that for unemployment benefit, I think. Even though the lack of a job may arise because of the peculiar distinctiveness of the locality, we do not then say that, as a result, that should determine the level of unemployment benefit. Equally in housing, rents and policy are determined locally. Is the noble Baroness going to argue that housing benefit should also be a local benefit as opposed to a national one? I do not think so. The main argument that he has used is that because council tax is levied locally, council tax benefit should be structured locally. That takes no account of the fact that half the country is in two-tier authorities where they have no control over what the precepting authority may levy on the billing authority, yet the billing authority takes the problem, cost and moral responsibility for the discount scheme that runs. As a former MP for an area with a rural district council in Suffolk, the noble Lord will know that as well as anyone. His argument does not run in two-tier authorities—it cannot, because the council tax is not generated by the billing authority that is constructing the discount scheme, and any toughness in the scheme to impress on people what their value for money is does not relate to that particular billing authority.

[Lord Deben]

They do have control over it—they have an election. If they do not like what the county council has done they can vote against it. If the noble Baroness is really saying that the only system that people can understand is a single-tier system, she is making a mistake that is very much wider than this. Many people know which do what, and, if they do not like what one of them does, they vote against them in the local election, as we all know.

[Lord Beecham]

Does my noble friend agree that although there is a significant reduction in the amount of central government support for the benefit, it is still approximately 90% government funded? So it is going towards a council tax, but the funding is still essentially central. Unfortunately, some more of it will fall on the locality as a result of what the Government are doing, but the greater part is still centrally funded.