Local Government Finance

Debate between Grant Shapps and Nigel Evans

Wednesday 8th February 2012 Commons Chamber

[The Minister for Housing and Local Government (Grant Shapps)]

I beg to move,

That the Referendums Relating to Council Tax Increases (Principles) (England) Report 2012-13, which was laid before this House on 31 January, be approved.

[Mr Deputy SpeakerMr Deputy Speaker (Mr Nigel Evans)]

With this we may take the following motion

That the Local Government Finance Report (England) 2012-13 (HC 1801), which was laid before this House on 31 January, be approved.

[Grant Shapps]

Over recent weeks my colleagues and I have had many conversations with local government. We have spoken to individual authorities, the Local Government Association, London Councils and other representatives. They bring a degree of realism about public finances which is sometimes absent from the House. They know that local authorities account for more than a quarter of total Government spending, and that tackling the record deficit is the responsible thing to do. They know that this helps families as well.

In these tough times, as a proportion of total income, interest payments for mortgages are currently at their lowest since records began. A Labour Government would have meant more expensive mortgages, failing to tackle the deficit—[Hon. Members: “No, it would not.”] Yes, it would, because failing to tackle the deficit would have meant bigger spending cuts and higher taxes. One has only to look at Italy and Greece to see that their borrowing costs have rocketed. They are cutting local government spending, proportionally, far faster and far more than we have had to do here in Britain. Let us look at the Republic of Ireland, which has had to introduce a new property tax to try to plug the gap. The reckless calls from the Opposition to spend more money, have higher taxes and ignore the cuts would lead us to very difficult times for families across this country.

Councils have come to discussions with a positive and constructive attitude, which does them great credit. As we have seen, councils are making a huge effort to make the money that is available go further. They have innovated, done things differently, reformed and rethought their services. For example, Lichfield and Tamworth district councils are now sharing their waste collection services. Councils have tried to cut out every instance of duplication. For example, Lincolnshire is bringing county and district data together so that people have to tell councils only once when they want to get something done.

Councils have thrown open their doors to shine a spotlight on waste and drive it out. All councils across England have chosen to publish online their expenditure over £500—all councils except for one sorry exception, Labour Nottingham city council. It is disappointing that Opposition Front Benchers still support the continued arrogant and outrageous secrecy against the residents of Nottingham city, who deserve to see how their money is spent. [Interruption.] They laugh about it, but the public have a right to see how their cash is spent. If the Labour party had some mettle, it would stand up to its local authorities that are refusing to publish that information. My Department has published online every single penny of Government procurement card spending, which has helped cut such spending by three quarters.

--- Later in debate ---

[John Healey]

On a point of order, Mr Deputy Speaker. The Minister has tried to help the House and said he wanted to be clear, but he has just made the fundamental mistake, which I think he needs to correct, of citing precepts and not levies in the examples he gave. He therefore underlines rather than undermines my point.

[Mr Deputy Speaker (Mr Nigel Evans)]

The right hon. Gentleman has got his point across.

[Grant Shapps]

Thank you, Mr Deputy Speaker.

Most people out there would be most interested not in whether a council tax referendum triggers at 3.5% or 3.51%, or whether that includes the £20 charged by the parish council, although that is interesting and I hold by everything I have said at the Dispatch Box so far. Most people in the country would be most interested in the fact that council tax doubled under the previous Administration. If Labour Members had their way, they would have council tax going up even further. People might ask how we know that for certain. The simple answer is that they have not supported this year’s or last year’s council tax freeze. Typically, the council tax freeze in the last year saved the average family at band D £72, and we are providing a further £675 million of funding this year to councils to freeze their bills yet again.