Amendment of the Law

Lord Pickles Excerpts

Monday 28th March 2011 Commons Chamber

[The Secretary of State for Communities and Local Government (Mr Eric Pickles)]

It is a great pleasure to resume the debate on the Budget.

Since 1997, year on year, families have waited for that dreaded envelope: the council tax bill. Every year under Labour, it grew, eventually doubling in size, but this year something is different. As the bill hits the doormat, families and pensioners throughout England will find that it has not gone through the roof. It will save families up to £72 on a band D home, because the coalition Government are on the side of ordinary working people. I commend those councils—every single one of them—that have taken up the Government’s offer to give their residents a much-needed break, but I am very disappointed that the Opposition have opposed the measure.

In the Commons, the shadow Local Government Minister, the hon. Member for Derby North (Chris Williamson), called the measure a “gimmick”. His Lords counterpart last week also opposed it, alleging that the

“freeze builds up financial trouble for the future.”

Surely that cannot be the Labour party’s position, because it is not what Labour councils are saying on the ground.

I have a selection of quotations, and I will read out just three that will help. Sandwell’s local authority states:

“The council is very aware of the difficult times local people face, and we don’t want to add to their misery”.

On the freeze, it states:

“It would be barmy not to do so.”

Manchester city council, a local authority that we have heard a lot of recently, states:

“We recognise it has been a very difficult year for some people, and as the UK comes out of recession it is critical we offer all the support we can to Manchester residents… it is great news…that this year we will freeze council tax”.

[Mr Nick Raynsford (Greenwich and Woolwich) (Lab)]

Will the right hon. Gentleman give way?

[Mr Pickles]

In a moment. Let us have the full panoply before we hear from the right hon. Gentleman.

[Bob Russell (Colchester) (LD)]

He’s one of the guilty men.

[Mr Pickles]

Yes.

Bolsover council states that

“we have taken this step to freeze our share of the Council Tax because we do not feel it is fair that these are passed onto you”.

I do not recall the right hon. Gentleman freezing the council tax during his time in government, but let us hear from him.

[Mr Raynsford]

I am sure the right hon. Gentleman will recall, because he has followed local government matters, that the London borough of Greenwich, the authority in the area I am proud to represent, has frozen its council tax for six of the past 10 years—under a Labour Government for five of those six years. Has he forgotten that? Is he not aware of what councils were doing long before he took up his current position?

[Mr Pickles]

I suppose if a council sits on £130 million of reserves, that is an easy thing to do, but let him recall Hammersmith and Fulham, which, after years of considerable increases, managed not only to freeze the council tax but to cut it in each successive year.

I regret that the Labour party says one thing in the Chamber and another thing to the voters. I am proud to say that we are able to set aside—

[Sheila Gilmore (Edinburgh East) (Lab)]

Will the Secretary of State give way?

[Mr Pickles]

In a moment.

I am proud to say that we are able to set aside £3 billion to support councils with a freeze on spending, and that is despite the mess that the Labour Government made of our nation’s finances. It sounds as though some on the Opposition Benches would like to wash away the past few years and drown out their bitter legacy: record national debt; unsustainable public spending; and a crushing burden on ordinary families.

The Opposition do not like to admit that their Labour Government planned spending cuts of £44 billion by 2015. Labour’s cuts were to be front-loaded cuts, with £14 billion of cuts falling this April, and Labour’s spending plans would have made bigger cuts to housing, regeneration and local government.

On Saturday, the Leader of the Opposition should have told the crowds the extent of Labour’s cuts. That would have been much more convincing, as hon. Friends have said, than comparing himself to Martin Luther King or, more bizarrely, to Emily Pankhurst.

[Nadhim Zahawi (Stratford-on-Avon) (Con)]

Will my right hon. Friend give way?

[Mr Pickles]

In a moment. I am sure that my hon. Friend would like to hear this point.

Perhaps that omission prompted the right hon. and learned Member for Camberwell and Peckham (Ms Harman) to say today on “The Daily Politics” that a Labour Government would have employed fewer people in the public sector. I have obtained a transcript of the interview, and the interviewer said:

“Some of the people on that march, some of those people listening to Ed Miliband, would have lost their jobs under a Labour Government. Yes or no?”

The right hon. and learned Lady was wise enough not to give a yes or no answer, and said:

“Well, I think that basically we would see, err yes, fewer people employed in the public sector.”

[Hon. Members: “Ah!”] Yes. I think “err yes” neatly covers the point.

[Nadhim Zahawi]

Does my right hon. Friend not think it bizarre that the Leader of the Opposition chose to compare his party’s struggle to that of apartheid?

[Mr Pickles]

Well, I suppose there comes an occasion, you turn up, there’s a lot of people there—and you just start to talk. These things happen, and we should be in a forgiving mood. I mean, anybody can compare themselves to Martin Luther King.

[Chris Leslie (Nottingham East) (Lab/Co-op)]

Who would you compare yourself to?

[Mr Pickles]

Certainly not to Martin Luther King.

Let us be clear: Communities and Local Government was the unprotected Department under Labour’s plans. Unprotected Departments would have received a larger average real-terms cut over four years under Labour than they are under the coalition’s deficit reduction plans over the spending period.

Thanks to the £18 billion of savings from our welfare reform programme and the £3 billion of savings from lower debt interest, the coalition is cutting £2 billion less from departmental budgets than the Labour party would have. Labour would have cut local government more, and, without the support for a council tax freeze, the end result would have been soaring council tax.

[Sheila Gilmore]

Will the right hon. Gentleman give way?

[Mr Pickles]

I am so sorry. I promised to give way to the hon. Lady.

[Sheila Gilmore]

Will the Secretary of State consider monitoring what happens to charges where local authorities have imposed the council tax freeze? We have had a council tax freeze in Scotland for four years now, and a 90-year-old constituent of mine has just received a charge for garden aid. It was nil under a Labour council, it became £75 and it is now £200, so she is not that impressed by the council tax freeze.

[Mr Pickles]

We will certainly look at that, but may I remind the hon. Lady that Labour councils are of the view that it would be “barmy” not to have the freeze, and that the freeze itself is “great news”? She should really get with the programme.

[Mr John Redwood (Wokingham) (Con)]

That is great news on the council tax—fantastic. Will my right hon. Friend confirm that, every year of this Parliament, total spending goes up in cash terms, so, if the public sector can control costs and inflation, the situation need not be nearly as bad as the Opposition say?

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[Mr Pickles]

My right hon. Friend, as always in these matters, is absolutely correct. There is sometimes a fallacy, which the Opposition assume, that a pound cut in grant means a pound cut in services, but there are clearly better ways of doing such things.

Last June’s emergency Budget started a rescue mission. It preserved the UK’s triple A rating and helped to keep interest rates stable. This Budget shows that we are moving from rescue to far-reaching reform. It is a Budget for a strong and stable economy, marking our progress towards eliminating the structural deficit. It is a Budget for growth, rebalancing the economy away from over-reliance on the public sector towards long-term, sustainable growth based on export and investments. This is a Budget for fairness, lightening the burden on some 23 million taxpayers by lifting the personal income tax allowance.

In the past, there may have been an impression that the people in Whitehall who were responsible for the economy sat in the Treasury or in the Department for Business. Today, every part of Government has a role to play in helping to keep business thriving. I am proud of my Department’s reputation as one of the most deregulating Departments in Whitehall. The Communities Department is central to economic activity, and were it not for the cost of sign writers and stationery, I would rename it the Department for Communities, Growth and Local Government. Over the course of the past 10 months, we have cut the red tape on councils; called time on the Audit Commission’s clipboard inspectors; unravelled Labour’s home information packs; scuppered Labour’s ports tax; scrapped the Whitehall density targets for housing, which encouraged garden grabbing and a glut of flats; and binned the planning rules that encouraged councils to hike up parking charges in town centres. Today, we are going further still to create the conditions for growth.

[James Morris (Halesowen and Rowley Regis) (Con)]

The Secretary of State talked about rebalancing the economy. One of the most shocking statistics that the Chancellor quoted in his address was that in the west midlands, during a time of growth, we saw a 3% decline in private sector jobs growth. In areas such as the black country, it is absolutely essential that we deregulate and find as many opportunities as possible to drive entrepreneurship, small business and economic growth.

[Mr Pickles]

My hon. Friend makes a very reasonable point. Part of the problem is that we are now having to rebalance the economy.

Last week’s Budget was driven by an absolute certainty held by Conservative Members—that Governments can print money but only businesses can make money. We do not succeed as an economy by giving bean counters the whip hand over wealth creators. Governments need to listen to entrepreneurs about how to unlock growth.

I do not want to be terribly unpleasant about the regional development agencies, but perhaps I should on just this one occasion. They were fantastic at passing public grants from one part of the public sector to another, but very poor at creating private sector jobs and sustainable growth. After a decade of regional development agencies—my hon. Friend the Member for Halesowen and Rowley Regis (James Morris) gave figures for the midlands—the public sector still accounts for more than a quarter of jobs in the north-east, compared with less than a fifth in the south-east of England, and the number of private sector jobs grew half as fast in the north-east as the national average between 2003 and 2008.

[Claire Perry (Devizes) (Con)]

The Secretary of State said that we should have fewer bean counters and more wealth creators. Would not a few bean counters not have come amiss under the previous Government, who spent £135,000 on luxury Parisian sofas for the Department, partly under the stewardship of the right hon. Member for Don Valley (Caroline Flint)?

[Mr Pickles]

It is indeed true that we are a well-upholstered Department.

[Charlie Elphicke (Dover) (Con)]

Is not the key difference that instead of quangos such as the RDAs running amok across the country doing nothing, we will see enterprise zones and pro-business, pro-growth planning policies that will get the country going again properly?

[Mr Pickles]

My hon. Friend is absolutely correct—so much so that I am delighted to tell him that I will refer to that in a few moments.

The regional bureaucratic approach is not only costly but does not do the job it is supposed to do. Instead, we want to see business men and business women playing a leading role in the debate about their local economy, helping all parts of the country to live up to their full economic potential.

More than 90% of people in England now live in areas with local enterprise partnerships. These partnerships are a new approach to economic development, putting local councils, local communities and local business in the driving seat. The partnerships established so far have already set out plans that are high on ambition and low on bureaucracy—plans to attract investment, boost tourism and strengthen transport links. Local enterprise partnerships are going for growth, not handing out grants. The 21 new enterprise zones are an opportunity for leading partnerships to take their work to a new level. In exchange, we will let them keep all business rate growth in their zones for at least 25 years.

Businesses in the enterprise zones will benefit from a discount of up to 100% on rates and access to superfast broadband. We will work closely with local partners to make sure that the zones do not simply displace jobs and business. For example, the Boots campus in Nottingham will be a centre for science and medical research and innovation, the Manchester airport zone will be ideally placed to make the most of the local science and engineering expertise and international transport links, and Liverpool Waters will keep up the momentum of economic growth in that resurgent English city.

It is not just enterprise zones that are being helped: the Budget extends the doubling of small business rate relief for a second year. This will help small firms and small shops across the country, given that business rates are the third biggest outgoing for firms after staff and rents.

[Mr Jim Cunningham (Coventry South) (Lab)]

Can the Secretary of State say whether Coventry is going to be part of these enterprise zones, and if not, can he give me the reason why?

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[Mr Pickles]

It is very important to understand that the enterprise zones will be allotted on the basis of innovation and ideas, not on the basis of Buggins’ turn. Having seen some of the industry leaders in the Coventry area, I am confident that their innovation and skills will make them a high priority in obtaining these zones; after all, Coventry and Warwickshire is one of the leading local enterprise partnerships in the country.

[David Wright (Telford) (Lab)]

The right hon. Gentleman will know that several new towns still have areas of land that are, in essence, controlled by Government. Would he be willing to put some of those land holdings into the pot if local enterprise partnerships come up with schemes to promote growth in their areas?

[Mr Pickles]

It is certainly our intention to release an awful lot of Government land.

[Kerry McCarthy (Bristol East) (Lab)]

The right hon. Gentleman mentioned three cities having local enterprise zones, but he did not mention Bristol, although that was one of the 12 listed in the Budget. It is somewhat surprising that the Secretary of State for Business, Innovation and Skills was in Bristol on Friday but did not, as far as I am aware, tell us where the local enterprise zone is going to be. Can the right hon. Gentleman enlighten me?

[Mr Pickles]

This is a very clear example of the difference between how we do business and how the Opposition did business. We are not going to tell the people of Bristol where the enterprise zones will go—they are going to tell us.

[Helen Goodman (Bishop Auckland) (Lab)]

There is confusion in the north-east because what the Chancellor said in his speech about enterprise zones—that there will be one in Tyneside—was not the same as what the Budget documents said: namely, there will be one in the north-east. There is an enterprise zone on Teesside, but the geography of the other one in the north-east is not clear. Does the Secretary of State have any insight on that?

[Mr Pickles]

There is one in Teesside and an additional one within the northern area. In truth, it is up to the local enterprise partnerships to put the thing together. [Interruption.] The hon. Lady wants to control everything from here, but I have to say that she was not very successful in doing so. What is wrong with an approach in which rather than us down here in Whitehall telling the people of the north-east what to do, the people of the north-east tell us how they will do things?

We are taking measures to help get the house building industry firing on all cylinders. Every new home supports four jobs in house building and two more in related industries. The availability of new homes helps people move around the country for work. Getting the housing industry moving again is key to restoring growth. Under the new Government, house building starts are up 23% and construction orders for new private housing are up 50% compared with Labour’s last year. But we need to go much further. There are about 200,000 granted planning permissions out there in the country, but the homes are not being built.

The answer is not targets; it is addressing the root causes. First, there is a tight mortgage market, so we will introduce a new form of support that will help first-time buyers get a foot on the ladder: a 20% equity loan, co-funded by Government and developers. That will put ownership within the grasp of 10,000 first-time buyers. We will reform the stamp duty land tax rules on bulk purchases of new homes to boost equity investment. We will help to reduce the sector’s reliance on mortgage funding.

Secondly, there is the problem that elements of the planning system are holding up the building of new homes. Let us go back to the 200,000 granted planning permissions. It is fair for councils to agree a contribution to the area where developers are planning to build to ensure that the development is sustainable, perhaps by providing a new park or playground, or by paying for road widening. However, what looked like a reasonable request three or four years ago may no longer look quite so reasonable if it stops necessary development happening altogether. If those commitments make it simply too expensive to build, we need to be realistic. Councils should not compromise on the essentials to make a development acceptable to the local area, but unrealistic agreements negotiated in the boom times should be reviewed to help new developments move forward quickly.

[Steve Rotheram (Liverpool, Walton) (Lab)]

I am grateful that the Secretary of State mentioned Liverpool, but what is happening with Liverpool Waters is nothing to do with his Government. I read a statement that said, “Pickles was always happy and obedient, and would often roll over and have his tummy tickled.” Although the statement was about the dog called Pickles who found the World cup in 1966, does it not describe exactly what he did when negotiating his Department’s budget?

[Mr Pickles]

I suspect that when the hon. Gentleman was putting that question together in front of his shaving mirror, it seemed more of a tummy tickler than it actually was.

[Chris Bryant (Rhondda) (Lab)]

One of the big issues in many former mining constituencies is that a large proportion of people live in their own homes, but there is no work in the area any more. People do not want to make the decision to move to a place where there is work, but where they cannot afford the price of homes. How does the Secretary of State propose to get round that vicious circle, in which many people in my constituency and in the constituencies of many Opposition Members are stuck?

[Mr Pickles]

The hon. Gentleman will know that we have just put £30 million into the former coal homes area.

[Chris Bryant]

The former coal homes?

[Mr Pickles]

Into the former colliery areas. That £30 million is more than the hon. Gentleman’s party had put in. We will certainly do our best to ensure that there is sustainable development in that area.

[Dame Anne Begg (Aberdeen South) (Lab)]

Has the Secretary of State had discussions with the Department for Work and Pensions on the reforms to housing benefit, under which it will become impossible for someone who is under-occupying their house to get full housing benefit for that house? He talks about building new homes, but what proportion of them will be one-bedroom homes, because a large number of people who will be looking for property under the new housing benefit rules will be looking for such homes?

[Mr Pickles]

The hon. Lady will be aware that we have abolished the density targets, which led to a glut of flats. We will ensure that the market decides a reasonable mix. That seems to be a more sensible and reasonable way of going about the process.

For too long, the planning system has been a source of friction between councils, communities and businesses.

[Dr Alan Whitehead (Southampton, Test) (Lab)]

Will the Secretary of State give way?

[Mr Pickles]

In a moment. The purpose of the planning system is to ensure that the country benefits from the right kind of development—not to frustrate and delay, and generate endless paperwork. The Budget therefore confirms fundamental changes. By the end of the year, we aim to condense the morass of unwieldy national planning policies into one concise, easy-to-use document.

At the heart of our approach to planning is a presumption in favour of sustainable development. We need a system that consistently and predictably says yes to the right kinds of development. We will consult on plans to streamline the information required to support planning applications. We will introduce a planning guarantee so that no planning application will spend more than 12 months with decision makers, when a timely appeal is made. We will consult on proposals to bring empty commercial buildings back into use as residential properties. Let us cut the red tape and make it easier to turn run-down old eyesores into much-needed new housing. At the same time, we will maintain protection for the environment, including by safeguarding the green belt, which was under threat from Labour’s regional plans.

[Dr Whitehead]

rose—

[Bob Russell]

Will my right hon. Friend give way?

[Mr Pickles]

I will give way to my hon. Friend, and then to the hon. Gentleman.

[Bob Russell]

Will my right hon. Friend confirm that the third and sixth paragraphs of chapter 4 of the coalition’s programme for Government on communities and local government will form part of the planning legislation? I believe that they will, but I would like that to be put on the record.

[Mr Pickles]

The coalition agreement is not quite holy writ, but it is pretty close to it, so of course those paragraphs will be included.

I apologise to the hon. Member for Southampton, Test (Dr Whitehead) for not giving way earlier.

[Dr Whitehead]

Does the Secretary of State consider that his abandonment of the code for sustainable development and the target for zero-carbon home building by 2016 will aid sustainable development, build more houses or merely build less worse houses?

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[Mr Pickles]

The hon. Gentleman is entirely wrong. We have included zero-carbon homes, and that will take effect from 2016. [Interruption.] We most certainly have done that.

[Mr Clive Betts (Sheffield South East) (Lab)]

I ask the Secretary of State to look at paragraph 2.12 of “The Plan for Growth”, which states that where an authority does not have a development plan or where such a plan is not up to date, there will be a presumption that an application “will be accepted”. That sentence does not mention sustainability, but just that such applications will be accepted. Does that mean that where there is an up-to-date plan, a developer will have less chance of getting an application through than in an authority without a current local development framework that is still operating on a unitary development plan? In other words, will there be a two-tier and differential planning system in this country, which we have never had before?

[Mr Pickles]

The local plan will have to reflect the presumption as well. It will be reflected in the national planning framework, which in turn will be reflected in the local plan. If a plan is ambiguous or out of date, that presumption will take effect, but there might be an existing plan that conforms to the presumption in favour of sustainable development. Members will now understand why planning is such fun.

Our planning reforms, like the new roles for local councils and entrepreneurs, are there to drive growth, just like the council tax freeze for hard-working families. They show that localism and economic growth go hand in hand. Those who think that the key to getting Britain growing again is for Whitehall to seize control should learn the lesson of history, which is that it repeats itself because no one was listening the first time round.

Let us compare two years, 1924 and 2009. There are many parallels. In 1924, Lenin is dead and Stalin is planning to take absolute power; John Logie Baird is demonstrating a prototype of his latest invention, the televisor; in New York, theatre audiences are getting their first sight of a dance called the Charlton—[Hon. Members: “Charleston!”] Charleston. I do beg your pardon. Also, house building in the UK reaches an all-time low.

[Chris Bryant]

Will the Secretary of State give way?

[Mr Pickles]

No.

In 2009, pleasingly, Lenin is still dead and the Soviet Union is no more; multi-channel TV is available in most homes; and “Strictly Come Dancing” becomes almost compulsory viewing. What is Labour’s contribution to this wave of nostalgia for the roaring twenties? A dance revival such as bringing back the Black Bottom? Introducing a flapper to speak from the Dispatch Box? No, a record fall in the number of new builds. The Labour party rails against the system and the machine, ups its target and achieves absolutely nothing. That is what central control brought us—growth constraint, innovations stifled and an economy needlessly held back. This is a positive Budget, a Budget for stability, balanced growth and above all fairness, and I commend it to the House.

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[Caroline Flint]

If my hon. Friend was going to point out that when we go into recession we have to ensure that we do not go into a depression, that is exactly what the Labour Government did. Things may look rosy from the leather seats of the Secretary of State’s new Government Jag, but for ordinary people, the Government’s plans are hurting but they are not working.

[Mr Pickles]

Mine is a second-hand ex-Labour Jag.

If the Labour Government were doing such a good job, why did the right hon. Lady resign?

[Caroline Flint]

For goodness’ sake. I have always put on record my pride in what the Labour Government did to ensure that this country recovered from 18 years of Tory rule. Whatever my disagreements with them, I will never take that away from any of our leaders of the past 13 years.

This Budget has offered more of the same. The Government claimed that it was a Budget for growth, but we got nothing of the sort. Only a few weeks ago, the Chancellor told us that it would be an “unashamedly pro-growth Budget”, as though economic growth was something that he would normally be embarrassed about. What the Government should really be embarrassed about is that as a direct result of their policies, the Office for Budget Responsibility has downgraded its growth forecast not once but twice. Now we know that growth was down last year and will be down this year and next year. The only things that are growing at the moment are the prices in the shops and the number of people out of work.