Lord Stunell
Main Page: Lord Stunell (Liberal Democrat - Life peer)(11 years, 10 months ago)
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The Parliamentary Under-Secretary of State for Communities and Local Government (Andrew Stunell)
It is a pleasure to serve under your chairmanship, Mr Howarth. I congratulate the hon. Member for Makerfield (Yvonne Fovargue) on launching the debate, and the many colleagues who have contributed to it. It will be extremely challenging to answer all the points raised, so I will pick out what seem to me to be the key ones. It is time that will limit what I am able to say, certainly not the strength of the arguments.
There has always been recognition in the House that welfare spending needs to be targeted properly and that more needs to be done to tackle poverty by getting people off benefits and into work. Part of achieving that, and part of the Government’s strategy for doing so, is to return control over council tax support to councils and for local authorities to have the freedom to decide how to help provide for the most vulnerable in their communities.
Andrew Stunell
Yes, although it will reduce my chances of answering all the points that have been raised.
Grahame M. Morris
I am grateful to the Minister for giving way on this fundamental point. Will he recognise that housing benefit is an in-work benefit?
Andrew Stunell
I suspect that the hon. Gentleman meant to say council tax benefit, which is what we are debating. I certainly accept the figures given by the hon. Member for Warrington North (Helen Jones). Of course, some of the recipients of the benefit are in work. That is not in doubt or dispute.
I remind Members that council tax benefit expenditure more than doubled between 1997 and 2010. Much of this debate has centred on two different but overlapping things: localisation, which, on the whole, Members present seem to approve of; and the reduction in the total amount of money being distributed, which, on the whole, they seem to disagree with. I understand the difficulties that this creates, but I remind Members that the reason why we have to reduce central Government spending is the inheritance that the Government received in 2010.
Andrew Stunell
No, I will not.
At that time, there was a gap of £400 million every day between the amount being spent by the outgoing Government and the amount they were receiving, in tax and other receipts—£400 million was being added every day to the national deficit. The measure we are discussing is part of the Government’s strategy to put this country’s finances back on a firm footing. As has been noted, it consists of a reduction of £500 million per year—not per day—as a contribution to closing the gap between public expenditure and public income.
That brings me to the contributions of hon. Members representing constituencies in Wales and Scotland. In both those nations, the allocation of the reduction is strictly in accordance with the Barnett formula, and that reduction is no more ring-fenced in its decrease than any increase under the formula. It is entirely a matter for the Welsh and Scottish Administrations to decide how to proceed on the schemes in their respective countries. It is important to make that point.[Official Report, 17 July 2012, Vol. 548, c. 1MC.]
That brings me to the many points that have been made about the implications and ramifications of the reductions. I want to illustrate how far wide of the mark some of those comments were by reference to a point made by the hon. Member for Mackerfield.
Andrew Stunell
I apologise for mispronouncing the constituency name; I ought to know better, as I come from that part of the world.
Under our proposed scheme, Wigan metropolitan borough will face a reduction of £2,130,661. I am happy for that to appear on the record.
Andrew Stunell
No, I will not give way on any points, because I want to proceed.
In another part of the Local Government Finance Bill, we are giving Wigan metropolitan borough the capacity to change its current discounts and exemptions for empty homes and second homes. Wigan metropolitan borough, which I am sure the hon. Member for Makerfield would agree has considerable social and economic problems, will be able to raise £2,173,854, if it chooses to exercise its discretion fully. The difference between those two figures is £43,000 in Wigan’s favour; under the Bill, it will have capacity to raise more revenue than it will lose.
That important point very much undermines the arguments made by a number of Members. It brings a sense of reality—[Laughter.] The nature of things is that very few Members of Parliament have detailed experience of local government finance systems; they are highly dependent on the advice they receive from local authorities and their senior finance officers. If Opposition Members asked their individual local authorities how much they would be able to increase their income if they took advantage of the Bill’s proposed discounts and exemption changes, I think that, almost without exception, those Members would be substantially surprised.
In my remaining two minutes, I want to thank my hon. Friend the Member for Mid Dorset and North Poole (Annette Brooke) for her comments. I welcome her back, because she has been absent from the House for some time. She has not lost her touch. She made it very clear what she thinks about the issue and has been consistent and persistent in making her point. The authorities in Dorset and Poole can, if they choose to, offset the reduction in support for council tax benefit via changes to the exemptions that they levy.
The hon. Member for Makerfield made a point about the schemes that local authorities will introduce, but I am sure that it will be obvious to her that Wigan can continue with exactly the same scheme as it has now, if it wishes to do so. If it continues with that scheme, it will not need the guidance and support that we have already issued to local authorities on all the relevant matters. Indeed, some local authorities are already carrying out public consultations on alternative schemes and will have them in place by 1 April.
Mr George Howarth (in the Chair)
The hon. Gentleman is experienced enough to know that that is not a point of order.
Andrew Stunell
Wigan does not have to do that, because if it takes advantage of the discounts and exemptions that we have given it, it will be able to carry on with its current scheme.