I expect to meet the leaders of the ACC, together with the other local authority associations, in the consultative council on local government finance on 30 July.
Will my right hon. Friend confirm that if a hard-pressed county, such as Northamptonshire, can meet its target, many other counties should be able to do so? Will he bear in mind that there is something wrong with the system when low per capita spenders, such as Cambridgeshire, find themselves facing a heavy penalty while some of the high per capita spenders, such as Cheshire, need to make only a marginal transfer back to the Government?
For the vast majority of local authorities it was not intolerable to request that they should meet the target of reducing the record level of local authority expenditure by 5·6 per cent. over three years. In the revision of budgets, I hope that most authorities will show what is possible. I recognise that there are problems about the way in which we have set the targets. That is why, when I spoke to a conference of local government treasurers, I invited them to put forward an alternative proposition. The Government made it clear that they were willing to entertain other targets if a better system could be introduced. Unfortunately, local government has been unable to suggest an alternative.
When the Minister discusses grants for the next settlement, will he consider revising his procedures? The last round moved resources away from large cities, where the pressure points are, in favour of county councils which vote Tory. Might that not have some bearing on what is happening in some of our cities?
In the new system of grant-related expenditure assessment, we have tried to get a fair and objective measurement of grant. The Association of Metropolitan Authorities has put its views to us about the need to take into account the position of inner city areas. That is being considered in the grants working group discussions. The Government will have to take their view later for this year's rate support grant settlement.
When the Minister is considering the problems of local government finance, especially in relation to the inner cities, will he consider the problems for cities, such as Liverpool, which now have to face the consequences of the riots and the enormous costs involved—possibly millions of pounds? The invocation of the Riot (Damages) Act is not of real help to the city, because the cost will have to be borne by local ratepayers. Will he therefore consider, within the terms of the block grant payment, making special provision for additional Government finance to help those who have suffered riot damage?
We have a difficult problem in trying to assess a fair distribution of the grant. Everyone is aware of the problems to be faced in Liverpool and other cities. The hon. Gentleman is calling for extra funds, but I am sure he will accept that there does not appear to be an immediate direct correlation of the kind that he makes that it is necessarily the most deprived areas where the problems exist.
When my right hon. Friend meets council leaders, will he take into account the fact that the Birmingham city council, though Socialist-controlled, feels that it is being harshly dealt with? Will he comment on the fact that as many Conservative leaders as Labour leaders of local authorities believe that the present system lacks common sense?
That is why I made the proposal that if any hon. Member or any member of local government would care to suggest an alternative or more satisfactory system, he should suggest it. I am disappointed that we have had no satisfactory response.
I have already had meetings with local government representatives on this matter. We are awaiting the revision of budgets. Those are not due until the end of this month. We shall have to consider what action is necessary. It will take time to assess those revisions of budget, but, if they do not achieve the economies we need and it is necessary to proceed with a consultation document, we shall do that at the earliest possible date to allow us to consult the local authorities. We shall need to press on with that, and it will probably be in early September.