Special Charging Orders

Part of Orders of the Day — Local Government Finance (No. 2) Bill – in the House of Commons at 8:45 pm on 5th April 1982.

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Photo of Mr David Alton Mr David Alton , Liverpool Edge Hill 8:45 pm, 5th April 1982

I beg to move, That the clause be read a Second time.

The new clause seeks to amend the Local Government Act 1972 and the Local Government, Planning and Land Act 1980. Its intentions are well known to hon. Members and they have been debated in Committee, on the Floor of the House and in another place. The objective is to give parish councils the opportunity of receiving some of the rate support grant which the Government give to district councils, but which is not always passed on to the parishes.

The clause is similar to one moved during the passage of the 1980 Act. At that time Lord Bellwin gave various assurances and, bearing in mind the assurances that have just been given by the Minister for Local Government and Environmental Services, I hope that hon. Members will realise that ministerial assurances are not always what they appear to be. However, I hope that the assurance just given by the right hon. Gentleman will result in an amendment being incorporated in the Bill.

Lord Bellwin said that the problem of parish councils would be considered. Unfortunately, no results have appeared and the Under-Secretary of State for Wales said in Committee that the objective of the new clause was an impossible task. That contradicts Lord Bellwin's assurances.

I refute the suggestion that the proposal in the new clause is an impossible task. Perhaps the best reason for my view is that some district councils already do what the new clause suggests. They pass on part of the rate support grant to parish councils, and if it is possible for some to do that I do not see why it should not be possible for others to do it. Therefore, I do not accept that it is an impossible task, though I agree that it is difficult and is not as easy as was suggested by the hon. Member for Bootle (Mr. Roberts), who proposed a similar new clause in Committee.

The new clause would apply to many parish, town and community councils which have continued to press for changes in the law. The precepts of the 8,600 parish, town and community councils, which are wholly met from rates levied on the ratepayers of those councils, are taken into account in determining the block grant payable to the local district councils, but none of that relevant grant has to be paid to the parish council and it is not credited to the parochial council to enable the parish ratepayers to benefit. Instead, the district ratepayers benefit, even though they did not have to bear the initial expenditure. That is grossly unfair.

There have been many previous calls to amend the legislation. My hon. Friend the Member for Berwick-upon-Tweed (Mr. Beith) on 12 March 1979 asked the then Minister: How can the hon. Gentleman possibly defend an arrangement under which expenditure earned by the decision of ratepayers in a parish to pay an additional rate should incur grant-aid on a general basis to the district council that does not need to be passed on to the parish? Does he recognise that a few district councils—fortunately, only a few—are actively opposed to the concept of parish councils and would much prefer parish councils to entrust all their functions to them and enable them, the district councils, to control all the grant-aid and for the parish councils to disappear?"—[Official Report, 12 March 1979; Vol. 964, c. 228.] The Minister said that he would consider that argument. However, since then, little has been done.

My hon. Friend the Member for Colne Valley (Mr. Wainwright) wrote to me last week to say: No Minister has ever attempted to defend this unfair situation, but the attitude has been 'wait till we have other legislation and we will include it then'. I have had more representations on this aspect of the Bill than on any of the other horrors perpertuated by the legislation. I have had representations from parish councils throughout the country.

The Sussex Association of Parish Councils said: Parish Councils have been inhibited from taking an initiative on local enterprises and spending money on them, because they know that although the amounts of their precepts are included in the calculation for Rate Support Grant, none of the Grant will be passed on to them. The Great Wyrley parish council said: We … urge you to support the amendment which I am proposing today on the grounds of justice, as the precepts by Parish Councils are taken into account when calculating the District Council's entitlement to the Grant but the District is not compelled to pass on the Grant. Only a very few Districts do so under voluntary arrangements. The honorary secretary of the Derbyshire Association of Local Councils said: The Town and Parish Councils have fought long and hard since even before the 1972 Act for the grant to be paid to town and parish councils on the grounds of justice—their precepts, which are wholly met by parish ratepayers, are taken into account in calculating the district councils entitlement to grant but districts are not compelled to pass on the grant. Only a very few districts do so, under voluntary arrangements. The Yorkshire and Cleveland Councils' Association said: Parish and Town Councils are the smallest tier of Local Government and without doubt the most economically efficient. With relatively modest calls on ratepayers' money they achieve marvellous results for those living within their area. Mr. P. R. A. Newell, the secretary of the Wiltshire Association of Local Councils—it is interesting to note that the president of that association is the hon. Member for Devizes (Mr. Morrison)—said: I have been asked to draw your attention to an amendment put down to the above Bill which would entitle Parish and Town Councils to receive an appropriate share of the rate support or block grant on their precepts. He hopes that I would support that. It is because of such representations, and those of my hon. Friends, that I decided to pursue this matter today.

The Government have said that they have much sympathy with this general idea, but no Minister has ever tried to justify not doing anything about it. Therefore, I have, albeit reluctantly, picked up a suggestion made in the other place 18 months ago that the Secretary of State should make regulations as to how rate support grant attracted to district councils for parish councils expenditure should be passed on to the parish council. That is something which has been debated in the passage of successive local government Bills both by this and previous Governments.

It is apparent, for example, in Wiltshire, that the district council will agree to make the appropriate payment only if there is legislation to force it to do so. The obvious iniquity of the present system is that parish councils are double rated. Parish ratepayers pay their parish rate and the district rate, and the rate support grant element designed for the parish is used to alleviate district council expenditure generally. Areas with active parish councils are subsidising those without them. This injustice works as a deterrent both to the initiative and the establishment of parish councils.

Particularly now, when communities are breaking up for lack of community oriented work, the Government should respond to ensure that these efficient, locally based organisations receive adequate resources and encouragement. As one letter put it: No Parish Council will eagerly undertake (in the low key and economic way which is their trade mark) new valuable local initiatives if the expenditure attracts rate support grant from which the Parish and its ratepayers get no benefit. 9 pm

The most recent survey by the National Association of Local Councils conducted in October 1979 produced 157 answers from 328 district councils with parish or community councils. The Association of District Councils advised its members not to reply to the questionnaire. Of the 157 which answered, 16 said that they paid the amount requested, 42 said that they gave grants of more than rate support grant resource element, 61 said that they gave less than their rate support grant resource element, two gave rate support grant resource and needs element and 38 gave nothing.

There is no reason to suppose that the figures have changed in favour of parish councils. With the present squeeze the money is even less likely to be paid out. In Treasury terms what I am asking for is a small sum. For 1981–82 it represents about 0·16 per cent. of a total local government expenditure of about £36 million.

The Government said in Committee that, if a way could be devised to force district councils to pay, they would adopt it. There is a solution in my proposal. It will allow the Secretary of State to make enabling regulations. Even if the Government will not accept the new clause, I hope that they will assure the House that a more acceptable amendment will be introduced in the other place.

I commend the new clause. Its purpose is to make parish, town and community councils masters in their own homes, to ensure that funds intended for their use are passed to them and to demonstrate that Parliament fully appreciates the valuable work of small councils which are rooted in their neighbourhoods.