Is it not a fact that the Association of Metropolitan Authorities, the Association of County Councils and the Association of District Councils are all condemning the Government because of their attitude to rate capping? I am talking about Conservative-controlled as well as Labour-controlled authorities. Are not the Government creating the conditions for overspending by reducing the rate support grant from the 66·5 per cent. of only a few years ago to the proposed figure of 52 per cent.? That will affect the very inner city areas and partnership schemes which the Government say they support. In those areas there is the highest level of poverty and unemployment and the worst housing. They are the very areas that need Government support.
We made it clear at the election and in our manifesto that we would take action to control the high rates of those local authorities that spend irresponsibly and excessively. There is no doubt that their ratepayers are very anxious to see an end to that. I am coming under pressure to take action sooner rather than later.
Nevertheless, will my right hon. Friend take full account of the strong opposition expressed by most Conservatives in local government to his proposals as they have been presented to us? Will he note that elected local representatives in Conservative-controlled councils are just as concerned with the interests of ratepayers as he is?
My hon. Friend will have read the White Paper carefully and will know that the vast majority of councils that have done their best to keep their spending within the Government's guidelines have nothing whatever to fear from the selective rate capping proposals that I have put forward. Indeed, they have much to gain. I am being criticised because the autumn statement had to cut back the capital spending of local authorities on housing, and so on, because the current spending of local authorities had so far exceeded the guidelines which the House approved in the public expenditure White Paper. If we can cap the rates of the overspenders, the majority of councils can perhaps move into less turbulent waters.
I think that at the end of the meeting there was a much better understanding of how a council such as Warwickshire, which has budgeted responsibly over the years, would gain if we could bring under control the overspending of the few authorities which spend far in excess of targets. A council such as Warwickshire would stand to gain from that.
Can my right hon. Friend offer any hope to ratepayers in local authorities such as Humberside county council, who face the prospect of a very significant rate rise in the next financial year because of the loss of rate support grant for next year? Can my right hon. Friend offer them any hope prior to the introduction of his legislatiion?
If the councillors of Humberside county council tailor their spending to the targets that the Government have set, there is hope. The responsibility lies with them. However, the county council would be unwise to proceed with projects that could only increase the burden on its unfortunate rateapayers.
Is it not a unique achievement that the Secretary of State has united all three local government associations against his proposals? Do not his proposals mean that rate levels and local authority budgets will be dictated essentially from Whitehall? Are we not seeing the dictatorship of central Government over local government? Will that not result in more damage to services in many communities where people are already under severe strain as a result of the Government's policies?
I have much respect for the hon. Gentleman, but he is indulging in absurd hyperbole. There is no dicatatorship in the Government taking steps to ensure that the public spending guidelines, which are approved each year by the House, are observed by local government. Commercial and domestic ratepayers in areas of high rating local authorities are worried and have been calling for the Government to take such action for their protection.