Power to Prescribe Maximum Rates and Precepts

Clause 1 – in the House of Commons at 7:45 pm on 27th March 1984.

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Photo of Mr Charles Morrison Mr Charles Morrison , Devizes 7:45 pm, 27th March 1984

I beg to move amendment No. 25, in page 1, line 12, at end insert— '(lA) For the purpose of this part of this Act, the Secretary of State shall not designate more than twenty authorities in any financial year.' I did not speak on Second Reading, much as I should have liked to do so, because I was not fortunate enough to catch the eye of the Chair. Nor did I serve on the Committee and, therefore, this is the first occasion on which I shall make a speech about the Bill.

By way of introduction to the amendment I shall make my attitude to the Bill entirely clear: I am totally opposed to it. It centralises power. That is normally contrary to Tory philosophy, which believes in the diffusion of power. By centralising power, the Bill undermines the balance between central Government and local government, which, let it not be forgotten, has stood the Tory party in good stead, especially when it has been in opposition and has had to rely on Tory-controlled local authorities to stand out against the excesses of Socialism.

The Bill infers that the man in Whitehall knows best. That has never been a Tory principle and is damaging to local democracy. The Bill gives almost unlimited power to the Secretary of State over all local authorities and, conversely, whenever those powers are exercised, central Government will take the blame for inadequate services. Thus, the electoral consequences are obvious.

If, on the other hand, the Government do not use their powers under the Bill, should it be enacted, they will be blamed for the rate demand, be it high or low, responsible or irresponsible. None of us should forget that there is not much selectivity by those who complain about rates; many are simply against them. That being so, many will be totally disappointed by the Bill.

Unless the general powers are used—my right hon. Friend the Secretary of State said that that was unlikely —most rate powers will remain totally unaffected by the Bill. Therefore, the Bill raises political expectations which it will never achieve. That is dangerous, and the scope for a political backlash is considerable.

Be that as it may, the House gave the Bill a Second Reading, and we are now trying to improve it. Part I provides for the selective limitation of rates. The Bill should live up to its intentions more precisely; hence my amendment. The amendment states that no more than 20 local authorities should be designated in any one year. On Second Reading the Secretary of State said that he would designate between 12 and 20 local authorities in any one year. Thus, the amendment specifies his upper limit and incorporates the Government's stated intention.

In addition, it is worth remembering that the Secretary of State said that 75 per cent. of the overspend in 1983–84 could be laid at the door of 16 extravagant local authorities. He may say that the amendment is unnecessary as he will not go above 20 local authorities, and that is doubtless his intention, but his successors may feel less inhibited by his verbal undertaking.

Furthermore, in the past powers have tended to be used way beyond what was originally envisaged — for example, the experience following the introduction of targets. With regard to targets the 1980–81 rate support grant order records: It is intended that the power should be exercised—if at all —in such a way as to affect only a very small minority of authorities. By 1983–84 more than 160 authorities suffered grant penalties for exceeding their targets. The number may be even higher in 1984–85. It is important that the selective provisions in the Bill are clearly limited and visibly written into the Bill if the escalation seen in the past is not to be repeated.

Amendment No. 25 is a paving amendment and precedes amendment No. 31, which we shall reach tomorrow afternoon. It aims to remove the powers of general limitations of rates. Whatever hon. Members may think in support of the selective powers—I appreciate that a number of my right hon. and hon. Friends have sympathy for them—many hon. Members are opposed to the general powers. If the general power clauses, clauses 9 to 12, were removed from the Bill, nothing would prevent clause 1 from being applied as though it provided a general power. It is called selective, but in practice it could be, used generally. Thus, clause 1 must be limited in its scope. That is what amendment No. 25 seeks to do.

Photo of Jack Straw Jack Straw Shadow Spokesperson (Environment, Food and Rural Affairs)

I support the amendment. As the hon. Member for Devizes (Mr. Morrison) so eloquently explained, for all hon. Members concerned about the general powers it is an important probing amendment to discover the Government's real intentions with regard to the specific powers.

As the Bill is drafted, it would be open to the Secretary of State to use the selective powers to rate-cap almost every authority which exceeds the £10 million floor of grant-related expenditure. If he wanted a fig-leaf of selectivity, he could use various formulae to ensure that 10 authorities or so escape. None the less, under part I a selective scheme could lawfully rate-cap all the metropolitan district authorities, most of the London boroughs and most of the shire counties, including a large number of Conservative-controlled shire counties and metropolitan boroughs, as well as a few shire districts, leaving only the smaller shire districts excluded by clause 2(2)(a) and certain authorities, probably all Conservative-controlled, with expenditure so low that even the capricious and accidental effects of the Government's proposals would be unlikely to catch them. Experience shows, however, that a number of the 160 authorities to which the hon. Member for Devizes referred have been low spenders on any basis. Indeed, that is the basis of their complaints.

The amendment is unusual in that a similar proposal was the subject of extensive discussion in Committee. We are grateful to the Chair for recognising that its importance is such that it should be reconsidered on the Floor of the House. An extensive debate took place on 21 February on an amendment couched in similar terms. We sought to pin the Secretary of State down on two related questions. First, putting it crudely, was he prepared to put his signature where his mouth was and commit himself in law in a binding fashion to the undertakings that he gave to the House that he intended that only between 12 and 20 authorities should be subject to rate capping?

That is important, not because we do not believe the Secretary of State, or indeed any Minister speaking from the Dispatch Box—the right hon. Gentleman is a man of honour and we have come to recognise his many qualities in Committee—but because he is Secretary of State only for the time being. Even if the Government continue for their full term, it is highly unlikely that he will be Secretary of State for the Environment in 1987 or 1988. There are undoubtedly higher things in store for him. Given the cock-up that will occur when this measure comes into operation, I advise him to get out from under in double quick time and to find a nice safe haven, having served his term at the coal face as he surely has during the past year.

Previous Secretaries of State have made worthy and well-intentioned commitments which have then been stood on their heads by the subsequent actions of other Ministers. Conservative Members should weigh carefully the words of the present Secretary of State for Employment, formerly the Minister for Local Government and Environmental Services, the right hon. Member for Bridgwater (Mr. King) in March and April 1980 when he recommended the system of grant-related expenditure assessments. Referring to the needs assessment, he said: It is not suggested that it prescribes a specific level to which an authority ought to spend." — [Official Report, Standing Committee D, 1 April 1980; c. 941.] On 27 March 1980 the right hon. Gentleman used the words which are now becoming notorious but which bear repeating because it is important that political parties as well as individual politicians should be consistent. He said: My Department will not be in the business of saying how much each authority should spend, where it should or should not make cuts or on what it should spend money. I have tried to make clear that that is a matter for local authorities…We have specifically rejected that approach. We have said that our concern is the distribution of public money. That is an interesting use of the phrase "public money", as it clearly refers not to the totality of locally raised expenditure and central Government expenditure, but solely to the latter.

The right hon. Gentleman continued: Beyond that I am powerless to do anything about fixing the level of rates. I have made certain comments on my view, as I did in the House yesterday. Local authorities are autonomous. They fix their rate systems. I can comment and urge the need for economy. I have some influence over the distribution of public funds"— the term is again used to denote central Government expenditure only— but the ultimate decision on rating and on the volume of expenditure of local authorities is a matter for the councillors themselves" — [Official Report, Standing Committee D, 27 March 1980; c. 840–41.]

Photo of Jack Straw Jack Straw Shadow Spokesperson (Environment, Food and Rural Affairs)

Yes, it was, and if the Government had been consistent in that approach they would not be in the present mess and they would not be open to the charge from Conservative Members, to whom I must defer in this respect, of producing a Bill that is contrary to the principles of Toryism and takes the Government and the country down an alien, authoritarian road which the Government and their party will come greatly to regret.

8.15 pm

Those statements by the former Minister have been turned on their head because the GREA has become a specific level to which an authority ought to spend. Even worse, although the Under-Secretary of State, the hon. Member for Bristol, West (Mr. Waldegrave), claimed on Second Reading that GREAs would be just one of the criteria used by the Secretary of State to determine the rate-capping principles, the Secretary of State himself said subsequently in Committee that it was "the central criterion". Solemn undertakings given to the House by one Minister have been turned on their heads by another Minister in the same Government of the same party who simply happens to have a different body.

Photo of Jack Straw Jack Straw Shadow Spokesperson (Environment, Food and Rural Affairs)

Or a different edict or instruction. In a revealing slip of the tongue, if such it was, at Prime Minister's Question Time today the Prime Minister said that the Foreign Secretary had been "instructed" by her—not, I suspect, for the first time or indeed for the last time—to get a certain deal and that if he failed to do so——

Photo of Jack Straw Jack Straw Shadow Spokesperson (Environment, Food and Rural Affairs)

Yes, and it will no doubt happen at one of those 3 am meetings at No. 10. We are told that the prime Minister and the Foreign Secretary do not sleep before 4 am.

Photo of Mr Tony Banks Mr Tony Banks , Newham North West

And preferably not together.

Photo of Jack Straw Jack Straw Shadow Spokesperson (Environment, Food and Rural Affairs)

I am sure that they do not sleep together. [HON. MEMBERS Order!"] The suggestion came from the Conservative side. [HON. MEMBERS No."]

Photo of Jack Straw Jack Straw Shadow Spokesperson (Environment, Food and Rural Affairs)

I apologise. I am totally deaf in one ear, so I sometimes get the direction of comments wrong—[Interruption.] If the Secretary of State wishes to pursue a private argument with my hon. Friend the Member for Newham, North-West (Mr. Banks) I shall not interfere.

As the hon. Member for Birmingham, Selly Oak (Mr. Beaumont-Dark) said, probably as a result of an instruction or a change in the brief, solemn commitments given to the House in 1980 have been turned on their heads. Had the then Minister said in 1980 that GREAs were not just a method of distributing the rate support grant but were to be used in the future as a benchmark to determine the overall expenditure level for every authority, the mood of the House at that time would have been to reject the Bill as utterly unacceptable. That is the importance of the commitment given by the then Minister.

In Committee the Secretary of State said: I am happy to reiterate that we aim at a figure of between 12 and 20 authorities for capping. That is an order of magnitude figure. It would be foolish in the extreme to accept an amendment which precluded us from adopting perfectly sensible, straightforward and coherent principles if we needed to cap 21 or 22 authorities."—[Official Report, Standing Committee G, 21 February 1984; c. 575.] That is understandable, but there has to be a limit somewhere, otherwise we end up by turning the selective scheme into a general scheme. This is the amendment of the hon. Member for Devizes and I hope that I am not putting words into his mouth if I say that he might find it acceptable if the Secretary of State said, not 20, but 25, because that is an order of magnitude, and then the Secretary of State has some leeway.

Photo of Mr John Fraser Mr John Fraser , Norwood

That would include Lambeth.

Photo of Jack Straw Jack Straw Shadow Spokesperson (Environment, Food and Rural Affairs)

I am a ratepayer in Lambeth and I happily pay my rates. I know that a growing number of Conservative Members pay their rates in Lambeth. The number moving into that fine borough increases every day.

Photo of Mr John Powley Mr John Powley , Norwich South

Will the hon. Gentleman accept that there are some people who have recently moved into Lambeth, as I have, who deplore the level of rates that we have to pay?

Photo of Jack Straw Jack Straw Shadow Spokesperson (Environment, Food and Rural Affairs)

The hon. Gentleman must live in a very large house indeed. This is not the time to ask why he does not live in Lord North street, or elsewhere in Westminster, but I suspect that the level of rates may have something to do with it.

That is the first point, and it is a question of orders of magnitude. If this is a selective scheme, and if the Secretary of State is to be true to his word that it should be limited to between 12 and 20, let us call it 25, or 24, then we will know that this is a selective scheme. However much we may object to it, its purpose will be clear.

The second question which arises, and which we also debated at some length in Committee, is, as it were, the joker and the twist in the Secretary of State's argument. If this scheme is to be limited to 20 authorities, what are the savings to be? I repeat, because it is a central point and is worth repeating, that, try as we did in Committee to discover from the Secretary of State how he expected to make the savings he was being told by the Treasury to make within the context of a selective scheme, we were unable to arrive at an agreement on the figures.

The Secretary of State told us that the gross savings that he would be looking for under a selective scheme would be about £300 million. That may be the case, but that is gross and it is way below the figure which the Chancellor of the Exchequer is looking for by way of savings. I find it impossible to imagine that the Secretary of State would be able to achieve the rest of the savings simply by further manipulating the rate support grant proportion downwards and making the target ever harsher. If he does that, he and his hon. Friend the Member for Bristol, West will have to renege on another promise made in connection with the rate support grant —the categorical assurance that the shire counties, which have been so badly done by this year, would be helped next year. It is simply not possible to square these circles. To use another analogy, if we push one end, something else pops out of the other.

The figure of £300 million is a gross saving. By the time we have taken account, first, of the short-term loss of tax —since that amount will in the main be spent on wages and salaries of local government employees and if they are made redundant or there is natural wastage there will be less throw-back by way of income tax and indirect taxes to the Treasury—and, secondly, of the fact that if the Government succeed in cutting down the expenditure of individual authorities their entitlement to rate support grant will go up, the £300 million will certainly be down to £200 million, and maybe even less.

We had an example of this last Tuesday during the debate on the second supplementary report on the rate support grant for 1983–84, when we discussed the Government's failure to bring forward the report for 1982–83. As a result of the Greater London council spending less by £150 million than it anticipated, it is to receive a very substantial increase in its rate support grant. Furthermore, a large number of both Labour and Conservative authorities, including Labour Lancashire and, no doubt, Conservative Wiltshire, are to lose part of their rate support grant. Nothing illustrates better the way in which these mechanisms will operate. In that way and in other ways the Secretary of State's gross figure will be reduced to a net figure of not much more than £200 million, and probably a good deal less.

This will be even more inevitable if the Secretary of State remains true to the undertaking that he gave to the Committee and does not start with a bottom-line figure This, as I explained in the debate earlier today, follows what he said in Committee at column 591—that there is no question of criteria being chosen in relation to a predetermined requirement for savings. I do riot understand how the Secretary of State came to make that statement. given that time and again he and his colleague, the Under-Secretary, say that the whole purpose of the Bill is to secure public expenditure savings.

I wonder, too, what the Treasury thinks about it, because I am sure that the Treasury already has a very clear pre-determined idea of the amount that it expects the Secretary of State to save, and it will be handing him a chitty with the amount, which I dare say will say not £200 million, but about £1,500 million, and he will be required to produce it, unless the balance of forces within the Cabinet is not what we have been led to believe and the Secretary of State, not the Prime Minister and the Chancellor, really has all the votes. If that is true, I take my hat off to the Secretary of State, but what is the purpose of the Bill, except as a charade?

Photo of Mr Tony Banks Mr Tony Banks , Newham North West

Will my hon. Friend accept that, of this often-quoted £177 million variance in the GLC's budgeting for 1982–83, about two thirds comes from higher-than-expected receipts both from income which the council derives and from Government grants?

Photo of Jack Straw Jack Straw Shadow Spokesperson (Environment, Food and Rural Affairs)

I would, of course, accept that, and I think it is also important to point out that the decision of the Greater London council to budget at a level higher than its expenditure was the result not of irresponsibility, as the Secretary of State would claim, but of the GLC's being unable to anticipate the outturn because of all kinds of uncertainties—most of which have been placed in their way by the Government — the anticipation of higher interest rates, the level of fare subsidies, and so on. It was not anticipated that fare subsidies would produce such a high economic return as they did. The GLC would have been criticised even more if it had budgeted for less than it eventually spent.

This is a crucial amendment which tests the good faith not of the Secretary of State—we do not challenge that —but of the Government and their readiness to back what they say with legislation. It is a principle of the rule of law that what the Secretary of State says in the House cannot be tested in the courts and cannot even be adduced in evidence. Since the Secretary of State claims to subscribe so faithfully to the rule of law, we want his notions, his principles, to be translated into law. If this is a selective scheme, let it be a selective scheme. We give our support to the amendment.

Photo of Mr John Powley Mr John Powley , Norwich South

I wish to urge my right hon. Friend the Minister to reject this amendment, for reasons which I hope to put forward in the next few moments, but also for many more reasons of which I am sure he will think.

With respect, I say to my hon. Friend the Member for Devizes (Mr. Morrison), who moved the amendment, that I suspect that I might have agreed with it if it had been moved in similar circumstances some 20 years ago, when the situation in local government was rather different from what it is today. It is because of those different circumstances that I oppose the amendment.

I have had experience of working through three decades of local government during the 1960s, 1970s and 1980s. A great many Labour local authority members come from a different breed now. I know that looking back is easy and that past events look better when viewed in retrospect, but I am taking that into account. During the 1960s and 1970s, Conservative members of local councils had a great deal of respect for some of the distinguished Labour members with whom we had the honour to serve. We had political differences, but those Labour members approached local government with a different attitude from that now taken. Many Labour members on the council on which I served actually had the guts to tell those who wanted to spend more and more—their own supporters—that they could not afford to do that. They said that the rate level should be kept in moderation, and they earned a great deal of respect for that attitude.

Photo of Nick Brown Nick Brown , Newcastle upon Tyne East

I strongly agree with the hon. Gentleman's remarks about the great deal of respect for Labour members of local authorities. But his argument about the new breed of Labour councillors is hardly an argument against their election. If they are the choice of the electors, surely that is what matters.

Photo of Mr John Powley Mr John Powley , Norwich South

Had the hon. Gentleman allowed me to continue with my speech, his intervention would not have been necessary. I hope that he will appreciate the answer——

Photo of Mr Piers Merchant Mr Piers Merchant , Newcastle upon Tyne Central

I hope that when my hon. Friend answers the hon. Member for Newcastle upon Tyne, East (Mr. Brown) he will remember that the Labour group on the Newcastle city council has recently expelled four of its members.

Photo of Mr John Powley Mr John Powley , Norwich South

Indeed, my hon. Friend's comments form part of the argument, and I am grateful to him.

Labour members in the 1960s and 1970s told their supporters that they could not have certain things, even though it was not pleasant to do so. But since reorganisation in 1974, those elder statesmen have been replaced by a different type of councillor. I concede that they have been elected, but conditions have changed. They appear to have the idea that they were elected only to spend as much money as possible. Committee chairmen vie with each other——

Photo of Mr Jack Thompson Mr Jack Thompson , Wansbeck

The hon. Gentleman is falling into the trap of talking only about authorities in his area. My county is currently Labour-controlled, but 15 years ago it was Conservative-controlled. The difference between the two groups is minimal. The council consists of responsible councillors of all political shades—including a Liberal influence. That council certainly does not bear out the remarks of the hon. Gentleman and his hon. Friend the Member for Newcastle upon Tyne, Central (Mr. Merchant).

Photo of Mr John Powley Mr John Powley , Norwich South

The hon. Gentleman is entitled to his opinion, and I am sure that he respects our opinions as people who have served in local government.

There is a new breed of Labour councillors, and a substantial number of them are prepared to defy the Government. It appears to be the usual practice that when there is a Labour Government there is an upsurge in Conservative councillors, and vice versa. The previous Labour Government got the country into severe financial difficulties. The Conservative-controlled councils —some of them were Conservative-controlled for the first time in many years—realised the general decline in the country's economic position, and their management reflected that. When the Labour Government said that there had to be economies and cuts in housing, education and the National Health Service, Conservative councils generally went along with that. They accepted their responsibility, tried to contain their expenditure—many of my hon. Friends were leaders of local councils at that time—and actually reduced the rate levels. I am talking about a real reduction that did not take inflation into account. Certainly in Cambridgeshire we managed to achieve a reduction in the rate level from 14p to 13p and then to 12p—despite 20 per cent. inflation. We found it possible to make those economies.

Photo of Patrick Cormack Patrick Cormack , South Staffordshire

I appreciate my hon. Friend's comments, but they are not entirely relevant to the Bill. One of the most vehement critics of the Bill is our right hon. Friend the Member for Cambridgeshire, South-East (Mr. Pym).

Photo of Mr John Powley Mr John Powley , Norwich South

Our right hon. Friend is entitled to his view.

Where we once had a Labour Government but a majority of Conservative-controlled councils, we now have a Conservative Government with a significant number of Labour-controlled councils. Britain still has economic problems and needs to be put on a sound economic footing. But the Labour-controlled councils are prepared to defy the Government and fly in the face of economic reality. They will not take any notice of Britain's economic problems, which we inherited from the Labour Government, or the Conservative Government's remedies for them.

Photo of Nick Brown Nick Brown , Newcastle upon Tyne East

The Bill goes well beyond the expenditure argument. The hon. Gentleman referred to Labour councillors who were prepared to defy the Government. I remind him that many members of the Conservative party—many of them in the House—are prepared to defy the Government on this Bill.

Photo of Mr John Powley Mr John Powley , Norwich South

A vote in the House tonight or tomorrow is entirely different from defying the law of the land when a Bill has become law. I am sure that the hon. Gentleman accepts that. We have this new breed, and those people are prepared to defy the Government's exhortations. During the past four years, the Government have tried by persuasion to get local authorities to accept the realities of life, to cut their expenditure and to make economies. It is clear that a substantial number of Labour-controlled local authorities would deliberately gang up on the Government. With an amendment to restrict the number of local authorities to 20—the Secretary of State issued a list of 33 for this financial year — a substantial number of other local authorities would blatantly ignore the financial realities of life and go on spending without any regard for the cost of what they do. Liverpool is a prime example, but there are many others. If there were a limitation of 20, a substantial number would follow those 20 and exercise no restrictions.

I hand it to Labour-controlled local authorities that they know how to get together. I wish the Conservatives did as well. The Conservative group on the Norwich city council and the Norfolk county council support the Rates Bill. My two local authorities have seen the wisdom of what the Government are doing, and I am pleased to have their support.

The point is that Labour-controlled authorities get together. It is no coincidence that we have umpteen nuclear-free zones. I am sure that the instruction went out from Walworth road saying, "You are all to become nuclear-free zones", and they all passed resolutions to become nuclear-free zones. It was well organised.

Photo of Mr John Powley Mr John Powley , Norwich South

No, I have given way on a number of occasions, and I really must get on.

Those authorities had their instructions. I imagine that a number of Labour local authorities passed resolutions deploring the cuts in the National Health Service. Certainly I received a resolution from Norwich city council to that effect, and I am sure that a number of other Labour local authorities passed the same resolution, probably word for word. They are well organised. I have no doubt that if there were a limitation of 20 authorities to be rate capped, their organisation, to which I again pay credit, would so engineer the situation that umpteen other Labour-controlled local authorities would exceed their expenditure, and the Government would then be in a far worse position.

I hope that the Bill will bring home to local authorities the fact that they have to accept financial responsibilities. It has been demonstrated that some local authorities have accepted their responsibilities and can work within the financial guidelines. If so, the necessity for this legislation disappears out of the window. We shall not have 20 local authorities to which it will apply; we shall have none at all. The country will be in a far better position if the Bill achieves that result in local government.

Photo of Mr Tony Banks Mr Tony Banks , Newham North West

I am grateful to the hon. Member for Norwich, South, (Mr. Powley) for explaining the reasoning of an important section of his party. Perhaps he would classify me as one of the new breed of councillors. I am a member of the Greater London council, and I should point out to him, in case he is classifying me as one of the new breed, that I have served continuously on a local authority for the past 14 years. I do not know whether that fits his interpretation of "new", but I am perhaps not as new in local government as he might suggest.

8.45 pm

The hon. Gentleman spelt out something that his right hon. Friend the Member for Chingford (Mr. Tebbit) also spelt out clearly in a speech that he made at Caxton hall the other evening. It went on to the broader issue of the restructuring of local government. Perhaps I may quote what the right hon. Gentleman said: the Labour Party is the Party of division. In its present form it represents a threat to the democratic values and institutions on which our parliamentary system is based. The Greater London Council is typical of this new modern, divisive version of socialism. It must be defeated. So we shall abolish the Greater London Council. That is what the right hon. Member for Chingford said, and I have no reason to disbelieve him. The GLC is being abolished because it is controlled by a party with which Conservative Members fundamentally disagree. The hon. Member for Norwich, South says that because certain people, of whom he does not approve, have been elected —I remind him that, new breed or not, they were all elected through the ballot box—and he does not agree with them, therefore this draconian measure is being introduced. It is a baby-out-with-the-bathwater form of legislation, and it is clearly unacceptable to both sides of the House in important respects.

Photo of Christopher Chope Christopher Chope , Southampton, Itchen

Why was it, when the new GLC was elected, that one of the first things it did was to reduce the proportion of Conservatives on the committees to well below the pro-rata representation of a minority party, which had existed before the Left-wing Labour GLC took over? Was not that an example of the new Socialist so-called democracy in practice?

Photo of Mr Tony Banks Mr Tony Banks , Newham North West

That was hardly a question. It was more a statement of the hon. Gentleman's bigotry. It is normal practice for any administration to wish to secure its own business, and it will take steps to ensure that its business is properly administered and carried out. So what the Labour GLC did was nothing out of the ordinary, bearing in mind the fact that it has been done by Conservative and Labour administrations for many years. There was nothing extraordinary about that.

The hon. Member for Norwich, South went on to say that not only were these local authorities controlled by this new breed, but that they were daring to defy the Government. One reason why our democracy, despite the attacks made on it, manages to hold up reasonably well is that there are checks and balances between local government and central Government. The hon. Gentleman came out with the psephological fact that there is an inverse correlation between the party that is elected at a local election and the party of the Government in power. That has always been so, and long may it remain so. At local elections, people tend to see the Government of the day and vote the opposite way. One has only to look at recent elections to see that that inverse correlation holds true. So I do not see why local authorities should obey the wishes of central Government, because as soon as that happens—it will happen now, as a result of this Bill—there will be a form of centralisation that is bad for democracy and, in my view, bad for local government.

I am glad that the amendment has a certain amount of cross-Chamber support. There has always been conflict between central and local government and, as I said earlier, that is a mainstay of the democratic process. I am sure that the hon. Member for Norwich, South would approve of Herbert Morrison, that well known former Labour Member who took a very muscular approach towards central government.

There would have been no Festival of Britain, which everyone acclaims, if it had not been for Morrison deciding to defy the Government of the day. There would have been no new Waterloo bridge if it had not been for him. I am sure that the hon. Member for Norwich, South would regard Herbert Morrison as the archetypal Labour Member. In fact, if the hon. Member had been around at the time, Herbert Morrison would have been denounced by him as someone who spat in the face of Government.

Photo of Mr Anthony Beaumont-Dark Mr Anthony Beaumont-Dark , Birmingham, Selly Oak

Herbert Morrison was, at the time of which the hon. Gentleman is speaking, Home Secretary in the then Labour Government and was certainly not leading the then LCC. Is he suggesting that, whenever somebody leaves local government, that person is still in local government? What is the logic of his argument?

Photo of Mr Tony Banks Mr Tony Banks , Newham North West

As the hon. Member for Norwich, South had been keen to speak of former Labour local government people, I was demonstrating that there had always been conflict between central and local government, and certainly that was the case between the old LCC and central Government. Herbert Morrison was able to straddle both places with the aplomb that few hon. Members could reveal today.

If the Secretary of State wants us to take him at his word, he should accept the amendment. We have had experience in Committee and elsewhere of Secretaries of State saying, "Take my word that these powers will never be used." Bad legislation is based on the good intent of the Secretary of State of the day. The GLC—returning to that favourite creature of us all—ran foul of the Law Lords over the interpretation of the Transport (London) Act 1969. A reading of Hansard at the time of the passage of that measure would have made it clear that the then Minister of Transport believed that the GLC had the powers that the Law Lords said it did not have. However, as we know, the Law Lords are not allowed to read Hansard in reaching a conclusion, and rightly so, I suppose.

One can see the basic weakness in having the views and opinions of a Secretary of State subsumed in a piece of legislation. When that Secretary of State passes on to the great parliament in the sky or to another place, there is no one to read into the legislation what he thought when the legislation was going through.

Therefore, all the assurances of the present Secretary of State, genuine and sincere though no doubt they are, are not worth the air that he uses to voice them nor the paper on which they are written. The right hon. Gentleman must convince us, and if the Bill will not affect more than 12 to 20 councils that should be written into the Bill. I doubt whether the right hon. Gentleman will accede to that cross-Chamber request because, returning to the question of the continual conflict between local and central Government, whichever party has been in control at the centre, it has always tried to curtail the powers of local government, and that goes as much for Labour as for Conservative Administrations. The Secretary of State is doing what Many Ministers in his position have wanted to do, which is strictly to curb the powers of local government, and the right hon. Gentleman has been able to use the advantage of what he regards as one or two high-spending local authorities to curb all local authorities.

The right hon. Gentleman would be seen in a better light if he specified the local authorities he wishes to curb. Let him name, for example, the GLC, the ILEA, Islington council and a few others. I appreciate that it would be unusual to write their names into legislation, but at least the right hon. Gentleman should specify the numbers that he has in mind, because it should not be all local authorities.

The right hon. Gentleman is sheltering behind what he sees as the high-spending record of the GLC and the ILEA to do what many Secretaries of State before him have only dreamt of doing, and that is to curb local government and to bring in a degree of centralisation which is anathema to democracy in Britain.

Photo of Mr Geoffrey Rippon Mr Geoffrey Rippon , Hexham

It is a sad fact of life that it is much easier to support a Government Bill and go through the Lobby if one does not know what Bill one is supporting. It is even easier if one has not listened to the arguments.

Further to the remarks of my successor and hon. Friend the Member for Norwich, South (Mr. Powley), it may be that there is a new breed of Socialists. Perhaps there is a new breed of Conservatives also. In the days of Alderman Sir Arthur South, Norwich had a moderate and reasonable Socialist council. It had excellent relations with the Conservatives and it shared the various chairmanships, including that of lord mayor from time to time. It was all most amicable.

It may be a little easier for a Conservative Member of Parliament to be elected there now. At any rate, there were not enough — boundary changes have made some difference — Conservative supporters in my time to secure my continuance as the hon. Member for Norwich, South, which I would have liked to have done. However, I am glad that my hon. Friend who now represents that constituency is here. It may be that the electors of that constituency voted for him because they did not much like the new breed of Socialists.

These are the sorts of decision that must be taken by local people. We cannot say, "The people we like shall be free but the people we do not like shall not be free." We cannot pick and choose freedoms. Local people must have the opportunity to make up their own minds.

One can think of what happened in the 19th century at the time of local government reform. Professor Maitland said, in effect, "These new local authorities must be free, free if necessary to make mistakes on quite a big scale. In any event, they will normally be less serious than the mistakes which Governments make from time to time."

It is nice to hear someone speak in favour of the Government. My hon. Friend spoke sincerely and well, but he must understand that nobody is saying that the Government should be defied. We do not have a system under which local authorities can do what they like unless it is expressly forbidden but a system under which local authorities can act only if they have the statutory power, and frequently a statutory duty goes with that statutory power. If a local authority abused its powers and defied the Government in the sense that it defied the statutes that the House has passed, most of us would have no sympathy with it. However, we have said time and again—I have said it as a Minister and as a Conservative Opposition spokeman on local government affairs — that local authorities are not bound by exhortation or circulars that do not have the force of law.

Photo of Mr William Benyon Mr William Benyon , Milton Keynes

Will my right hon. and learned Friend make it clear that those of us who have grave reservations about the Bill are in no way condoning local councils breaking the law?

9 pm

Photo of Mr Geoffrey Rippon Mr Geoffrey Rippon , Hexham

I entirely agree with my hon. Friend. I see no difficulty in supporting the principle of rate capping provided that the criteria are clear, we know what we are doing and we do not give unfettered discretion to the Secretary of State to pick and choose.

It is possible to make out a case for selective rate capping. The Government have been extremely careful to make it clear from the quotations which have been given from the White Paper and the Secretary of State's speeches that they have in mind only a selective scheme that is intended to apply only to a small number of local authorities. The Secretary of State said in Committee that that number would be 12 to 20. It is a little premature for my hon. Friend to assume that the Secretary of State will not welcome an amendment such as this. I see no reason why he should not welcome it. I said 12 or 20, but it might be wise to go to 25.

I see no reason why, if further powers are needed, the Secretary of State should not introduce fresh legislation. This is a rather draconian power. It means that when the Secretary of State rate caps a local authority he is going close to putting in commissioners. He has got to the point at which he will have to bear responsibility for any failure of the services that a local authority might have provided. If, for example, there were pollution of a river and the local authority had to go to court to face an injunction, its defence would be, "We cannot help it. It is the Secretary of State who has prevented us from carrying out our statutory duty." When the Secretary of State rate caps an authority, he puts himself into the local authority's shoes and supersedes the decisions of a duly elected local authority.

Photo of Patrick Cormack Patrick Cormack , South Staffordshire

Does my right hon. and learned Friend agree that some of the most unpleasant events on picket lines illustrate how necessary it is for local authorities to have flexibility in the amount of money that they spend on the police?

Photo of Mr Geoffrey Rippon Mr Geoffrey Rippon , Hexham

It has always been understood that local authorities must have discretion to determine local needs. It is for that that they raise rates, and for that they are responsible to the ratepalyers. We have had many arguments about the need to reform the structure of local government finance to make it fairer and to reduce the burden of rates. I should like such legislation. However, we are now discussing a draconian power of the Secretary of State to interfere in the discretion that is normally provided by statute for elected local authorities. It must be used carefully, with discretion and rarely.

I think that 20 is not unreasonable and sufficient for the Secretary of State's purposes. If he says that he would accept 25, so be it. It would be wrong to provide a power that could be extended almost to the point of being a general power. There is no cause for complacency when we know that, during discussion on the Local Government Finance Act 1982, the same argument was advanced—only a few authorities were to be affected by targets. What was at first a handful has now increased to 160 or possibly even more.

In those circumstances, I hope that the Secretary of State will be inclined seriously to consider accepting an amendment such as this or another in a similar form.

Photo of Mr Patrick Jenkin Mr Patrick Jenkin , Wanstead and Woodford

I am tempted to be beguiled by the charms of my right hon. and learned Friend the Member for Hexham (Mr. Rippon) and of my hon. Friend the Member for Devizes (Mr. Morrison), but I have to say that I shall not be able to advise the House to accept the amendment. My right hon. and learned Friend the Member for Hexham said that no one is saying that the Government should be defied.

Listening to the protestations of democratic probity that came from the hon. Member for Newham, North-West (Mr. Banks), I was reminded of the brief and sharp exchange that he and I had at the end of Question Time on 8 February. I said: The House might be more impressed if, instead of asking that rather pointless question…the hon. Gentleman stood up and told us whether he supports Mr. Livingstone's demand that the Labour party should defy the law on rate-capping. Will he or will he not?Mr. Banks: Yes." —[0fficial Report, 8 February 1984; Vol. 53, c. 879.] The whole House heard him. My right hon. and learned Friend has said that no one is suggesting that the Government should be defied. I fear that he is sadly mistaken, because the hon. Member for Newham, North-West made his intentions perfectly clear.

Photo of Mr Geoffrey Rippon Mr Geoffrey Rippon , Hexham

With respect to my right hon. Friend, I was not suggesting that no one would ever defy the Government. I was merely saying that Conservative Members, who are deeply and bitterly opposed to the principles underlying the Bill, are not saying that if it became law it should be defied. We are saying that it should not become law.

Photo of Mr Patrick Jenkin Mr Patrick Jenkin , Wanstead and Woodford

I understand my right hon. and learned Friend's view. I thought that at one point he was wavering in his opposition. He said that possibly a power of selective rate capping would be appropriate if the criteria and limitations were clear. I am grateful for that.

Photo of Mr Patrick Jenkin Mr Patrick Jenkin , Wanstead and Woodford

Does the hon. Gentleman wish to intervene?

Photo of Mr Tony Banks Mr Tony Banks , Newham North West

I am waiting for the right hon. Gentleman to finish his sentence.

Photo of Mr Patrick Jenkin Mr Patrick Jenkin , Wanstead and Woodford

I have moved on from the hon. Gentleman, but I shall give way.

Photo of Mr Tony Banks Mr Tony Banks , Newham North West

I had deferred to older and more senior Members. I am grateful to the Secretary of State for allowing me to underline what I said in answer to his question. It was strange to have a Secretary of State ask a Back Bencher to reply to a question. I believe that bad laws should be defied. There is a long and honourable tradition of bad laws being defied. Had that not been the case, there would not have been votes for women or trade union rights, by which everyone now swears. Therefore, there is nothing strange in any hon. Member saying that he or she is prepared to defy a law and take the consequences.

Photo of Mr Patrick Jenkin Mr Patrick Jenkin , Wanstead and Woodford

I am glad that I gave way to the hon. Gentleman. Having that put so clearly on the record by a Member of this legislature marks the hon. Gentleman's contribution to the debate. The hon. Gentleman will not be allowed to forget those words. He is elected to this House to help to make laws. To stand up in the House and demand that laws should be defied is to betray the very democratic principles about which he was speaking earlier.

Photo of Jack Straw Jack Straw Shadow Spokesperson (Environment, Food and Rural Affairs)

The right hon. Gentleman's criticism of my hon. Friend should not be allowed to pass, because this is an important point. How is what my hon. Friend said different from the Prime Minister's proposition that the laws to which we are bound by treaty under the European Communities Act should be defied by the Government?

Photo of Mr Patrick Jenkin Mr Patrick Jenkin , Wanstead and Woodford

My right hon. Friend has made no such proposition. It is perfectly clear, at least to Conservative Members, that if any such proposition were ever to be made—and this is entirely hypothetical—it would be made in the entirely constitutional way of changing the law in this House. But perhaps we are straying from the amendment.

Photo of Mr Patrick Jenkin Mr Patrick Jenkin , Wanstead and Woodford

There is no question of double standards. I was somewhat surprised at the logic of the argument of my hon. Friend the Member for Devizes. He suggested that amendment No. 25 was a paving amendment for No. 31. Amendment No. 31, which I hope we shall discuss tomorrow, will, if carried, remove part II.

At the same time, my hon. Friend argued that the danger of part I was that, although we have debated it on the assumption — perfectly properly, as it is the Government's policy — that it is a selective capping power, part H is a general power. If there were no part II, I have to ask my hon. Friends whether there would not then be every possible temptation on the Government to seek to extend the use of part I, because there would be no alternative other than to come back to the House. If we have part II, which is the general scheme and which has properly built into it certain provisions—this has been acknowledged by hon. Members in Committee and on Report — and if part H is hedged about with parliamentary and other safeguards, that is the proper and democratic way to do this.

Therefore, if the circumstances ever did arise—I do not want to anticipate tomorrow's debates—and a more general capping power would be needed, there is the procedure, and the opportunity is open to the Government to come back to the House of Commons and the House of Lords and explain the reasons and seek the necessary powers under clause 9.

Photo of Patrick Cormack Patrick Cormack , South Staffordshire

Will my right hon. Friend accept that if his thesis has any validity it is better to limit the number to 20 or 25, as has been suggested? If it does not work, my right hon. Friend has a case for coming back to the House for a new Bill. Why tag on these general powers and have an open-ended number without any restrictions?

Photo of Mr Patrick Jenkin Mr Patrick Jenkin , Wanstead and Woodford

I was perhaps led astray by the argument of my hon. Friend the Member for Devizes and was anticipating tomorrow's debate. I shall be happy to answer the question asked by my hon. Friend the Member for Staffordshire, South (Mr. Cormack) if we get there. Suffice it to say that we are debating part I on this amendment, No. 25, which would limit the numbers. If there were no part II there would be a stronger case for putting a limit on, because the pressures on the Government would be to seek to achieve what must be a Government's perfectly proper objectives of containment of public expenditure and the protection of ratepayers by going further under part I than it is our intention to do. That part of my hon. Friend's argument does not stand up.

Photo of Mr William Benyon Mr William Benyon , Milton Keynes

My right hon. Friend's speech anticipates the questions that I would have asked him if I had caught Mr. Speaker's eye. Is it really true, as is stated in the brief that has been prepared for us by three local authority associations, that there is no limit whatever to the number of authorities to be designated? If it were to be 50 or 100, what would happen on the Floor of the House?

Photo of Mr Patrick Jenkin Mr Patrick Jenkin , Wanstead and Woodford

My hon. Friend anticipates my arguments, because I am going on to explain to the House how part I limits the power. It is not just open discretion. I made it clear on Second Reading and at considerable length in Committee, when we debated the matter on a number of different amendments, and I am prepared to make it clear again now. Under part I we are concerned to curb the spending and rating of the small minority of councils which have ignored all our efforts over the past four years at influence and persuasion. The Bill provides for the selection of those authorities according to general principles and we shall eventually choose the criteria for those principles in the light of the most up-to-date information. Again that is provided for in the Bill, and it will be in the 1984–85 budgets of local authorities. As that information becomes available, so we shall be able to devise our principles.

9.15 pm

The Bill contains a number of safeguards. If an authority is selected, it will be one which is spending excessively. We have said that in present circumstances we consider that the number of authorities which would fall within that description would be between 12 and 20. There are the exemptions that no authority spending below GRE and no authority spending below £10 million a year, a figure which can be increased by order, could be selected. The majority of authorities need have no worry about selective limitation.

My hon. Friend the Member for Milton Keynes (Mr. Benyon) was not a member of the Standing Committee, but he will be aware of the debates which took place on the table which I made available to hon. Members and the press in which were set out the sorts of criteria which are in our minds to use when we come to make the selection. I spelt out in the table about 11 circumstances, or combinations of circumstances, which might be used. I shall not read them all out, but I shall give one or two examples. One example is an authority whose total expenditure is 20 per cent. over GRE and 2 per cent. over its target. An authority in another group would be one with total expenditure that is 20 per cent. above GRE and whose current expenditure has increased by more than 80 per cent. since 1978–79. A third example is an authority whose total expenditure is 20 per cent. above GRE and which has added 20 per cent. to its rates since 1981–82. There is a range of criteria, and every example shows that we are proposing to deal with only a few extremely high-spending and high-rating authorities.

Photo of Mr Geoffrey Rippon Mr Geoffrey Rippon , Hexham

Does my right hon. Friend realise that that is what worries most of us? He has said that we shall in due course choose the principles in the light of the most up-to-date circumstances. In other words, the list is by no means exhaustive. The principles could be changed at any time, either by him or his successor. Though the list might well be used, it might not he. There is a real danger that a future Secretary of State might say to his Department, "If those are the principles, let fresh principles be found."

Photo of Mr Patrick Jenkin Mr Patrick Jenkin , Wanstead and Woodford

My right hon. and learned Friend will forgive me for saying that these are paths that we trod in Committee. He will know that the Bill provides that the principles shall be laid before the House. It was argued that there should be a statutory opportunity to debate the principles. When my hon. Friend the Under-Secretary of State replied to the debate in which that argument had been advanced, he undertook to consider whether there was some weight in that argument. I feel that there is something in the argument.

One of the strengths of our case is that the orders that will be the end of the capping process will have to be debated in the House. That is an entirely appropriate requirement. We are considering whether it would be right to provide a statutory opportunity for a debate on the principles. I think that that would go a long way, if that were so—I am speaking without commitment at this stage—to meet the problem of arbitrariness of which my right hon. and learned Friend is complaining. I am conscious of that argument and, indeed, I made it clear that one of the reasons for the Bill being drafted in its present form is that it would not necessarily be appropriate to have a constant set of principles year after year. Provided that the principles used are clear at the beginning of the process, because the Government would need the support of the House, that is a proper and appropriate way to deal with the matter.

The amendment asks for a fixed limit of 20 designated authorities. I must make it clear that the Government have never been rigid about the number of authorities. We have referred to 12 to 20 authorities to give some idea of the number involved. The very existence of a range shows that we cannot be precise about the number selected.

I cannot tell the House with certainty that it would not be necessary in any year, based on clearly established principles appropriate at the time, to select one or two more than 20 authorities. If a consistent set of coherent principles were drawn up with, say, 23 authorities clearly separated from the rest, it would not make sense if the only way in which the Government could reduce that list to 20 would be to use two or three decimal places of expenditure above GRE, or some other limit set over time.

As I have shown, the list that was discussed in Committee — I was grateful for its welcome by Committee members, as the Government try to be as open as possible in explanation— was remarkably robust in the criteria and mixes of criteria that might be used, but the total came to 20 again and again. Some combinations would bring about a total of 16 authorities, and others as many as 22 or 23 authorities.

A coherent and clear set of principles could be devised and laid before the House to produce a figure marginally above 20 authorities. If so, a maximum of 20 would be unnecessarily restrictive. A Secretary of State should be entitled to do that, even though the number was more than 20, rather than have to twist and distort the principles to reach a maximum figure of 20. That is why I ask the House to reject the amendment.

Photo of Jack Straw Jack Straw Shadow Spokesperson (Environment, Food and Rural Affairs)

May I pick up the right hon. Gentleman's comment that he would not wish to be unduly restrictive?

We understand that we may extend the number of authorities by one or two over 20, and it was suggested that 25 should be acceptable. I do not understand why that limit is not acceptable if the Secretary of State is confident that his good intentions, which we do not challenge, will be translated into Government policy when he is in office and in later years. When will the Secretary of State return to the frequent suggestion that the real reason why he does not wish to be unduly restrictive is that the White Paper requires local authorities to cut their expenditure totals by £1·5 billion by 1986 to 1987? That cannot be achieved by selective schemes.

Photo of Mr Patrick Jenkin Mr Patrick Jenkin , Wanstead and Woodford

I had intended to deal with that point before sitting down, as the hon. Gentleman referred to it earlier. I seek the modest flexibility described to the House for the reasons stated and not in relation to the expenditure figures. I remind the House that the White Paper figures for public spending over the past few years have had to be raised each year to take into account the changing spending pattern.

Local government is now spending £2·5 billion above what was planned in 1980. That is a measure of how far adrift we have been. As a result, the public expenditure White Paper figures were raised by £1,000 million in 1982–83, by £1,100 million in 1983–84 and by more than £500 million in the current year. It would not altogether surprise me or, I suspect, my right hon. and learned Friend the Chief Secretary to the Treasury if we had to come back to the House to recognise the reality of the spending pattern of local authorities.

However, with the greatest respect, that is only part of what the Bill is about. Under part I, the only part which we hope we ever have to implement, for the first time we shall be able to put an effective upper limit on the spending and rating of the few authorities which have contributed the overwhelming proportion of overspending over the year. Other Ministers and I have been grateful for this. Some of my hon. Friends said that they recognise the need for that and support the legislation. Nobody welcomes the Government having to take such powers. As I have said again and again, I hope that we shall reach the position where no capping——

Photo of Mr Harry Cowans Mr Harry Cowans , Tyne Bridge

While the Secretary of State cannot argue how many local authorities he can trap under part I, because he cannot put a ceiling on it, can he explain why he needs to put part II into the legislation at all?

Photo of Mr Patrick Jenkin Mr Patrick Jenkin , Wanstead and Woodford

Perhaps the hon. Gentleman was not in the House when we mentioned that matter. We shall come to it tomorrow, when other amendments will be discussed and when I hope to catch your eye, Mr. Deputy Speaker, so that I can answer such questions.

I can go one stage further, as these matters are related to the problems of the low-spending authorities. If under the Bill we can begin to cap the spending of the irresponsible high spenders we shall be able to help the lower spenders. Of course, we are subject to overall spending constraints, but we shall increase the total provision for local authorities' current expenditure as new information on budgets becomes available, as we have done in recent years. It is our firm intention to stick to our overall plans for future years so that if yet again we have to increase the planning figures for local government current expenditure we shall have to achieve that within the overall planning totals in the White Paper published on 16 February.

I have constantly reaffirmed—the Government will live up to it—the undertaking that my hon. Friend the Under-Secretary and I gave in the rate support grant debate that, as the capping begins to take effect, we shall be able to take greater account of the efforts of low-spending authorities to keep their spending within the guidelines laid down by Parliament. If we are to do that effectively, we must have reasonable flexibility in interpreting part I.

I hope that I have explained to the satisfaction of my hon. Friends that it would unduly tie the Government's hands if we were pinned down to a figure such as 20, suggested in the amendment moved by my hon. Friend the Member for Devizes. Therefore, I hope that the House will reject the amendment.

Photo of Mr William Benyon Mr William Benyon , Milton Keynes

I rise with trepidation, first, because I realise that the amendment moved by my hon. Friend the Member for Devizes (Mr. Morrison), which I support, is dependent upon other amendments that will be moved subsequently, and, secondly, because I was not a member of the Committee.

The explanation of my right hon. Friend the Secretary of State was difficult to understand. Why jib at not accepting 25, if he does not like 20? It is rather like Lot's wife, and saying, "Peradventure there is one person does not offend".

I am concerned about the brief that we received from the three local authority associations. At present under the powers there is a limit to the number of local authorities to be designated. However, my hon. Friends must take on board another fact. I direct my remarks particularly to my hon. Friend the Member for Norwich, South (Mr. Powley).

9.30 pm

There is no limit to the number of authorities included in any order made under the procedure. For the sake of argument, let us say that there are not 20 authorities but 30. On one night in the future, 30 authorities, perhaps including Norwich because its composition has changed in a local election, will be considered in a one-and-a-half hour debate on an order. My hon. Friend will be lucky if he gets three minutes to speak. The authorities will have been approached and will have been asked whether they wish to make any appeal against the order. Their views will have come back, and will have been rejected. My hon. Friend will need to stand up in the House——

Photo of Mr William Benyon Mr William Benyon , Milton Keynes

If he gets in—and make the case for Norwich to have so much money for education, dustbins, and so on.

Photo of Mr John Powley Mr John Powley , Norwich South

My hon. Friend might take note of the fact that I have already advised my local authority, Norwich city council, that it is likely to be rate capped, according to the examples given by my right hon. Friend the Secretary of State. In my opinion, humble though it might be, the council could engineer its finances so that it would not be rate capped and the measure was unnecessary.

Photo of Mr William Benyon Mr William Benyon , Milton Keynes

I return to the charge that any number of local authorities might not be so well advised as my hon. Friend. What happens in those circumstances on the Floor of the House? I cannot believe that this is how a democratic system should work. I hope that, especially when my hon. Friends vote on this subject, they will imagine themselves—as I do as the representative of Milton Keynes—arguing in a one-and-a-half hour debate on an order into which their authority, for better or worse, has got itself.

Photo of Mr Charles Morrison Mr Charles Morrison , Devizes

My hon. Friend the Member for Milton Keynes (Mr. Benyon) has stated the argument with his usual good sense. The hon. Member for Newham, North-West (Mr. Banks) suggested that the Secretary of State — I think that I am almost quoting the hon. Gentleman—was doing what many of his predecessors wanted to do. That may or may not have been true. If it is true, it demonstrates one of the great differences between members of the Government and Members of Parliament. Members of the Government are concerned with the exercise of power, and, not surprisingly, therefore wish to take the greatest amount of power unto themselves. Members of Parliament are concerned with ensuring that there is an adequate check on that power. Never before in recent times have any Government had a majority the size of the present Government's. If the hon. Gentleman was correct, it has been known by successive Governments in post-war days that they could not carry a measure such as this one against not only the Opposition but some of their own members. I hope that that is not the position that my right hon. Friend is proposing in the Bill. If it is, it is shameful.

In this amendment, we are trying, as my right hon. and learned Friend the Member for Hexham (Mr. Rippon) said, to control the draconian power to interfere held by the Secretary of State for the Environment. Nothing that my right hon. Friend the Secretary of State said militates against the inclusion of a limit on the number of local authorities that can be caught under the selective scheme. Very much the opposite is true. My right hon. Friend has confirmed my worst fears. He did not accept the amendment, and went on to confirm what I said when I moved the amendment—that, if there was no part II, the Government would use part I. I emphasise the point made by my hon. Friend the Member for Milton Keynes. My right hon. Friend should look not only at the amendment dealing with the removal of the general powers but at other amendments dealing with clause 2.

My right hon. Friend referred also to the safeguards in clause 2(2)(b). That refers to the Government's opinion on whether a local authority appears to have proposed total xpenditure that is excessive having regard to general economic conditions. That is a general point. I do not believe that the inclusion of such a broad control is adequate to meet the point that I have made. I feel strongly that my right hon. Friend should have been prepared to accept the amendment. As he is not prepared to do so, I hope that the House will divide on it.

Question put, That the amendment be made:—

The House divided: Ayes 196, Noes 288.

Division No. 207][9.36 pm
Adams, Allen (Paisley N)Corbett, Robin
Alton, DavidCorbyn, Jeremy
Anderson, DonaldCowans, Harry
Archer, Rt Hon PeterCraigen, J. M.
Ashdown, PaddyCrowther, Stan
Ashley, Rt Hon JackCunliffe, Lawrence
Atkinson, N. (Tottenham)Dalyell, Tam
Bagier, Gordon A. T.Davies, Rt Hon Denzil (L'lli)
Banks, Tony (Newham NW)Davies, Ronald (Caerphilly)
Barnett, GuyDavis, Terry (B'ham, H'ge H'l)
Barron, KevinDeakins, Eric
Beaumont-Dark, AnthonyDixon, Donald
Beckett, Mrs MargaretDobson, Frank
Beggs, RoyDubs, Alfred
Beith, A. J.Dunwoody, Hon Mrs G.
Bennett, A. (Dent'n & Red'sh)Eadie, Alex
Benyon, WilliamEastham, Ken
Bermingham, GeraldEdwards, Bob (W'h'mpt'n SE)
Bidwell, SydneyEllis, Raymond
Blair, AnthonyEvans, John (St. Helens N)
Boothroyd, Miss BettyEwing, Harry
Boyes, RolandFatchett, Derek
Bray, Dr JeremyFaulds, Andrew
Brown, Gordon (D'f'mline E)Field, Frank (Birkenhead)
Brown, Hugh D. (Provan)Fields, T. (L'pool Broad Gn)
Brown, N. (N'c'tle-u-Tyne E)Fisher, Mark
Brown, Ron (E'burgh, Leith)Flannery, Martin
Bruce, MalcolmForrester, John
Buchan, NormanForsythe, Clifford (S Antrim)
Callaghan, Jim (Heyw'd & M)Foster, Derek
Campbell-Savours, DaleFoulkes, George
Canavan, DennisFraser, J. (Norwood)
Carlile, Alexander (Montg'y)Freud, Clement
Carter-Jones, LewisGarrett, W. E.
Cartwright, JohnGeorge, Bruce
Clark, Dr David (S Shields)Gilmour, Rt Hon Sir Ian
Clarke, ThomasGodman, Dr Norman
Clay, RobertGould, Bryan
Cocks, Rt Hon M. (Bristol S.)Hamilton, James (M'well N)
Cohen, HarryHardy, Peter
Coleman, DonaldHarman, Ms Harriet
Concannon, Rt Hon J. D.Harrison, Rt Hon Walter
Conlan, BernardHart, Rt Hon Dame Judith
Cook, Frank (Stockton North)Haynes, Frank
Cook, Robin F. (Livingston)Heffer, Eric S.
Hogg, N. (C'nauld & Kilsyth)Pendry, Tom
Holland, Stuart (Vauxhall)Penhaligon, David
Home Robertson, JohnPike, Peter
Howells, GeraintPowell, Rt Hon J. E. (S Down)
Hoyle, DouglasPowell, Raymond (Ogmore)
Hughes, Dr. Mark (Durham)Prentice, Rt Hon Reg
Hughes, Robert (Aberdeen N)Prescott, John
Hughes, Roy (Newport East)Radice, Giles
Hughes, Sean (Knowsley S)Randall, Stuart
Hughes, Simon (Southwark)Redmond, M.
Janner, Hon GrevilleRichardson, Ms Jo
John, BrynmorRippon, Rt Hon Geoffrey
Johnston, RussellRoberts, Allan (Bootle)
Jones, Barry (Alyn & Deeside)Roberts, Ernest (Hackney N)
Kaufman, Rt Hon GeraldRobertson, George
Kennedy, CharlesRobinson, G. (Coventry NW)
Kirkwood, ArchibaldRogers, Allan
Knox, DavidRoss, Ernest (Dundee W)
Lambie, DavidRoss, Wm. (Londonderry)
Lamond, JamesRowlands, Ted
Lewis, Ron (Carlisle)Sedgemore, Brian
Lewis, Terence (Worsley)Sheerman, Barry
Litherland, RobertShore, Rt Hon Peter
Lloyd, Tony (Stretford)Short, Ms Clare (Ladywood)
McCartney, HughShort, Mrs H.(W'hampt'n NE)
McDonald, Dr OonaghSilkin, Rt Hon J.
McGuire, MichaelSkinner, Dennis
McKay, Allen (Penistone)Smith, C.(Isl'ton S & F'buiy)
McKelvey, WilliamSmith, Rt Hon J. (M'kl'ds E)
McNamara, KevinSmyth, Rev W. M. (Belfast S)
McTaggart, RobertSoley, Clive
McWilliam, JohnSpearing, Nigel
Madden, MaxStrang, Gavin
Marek, Dr JohnStraw, Jack
Marshall, David (Shettleston)Thomas, Dafydd (Merioneth)
Martin, MichaelThomas, Dr R. (Carmarthen)
Mason, Rt Hon RoyThompson, J. (Wansbeck)
Maxton, JohnThorne, Stan (Preston)
Maynard, Miss JoanTinn, James
Meadowcroft, MichaelTorney, Tom
Meyer, Sir AnthonyWallace, James
Michie, WilliamWardell, Gareth (Gower)
Mikardo, IanWareing, Robert
Millan, Rt Hon BruceWeetch, Ken
Miller, Dr M. S. (E Kilbride)Welsh, Michael
Mitchell, Austin (G't Grimsby)White, James
Molyneaux, Rt Hon JamesWilliams, Rt Hon A.
Morris, Rt Hon J. (Aberavon)Winnick, David
Nellist, DavidWinterton, Nicholas
O'Neill, MartinWoodall, Alec
Owen, Rt Hon Dr DavidYoung, David (Bolton SE)
Park, George
Parry, RobertTellers for the Ayes:
Patchett, TerryMr. Patrick Cormack and Mr. Charles Morrison.
Pavitt, Laurie
Colvin, MichaelHunter, Andrew
Cope, JohnHurd, Rt Hon Douglas
Corrie, JohnIrving, Charles
Couchman, JamesJenkin, Rt Hon Patrick
Cranborne, ViscountJessel, Toby
Currie, Mrs EdwinaJohnson-Smith, Sir Geoffrey
Dicks, TerryJones, Gwilym (Cardiff N)
Dorrell, StephenJones, Robert (W Herts)
Douglas-Hamilton, Lord J.Joseph, Rt Hon Sir Keith
Dover, DenKershaw, Sir Anthony
du Cann, Rt Hon EdwardKing, Roger (B'ham N'field)
Dunn, RobertKing, Rt Hon Tom
Durant, TonyKnight, Gregory (Derby N)
Eggar, TimKnight, Mrs Jill (Edgbaston)
Emery, Sir PeterKnowles, Michael
Evennett, DavidLamont, Norman
Eyre, Sir ReginaldLang, Ian
Fallon, MichaelLatham, Michael
Farr, JohnLawler, Geoffrey
Favell, AnthonyLawrence, Ivan
Fenner, Mrs Peggy.Lawson, Rt Hon Nigel
Finsberg, Sir GeoffreyLennox-Boyd, Hon Mark
Fletcher, AlexanderLilley, Peter
Fookes, Miss JanetLloyd, Ian (Havant)
Forman, NigelLloyd, Peter, (Fareham)
Forsyth, Michael (Stirling)Lord, Michael
Fowler, Rt Hon NormanLyell, Nicholas
Fox, MarcusMcCrindle, Robert
Fraser, Peter (Angus East)McCurley, Mrs Anna
Freeman, RogerMacfarlane, Neil
Fry, PeterMacKay, Andrew (Berkshire)
Gale, RogerMacKay, John (Argyll & Bute)
Galley, RoyMaclean, David John
Gardiner, George (Reigate)McQuarrie, Albert
Gardner, Sir Edward (Fylde)Major, John
Garel-Jones, TristanMalins, Humfrey
Glyn, Dr AlanMalone, Gerald
Goodlad, AlastairMarland, Paul
Gorst, JohnMarlow, Antony
Gow, IanMather, Carol
Gower, Sir RaymondMaude, Hon Francis
Grant, Sir AnthonyMawhinney, Dr Brian
Greenway, HarryMaxwell-Hyslop, Robin
Gregory, ConalMayhew, Sir Patrick
Griffiths, E. (B'y St Edm'ds)Mellor, David
Griffiths, Peter (Portsm'th N)Merchant, Piers
Grist, IanMiller, Hal (B'grove)
Ground, PatrickMills, Iain (Meriden)
Grylls, MichaelMills, Sir Peter (West Devon)
Gummer, John SelwynMiscampbell, Norman
Hamilton, Neil (Tatton)Moate, Roger
Hampson, Dr KeithMonro, Sir Hector
Hanley, JeremyMontgomery, Fergus
Hannam, JohnMorrison, Hon P. (Chester)
Harvey, RobertMoynihan, Hon C.
Haselhurst, AlanMudd, David
Havers, Rt Hon Sir MichaelMurphy, Christopher
Hawkins, Sir Paul (SW N'folk)Neale, Gerrard
Hawksley, WarrenNelson, Anthony
Hayes, J.Neubert, Michael
Hayhoe, BarneyNewton, Tony
Hayward, RobertNicholls, Patrick
Heathcoat-Amory, DavidNorris, Steven
Heddle, JohnOnslow, Cranley
Henderson, BarryOppenheim, Philip
Hickmet, RichardOppenheim, Rt Hon Mrs S.
Higgins, Rt Hon Terence L.Osborn, Sir John
Hill, JamesOttaway, Richard
Hind, KennethPage, John (Harrow W)
Hirst, MichaelPage, Richard (Herts SW)
Holland, Sir Philip (Gedling)Parris, Matthew
Holt, RichardPatten, John (Oxford)
Hooson, TomPattie, Geoffrey
Hordern, PeterPawsey, James
Howard, MichaelPeacock, Mrs Elizabeth
Howarth, Gerald (Cannock)Percival, Rt Hon Sir Ian
Howell, Ralph (N Norfolk)Pink, R. Bonner
Hubbard-Miles, PeterPollock, Alexander
Hunt, David (Wirral)Porter, Barry
Hunt, John (Ravensbourne)Powell, William (Corby)
Powley, JohnTapsell, Peter
Price, Sir DavidTaylor, Teddy (S'end E)
Proctor, K. HarveyTemple-Morris, Peter
Rathbone, TimTerlezki, Stefan
Rees, Rt Hon Peter (Dover)Thomas, Rt Hon Peter
Renton, TimThompson, Donald (Calder V)
Rhodes James, RobertThompson, Patrick (N'ich N)
Ridley, Rt Hon NicholasThornton, Malcolm
Ridsdale, Sir JulianThurnham, Peter
Roberts, Wyn (Conwy)Townend, John (Bridlington)
Robinson, Mark (N'port W)Townsend, Cyril D. (B'heath)
Roe, Mrs MarionTracey, Richard
Rossi, Sir HughTrotter, Neville
Rost, PeterTwinn, Dr Ian
Rowe, Andrewvan Straubenzee, Sir W.
Rumbold, Mrs AngelaVaughan, Sir Gerard
Ryder, RichardWaddington, David
Sackville, Hon ThomasWakeham, Rt Hon John
St. John-Stevas, Rt Hon N.Waldegrave, Hon William
Sayeed, JonathanWalker, Bill (T'side N)
Shaw, Sir Michael (Scarb')Waller, Gary
Shelton, William (Streatham)Walters, Dennis
Shepherd, Colin (Hereford)Ward, John
Shepherd, Richard (Aldridge)Wardle, C. (Bexhill)
Silvester, FredWarren, Kenneth
Sims, RogerWatson, John
Skeet, T. H. H.Watts, John
Smith, Sir Dudley (Warwick)Wells, Bowen (Hertford)
Smith, Tim (Beaconsfield)Wells, John (Maidstone)
Soames, Hon NicholasWheeler, John
Spencer, DerekWhitfield, John
Spicer, Michael (S Worcs)Whitney, Raymond
Stanbrook, IvorWilkinson, John
Steen, AnthonyWolfson, Mark
Stern, MichaelWood, Timothy
Stevens, Lewis (Nuneaton)Woodcock, Michael
Stevens, Martin (Fulham)Yeo, Tim
Stewart, Allan (Eastwood)Young, Sir George (Acton)
Stewart, Andrew (Sherwood)Younger, Rt Hon George
Stewart, Ian (N Hertf'dshire)
Stokes, JohnTellers for the Noes:
Stradling Thomas, J.Mr. Robert Boscawen and Mr. Timothy Sainsbuiy.
Sumberg, David

Question accordingly negatived.