Rating Reform

Oral Answers to Questions — Environment – in the House of Commons at 12:00 am on 16th March 1988.

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Photo of Graham Allen Graham Allen , Nottingham North 12:00 am, 16th March 1988

To ask the Secretary of State for the Environment what proposals he has to review the cost of collecting the poll tax in Nottingham, in the light of the estimates prepared by the Association of District Councils of the comparative costs as against rate collection.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Local Government)

As my right hon. Friend the Secretary of State announced on 8 March in his reply to the hon. Member for Copeland (Dr. Cunningham), he is commissioning a national study into the costs of preparation and collection of the community charge.

Photo of Graham Allen Graham Allen , Nottingham North

Is the Minister aware that the rates cost £1·4 million to collect in Nottingham, whereas, according to figures produced by the Conservative city of Nottingham authority, the new poll tax will cost £3·3 million to collect and that, whereas 68 people now collect the rates in Nottingham, it will take 158 staff to collect the poll tax? The Minister tells us that the poll tax will be simpler and cheaper. How can he justify double the number of staff and double the cost to the people of Nottingham and the rest of the country?

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Local Government)

The hon. Gentleman has it wrong. We never said that it would be cheaper to collect, but we think that it is a price worth paying for the advantages of the new system. I have seen the study produced by Nottingham city council, and I can tell the hon. Gentleman that Nottingham will be included in the study to which I referred.

Photo of Mr Martin Brandon-Bravo Mr Martin Brandon-Bravo , Nottingham South

May I put it to my hon. and learned Friend that the question asked by the hon. Member for Nottingham, North (Mr. Allen) has little to do with genuine concern about the cost of collecting the poll tax in our city of Nottingham? I suggest to my hon. and learned Friend that it has much more to do with Opposition Members' growing concern and their realisation that what they look upon as their captive audience — those who can be relied upon to campaign, lobby and vote for them at local level—will now have to pay something towards the measures for which they vote.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Local Government)

My hon. Friend is absolutely right. As the Labour co-ordinating committee recently put it: When the community charge is in force and the local council wants to carry out a programme of service expansion, local people will want to know that increased expenditure is well spent.

Photo of Mr Jeff Rooker Mr Jeff Rooker , Birmingham, Perry Barr

Notwithstanding the merits that the Minister might see in introducing the poll tax — for reasons that the Government may think are positive—does he agree that the public will not look well upon the conduct of public administration when they realise that they are paying a tax, each pound of which will cost twice as much to collect as each pound of the tax that it replaces? The public will see no sense in that and it will bring the rest of the conduct of public administration into disrepute.

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Local Government)

I do not accept a word of what the hon. Gentleman has said. I do not see how the effects to which he has referred apply in any sense to the collection of income tax from those who do not pay it on PAYE. As the hon. Gentleman well knows, that costs more as a proportion of the yield to collect than the community charge will.

Photo of Mr Hugh Dykes Mr Hugh Dykes , Harrow East

What did the Minister think about the letter on this matter from our hon. Friend the Member for Beckenham (Sir P. Goodhart) in The Times?

Photo of Michael Howard Michael Howard Minister of State (Department of Environment) (Local Government)

I could answer my hon. Friend's question at some length. However, the most important point about the letter that our hon. Friend wrote to the newspapers earlier this week was that he took the first-year figures, which include the effect of the safety net, and not the figures that would have applied had the community charge been fully in force this year, which would have been to the great benefit of his constituents.