Local Government Finance (Wales)

Part of the debate – in the House of Commons at 4:24 pm on 20th July 1989.

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Photo of Mr Peter Walker Mr Peter Walker , Worcester 4:24 pm, 20th July 1989

I will speak very slowly, as the next passage is of great importance. It concerns the arrangements we have made to assist those on low incomes. Those on the lowest incomes in Wales who qualify for income support will be better off with the community charge than they were under the old rating system, because income support payments will include an amount—which will be the same throughout Great Britain—to help pay the community charge. Owing to the low levels of community charges in Wales, people would actually be better off than they would if they received a 100 per cent. rebate.

A couple on income support paying the community charge for standard spending of £175 each would get the maximum rebate of 80 per cent. leaving them with a combined liability of £70. To help them meet this their income support will have been uprated by an annual amount equivalent to £119·60, leaving them £49·60 in pocket. We estimate that over 300,000 community charge payers in Wales—about 14 per cent.—will qualify for the maximum assistance.

I will be bringing forward more detailed arrangements for all aspects of the settlement in the autumn, following discussions with the local authority associations. But the proposals I have announced today offer charge payers in Wales the prospect of community charges averaging £175 provided that their councils take responsible spending decisions. They offer authorities—particularly those who seek and achieve the efficiency gains which are available—a fair and realistic framework within which to set their budgets for 1990–91. If they budget sensibly, the rewards are self-evident.