Local Government Finance(Wales)

Part of the debate – in the House of Commons at 10:39 pm on 29th January 1991.

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Photo of Mr Barry Jones Mr Barry Jones Shadow Secretary of State 10:39 pm, 29th January 1991

The right hon. Gentleman wriggles. His officials sent him a copy of the letter and they marked it. It was not good enough for the right hon. Gentleman to present the case for his charge change without referring to this letter. I have brought the letter to the attention of the House and he has been forced to concede that there are other methods—Councillor Puddle lists five. The right hon. Gentleman should, in all honour, have brought that letter to the attention of the House, and I must protest at his omission.

No amount of fine words will persuade the people of Wales to support the poll tax, because the Minister's fine words do not relate to the gathering intensity of the recession in Wales. It is a fact that our local authorities want to enhance their economic development policies. Their associations say that this settlement does not encourage them to do so. The increase in the business rate of about 10·9 per cent. is twice the projected rate of inflation, and that will add to the problems of business in Wales in the current recession.

May I remind the hon. Gentleman about the business rate and the recession? We have heard about the pending closure of the Deep Navigation pit, with 370 jobs. Mardy colliery has been axed; there are likely to be high-tech redundancies in Gwent at Mitel; Brymbo steelworks has closed; Laura Ashley factories are closing; Holyhead port will be hit; a G-Plan furniture factory in Wrexham will close; Glendale Furniture factory on Deeside is in the hands of the receiver; quarry jobs are to be lost in Gwynedd; and on Deeside, 200 Castle Cement jobs are to go.

The local authorities have consistently stated that the settlement is insufficient to enable them to deal with existing policies, population trends and central Government initiatives and legislation. A gap of about £50 million or more was identified by the local authorities—it remains. That is the view of the Welsh counties and the Welsh districts.

The settlement is very volatile. The extremes, in relation to the revenue support grant average, are astonishing. The high, for Meirionnydd—and good luck to it—is 32·9 per cent., while the low, for contiguous Montgomery, is minus 1·5 per cent. My district council, Alyn and Deeside, will receive only 0·4 per cent.—an extra £13,000—and the borough of Colwyn only 1·2 per cent., despite its pressing problems.

I do not think that the Secretary of State has fully considered the impact on council budgets, which will be considerable. The district councils are aghast at the implications of, for example, the litter code of practice: they say that the lack of specific provision for districts is more than worrying. The forecast costs are four to six times higher than the highest Government figure.

The Welsh district councils are also worried about the implications for housing investment. Compared with the 1987–90 Welsh district housing investment average, the current figure represents a real-terms reduction of no less than £75 million, or 25 per cent. There is a housing crisis in Wales and homelessness is an increasing and, in many instances, heartbreaking problem. It is becoming more and more difficult to find a house at an affordable rent, and many Welsh people find it almost impossible to afford a mortgage. Mortgages in Wales—a land, often, of low wages—are sky-high. Opposition Members think that the Government's policies have made Wales's housing problems worse, and the most severe problems are still in the valleys; although problems exist elsewhere, sometimes to a daunting extent.