Local Government Finance

Oral Answers to Questions — Wales – in the House of Commons at 12:00 am on 29th April 1991.

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Mr. Alan W. Williams:

To ask the Secretary of State for Wales whether he has decided what proportion of the new local government charge in Wales will be levied on property tax; and what proportion will be poll tax.

Photo of Mr David Hunt Mr David Hunt , Wirral West

The question does not arise, because I have already announced that I propose to abolish the community charge in Wales.

Mr. Williams:

In his statement last week on the new council tax, the Secretary of State said that there will be transitional relief for people facing excessive increases under the new structure. Will the beneficiaries be the people who live in large houses, who benefited so unfairly from the poll tax? Does it make sense to continue to subsidise the better-off? Does the Minister accept that the poll tax punished the poor, whereas under the new structure banding and transitional relief will protect the rich?

Photo of Mr David Hunt Mr David Hunt , Wirral West

No. Transitional relief should be available under any new system, and we have made that absolutely clear. People in Wales would lose only if we returned to the old rating system. The hon. Gentleman will have seen the figures that I have published, which show that in 1989–90—when Welsh people last paid rates—people paid on average £327. For this year, it would have had to increase to £385. In the coming year, the average bill per household for the new council tax will be £152. That is much fairer and better for the people of Wales.

Photo of Mr Ian Bruce Mr Ian Bruce , South Dorset

Will my hon. Friend assure the House that the figures are available in the Vote Office, as I have experienced some difficulty in obtaining them? English Members may be upset to see that people on the highest rate in England are paying £668, but those in Wales are paying only £272. The bottom rate in Wales is £109, but is £267 in England. Is there any justification for Welsh people, who have lower costs of living, being subsidised by English taxpayers?

Photo of Mr David Hunt Mr David Hunt , Wirral West

I understand that there has been rather a run on these exemplifications. According to my hon. Friend, the Vote Office has run out of copies, but as soon as I leave the Chamber, I shall ensure that further copies are made available. Under the Government, and only under the Government, Wales has had the best possible deal. Under a Labour Government, not only would we return to the unfair old rating system, with 1973 values and a complete revaluation, but average bills would leap up because we would be returning to the old Labour way of funding local services.

Photo of Mr Richard Livsey Mr Richard Livsey , Brecon and Radnor

Will the Secretary of State confirm the view expressed last week by the Secretary of State for the Environment that we shall be stuck with the poll tax for the next three years because the council tax in Wales cannot be introduced until the financial year 1994–95

Photo of Mr David Hunt Mr David Hunt , Wirral West

That is not true. I had a positive and constructive meeting with the Assembly of Welsh County Councils and the Association of Welsh Districts. Consultation is well on course to introduce the council tax in Wales the year after next.

Photo of Mr Gwilym Jones Mr Gwilym Jones , Cardiff North

Will my right hon. Friend confirm that we have achieved the Wandsworth effect in parts of Wales only because of the intervention of my right hon. Friend and of the Chancellor of the Exchequer? No one in Wales will be worse off this year under the new council tax, compared with the community charges that were to be imposed by Liberal and Labour councils in Wales.

Photo of Mr David Hunt Mr David Hunt , Wirral West

That is true. The message on Thursday is simple for the people of Wales. If they vote Conservative, their councils will cost them less and they will get better services.

Photo of Paul Murphy Paul Murphy Shadow Spokesperson (Wales)

As the Welsh people will have to put up with the poll tax for at least another two or three years, and as the Conservative party is squabbling about the nature of the new tax and its banding arrangements, does not the right hon. Gentleman believe that, despite being surrounded by English colleagues, he should accept a uniquely Welsh solution to the poll tax by listening to the people of Wales, who overwhelmingly believe in a fair rates system and immediate abolition of the poll tax?

Photo of Mr David Hunt Mr David Hunt , Wirral West

I said that we are used to spectacular own goals by the Labour party, but we have just heard the best. The hon. Gentleman admitted that there is no prospect of a Labour Government when he said that the poll tax will remain in Wales for three years. In any event, that is untrue. If the hon. Gentleman had listened to the answer that I gave a few moments ago, he would know that we are well on course to introduce the new council tax the year after next.

If people read "Fair Rates", they will not only remember that the right hon. Member for Islwyn (Mr. Kinnock) once called rates the most unjust form of all taxes but see that the proposed rates system would involve going straight back to the old registers, which were introduced in 1973, and then having a complete revaluation. That would be bad news for the whole of Wales.