Repeal of Section Wi of Local Government Finance Act 1988

Part of Orders of the Day — Local Government Finance and Valuation Bill – in the House of Commons at 4:15 pm on 11 June 1991.

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Photo of Mr Michael Portillo Mr Michael Portillo , Enfield, Southgate 4:15, 11 June 1991

It is true that the local authority has to exercise restraint and that it does so under the criteria that are set by the Government. However, it is extraordinary to say that it is a distinction without a difference. Most local authorities will say that the painfulness of having to make changes once a cap has been applied, and especially if they did not know the rules regarding capping in advance, is out of all comparison with the position whereby they have a year in which to adjust their budget. They know in advance what the criteria will be so they can make sensible plans to fit in with them. I remind the hon. Member for Derbyshire, North-East (Mr. Barnes) that we are not capping any local authority below its standard spending assessment. This year, we are allowing those who came in at the SSAs a 9 per cent. increase on their previous budget. We did not regard any budget as absolutely excessive, as opposed to applying the criteria from year to year, unless it was 12·5 per cent. above the SSA.