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Orders of the Day — Local Government Finance

Part of the debate – in the House of Commons at 8:28 pm on 1st February 1995.

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Photo of Mr Michael Trend Mr Michael Trend , Windsor and Maidenhead 8:28 pm, 1st February 1995

We have heard much about certain cases today. I shall return to the essential elements of the debate as outlined by my right hon. Friend the Secretary of State at the beginning.

Like most hon. Members, I receive a substantial postbag every day crammed with letters demanding extra spending on all the items that we are discussing today. As all hon. Members should, I point out to my correspondents that the Government have no money of their own but only the ability to tax people. However, none of my correspondents is enthusiastic about paying higher taxes to provide greater resources to meet their massive demands. That is the background against which the Secretary of State's settlement must be viewed.

In the present circumstances, I believe that the settlement is reasonable. The economy is growing steadily in a sustainable way—although I know that many people are still waiting to feel the effects of the recovery. We have had a tough spending round. Many Conservative Members argued that public spending should he held down and we are not ashamed of that view now.

Local government has an almost insatiable appetite for funds which must be held in check, especially when the national economy demands it. The Government are concerned about the size of the public spending borrowing requirement. It is not the only national economic factor of central importance, but local government cannot be immune from the PSBR. The country as a whole must reduce its borrowing.

With underlying inflation at its lowest level in 27 years, I believe that this year's local authority finance settlement is fair. The Government believe that local authority revenue spending should increase by 2.2 per cent. in 1995–96, which is very close to the rate of inflation.

Against that background, it is up to local authorities to stay within the public sector pay guidelines suggested by the Government. They must make sensible budgeting decisions and look for further efficiency savings. Such good advice is not confined to local authorities; we must all expect to make savings. Government Departments are being asked to do it and private business understands the necessity of cutting costs while producing high-quality goods and services.

When considering local government finance, the really important question is: what do council taxpayers want? The answer is simple—they want good, effective services at the most reasonable cost possible. We have heard today from the Audit Commission's report, "Paying the Piper", which clearly highlights areas where local authorities can make further efficiency savings. The Audit Commission saw scope for councils to target their resources more efficiently and to increase staff productivity. It also pointed to the benefits of local pay management. That should be a model for all boroughs.

For some 15 years, I was an inhabitant and ratepayer of the London borough of Hackney. When it comes to Hackney, I know what I am talking about. I was part of a minority in Hackney: I was one of the few people who paid domestic rates. Since being elected as a Member of Parliament for the royal borough of Windsor and Maidenhead I have, very sensibly, taken up residence there.

However, the brief journey from east London to east Berkshire has been more than just a change of address; it has been an education in local government at its worst and at its best. It is highly relevant to the local government finance report because in both cases it is our money that is being spent.

When I saw Mr. McKinstry's article in The Spectator, it was like returning to Hackney. He said: The hallmarks for which Labour local authorities have become renowned"— are— accusations of racism, whining social workers, massive procedural delays, and rumours of corruption … Waste, bureaucracy and political correctness characterise too much of their work". Those are the words of a former Labour party supporter. Fortunately, that is not the case in Windsor and Maidenhead, where there is a long history of responsible management.

The royal borough of Windsor and Maidenhead is a tightly run ship. Therefore, it is perhaps no surprise that it has done reasonably well in this year's settlement. In the settlement just announced, the royal borough has been given a 2.83 per cent. increase on 1994–95 funding levels. I am grateful to my right hon. Friend the Secretary of State for what will be seen as a reasonable outcome.

The royal borough makes its case to the Department of the Environment with reasoned argument. Last year, the royal borough made a case to the Secretary of State about three main issues and I joined the council in pressing its case: first, it raised the matter of the all ages social index; secondly, we thought that the figures which were used in the standard spending assessment calculations understated the population; and, thirdly, we argued that it was unfair that there was no allowance for day tourism.

I am glad to say that some relief was given in respect of each of those three factors. First, the social index factor was split in two, which helped to a small degree; secondly, a more realistic population figure, based on the 1991 census, was used; and, thirdly, a new day tourist factor was included.

In this year's settlement, a further significant increase of slightly more than 1 per cent. has been applied in the population figure which is used to calculate SSA. That is good news for Windsor and Maidenhead. However, other changes made in the previous year continue to affect the royal borough.

The third factor recognises the impact that day tourism has upon towns which attract many day visitors and it applies to the town of Windsor in my constituency. In leading for the Opposition this afternoon, the hon. Member for Holborn and St. Pancras (Mr. Dobson) lumped Windsor with some very distinguished towns as though it were one of the very wealthy shire county towns. It is not.

If the hon. Gentleman had allowed me to intervene, I would have informed him that, not so long ago, Windsor had a Labour mayor. I am very distressed that the Labour party is no longer so well organised in Windsor, because I am keen to encourage a higher Labour vote there.

Windsor is not one of the super wealthy towns of the Thames valley, and Engels would have been familiar with many of its housing terraces. Its housing stock is not dissimilar to the old housing stock in Hackney. Many people who lived in Windsor when the houses were built in the last century worked at the castle and there is surprisingly little housing of a substantial size.

Windsor is a complex town. It is dominated by its magnificent castle, which was begun by William the Conqueror and is now known throughout the world. The castle gives Windsor a wealthy and cosmopolitan image, but that is not the reality.

Hon. Members may recall the disastrous fire which occurred in the castle a few years ago. I am pleased to report that considerable progress has been made in restoring the basic fabric of the affected part of the building and plans for the interior rebuilding and redesign were published last week. I am also pleased to say that the number of visitors to the town and to the castle has held up well. Some people feared that the fire would lead to such adverse publicity that tourists would stay away. Fortunately, that has not happened. That is a good thing, because many people in and around Windsor earn their living, one way or another, from the castle.

Away from the castle, down our main shopping street—