Local Government Finance

Part of the debate – in the House of Commons at 3:31 pm on 30 November 1995.

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Photo of Frank Dobson Frank Dobson Shadow Secretary of State for Environment, Food and Rural Affairs, Shadow Minister (Culture, Media and Sport) 3:31, 30 November 1995

On the basis of the Government's figures, council taxes could rise by as much as this year's average increase of 5.2 per cent. That council tax increase, combined with higher charges for local services like school meals, meals on wheels and home helps, and the cost of service reductions, will cost an average household £108 next year.

The Government's figures also show that they expect council tax payers to cough up an extra £3.5 billion over the next three years, which is about equal to an extra tuppence on the standard rate of income tax. That is just another example of the Government furtively taking away with one hand the highly publicised cuts that they have been making with the other.

The Secretary of State and the Prime Minister today, like the Chancellor of the Exchequer on Tuesday, claimed that the Government will provide more money for education next year. That is simply not true. According to their own figures, councils will spend less on education next year than they are spending on it this year. An extra 86,000 children will be at school next year. It they are taken into account and councils fall into line with the Government's published spending plans, the amount spent per pupil next year in our schools, far from rising, will fall by £40 per pupil.

Let us compare the Government's world of fantasy finance with what is happening in the real world. In the real world, there are more schoolchildren; hard-working schoolteachers expect a pay increase next year; inflation drives up the price of books and other school equipment; and councils or schools will have to meet the extra costs of measures like installing seat belts in school coaches.

A landfill tax will be levied on councils, costing them £77 million next year. That is a straight transfer from council tax payers to the Treasury. This morning the Secretary of State said on the radio that councils could save more money by putting services out to tender. As he well knew when he said it, councils are already obliged by law to put their services out to tender and, if a contract does not go to the Tories' friends in the private sector, it can be only because a council's own work force put in a lower and better bid. He also suggested that councils can increase charges to help keep up their current level of spending. Which charges does he want to see increased? Does he want parents to have to pay more for school dinners or pensioners to pay more for meals on wheels or home helps?

This mean-minded settlement will increase council taxes, push up charges for vital local services and cut those services for local people. It means that next year, like this year, the Government will force local people to pay more and get less.