Orders of the Day — Local Government Finance (Wales)

Part of the debate – in the House of Commons at 7:26 pm on 4 February 1997.

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Photo of Mr Ron Davies Mr Ron Davies , Caerphilly 7:26, 4 February 1997

My hon. Friend is right. He represents Merthyr Tydfil and Rhymney, which includes part of my local authority area of Caerphilly. That local authority faces horrendous consequences as a result of this settlement. It is grappling with budget cuts of £8 million, as are other local authorities. The local authority of my hon. Friend the Member for Blaenau Gwent (Mr. Smith) is one of the smallest, but it faces cuts of £6 million or £7 million in its annual budget.

The consequences must rest on the Government's shoulders. There will be real and severe cuts across the whole range of local government services, especially services that are trying to meet the cost of economic and social failure. The settlement will affect local authorities that are trying to invest in and improve their communities to generate wealth and job opportunities, and to build for the future. The Government are so short-sighted that they do not understand the role that local authorities play, and they will not work in partnership with them. It is all part of the Government's strategy to make council tax payers pay more. The 1p cut in the standard rate of income tax in last year's Budget will be more than cancelled out by council tax increases resulting directly from this settlement.

In addition, the capital settlement has been cut by £66 million. That money is needed for investment.