Local Government Finance

Oral Answers to Questions — Scotland – in the House of Commons at 1:47 pm on 5 February 1997.

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Photo of Andrew Welsh Andrew Welsh , Angus East 1:47, 5 February 1997

To ask the Secretary of State for Scotland when he last met the Convention of Scottish Local Authorities to discuss local government finance. [12888]

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

I met COSLA on 17 January and I am looking forward to meeting it again on 4 July.

Photo of Andrew Welsh Andrew Welsh , Angus East

If only that could also be independence day for Scotland.

As local authorities face their greatest ever financial crisis, the Government claim that Scotland receives a per head of population subsidy for local services. Has the Secretary of State read the COSLA report that demolishes that Tory subsidy myth? Will he take the opportunity to refute line by line the COSLA report or cease the Tory anti-Scottish propaganda that he is pumping out?

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

The hon. Gentleman is confused. The Pieda report to which he refers is about jobs. He ought to know that we have commissioned an independent study by Coopers and Lybrand and Pieda which will set out where the extra money is going in local government. I think that he will be surprised when he sees the result.

Photo of Mr John Maxton Mr John Maxton , Glasgow Cathcart

Is the Secretary of State aware that we are told not only by elected councillors in Glasgow but by every official from the chief executive to the director of finance, right down across the whole board of the council's chief officials, that Glasgow is facing the greatest crisis in its existence? Why does he keep pretending that there is no crisis? Is he accusing them of telling lies? Whom should the people of Scotland and Glasgow believe—him or the officials?

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

If the hon. Gentleman does not believe me, he should believe the right hon. Member for Dunfermline, East (Mr. Brown), who I believe is the shadow Chancellor. He made it absolutely clear that a Labour Government would not give a cent more to the public expenditure plans that we have provided. If the hon. Gentleman feels that Glasgow is not getting its share of the pot, he should have a word with the Labour chairman of COSLA and leader of Edinburgh council, Mr. Keith Geddes, who has indicated that the distribution formula is fair and correct. [Interruption.] The hon. Gentleman should have a word with the hon. Member for Hamilton (Mr. Robertson), who appeared to say along with the right hon. Member for Sedgefield (Mr. Blair) that he thought that the formula for Glasgow was wrong, but is now saying that it is not.

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

The hon. Gentleman appeared to be saying that from a sedentary position. The Labour party should get its act together; men it might be in a position to give a coherent view on what it would like to happen.

The Government have set forward their proposals. We have been fair by Glasgow, including last year, when I gave it an extra £15 million to find time to make the necessary adjustments—time which has been squandered by the Labour administration.

Photo of Mrs Ray Michie Mrs Ray Michie , Argyll and Bute

The Secretary of State will be aware of the £8.5 million cuts which are facing Argyll and Bute council, because I wrote to him to ask him for a meeting on the matter, which he unfortunately declined. Is it not unrealistic to expect COSLA and the distribution committee to agree to take money from other councils so that Argyll and Bute can qualify for the special islands needs allowance? Does not the ultimate responsibility for funding and helping Argyll and Bute lie with him? We really must stop going around and around in circles and buck passing. Will the Secretary of State take that on board today?

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

The hon. Lady is normally very courteous. She has written asking for a meeting and my hon. Friend the Minister for Industry and Local Government has agreed to see her next Wednesday. She really does have to tell the whole story and not half the story. It is certainly true that Argyll and Bute would like to increase its expenditure substantially, although it has had extra cash. As she knows, I have some sympathy with her about the special islands needs allowance settlement. The position of COSLA is that Argyll is not justified in having it. Given the number of islands in Argyll, I agree with her that, on the face of it, that seems rather extraordinary. I am very happy for that to be considered in the distribution committee and agreed by COSLA.

We simply cannot have COSLA, which is dominated by the Labour party, saying that it speaks for the whole of local government and agreeing an arrangement with the Government, followed by the various constituent parts of local government coming along—[Interruption.]—and saying that they have not been treated properly and do not agree it. Then people such as the hon. Gentlemen speaking from a sedentary position blame the Government, who are genuinely trying to get a good deal for local government—a deal on which the shadow Chancellor has made it clear he could not improve.

Photo of Malcolm Chisholm Malcolm Chisholm , Edinburgh Leith

Why do the Government not tell the truth about local government, instead of giving us fiction and fiddles about grant levels and spending limits, and scaremongering rubbish about Labour's plans for the business rate? Why, for example, do they, unlike anybody who has studied the subject, keep pretending that £60 million will be saved next year, compared with this year, through local government reorganisation, and then keep adding that imaginary money to grant levels to come up with an imaginary increase for next year? Does the Secretary of State not understand that this is the worst local government settlement for more than 20 years—the final monument to 18 years of Tory economic failure? Does he not realise that nobody trusts or believes him, and that it is time for him to go?

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

If this years settlement is the worst in years—which it certainly is not—why can the hon. Gentleman not pledge an extra cent on top of it? If it is so bad, what has happened to the Labour party? What exactly would a Labour Government be for? If the hon. Gentleman says that ours is a poor settlement for Labour councils, why can he not add a single penny? The truth is that his masters in Islington know that it is a good deal for local government in Scotland.