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Local Government Finance (Scotland)

– in the House of Commons at 3:40 pm on 4th March 1997.

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Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside 3:40 pm, 4th March 1997

I beg to move, That the Local Government Finance (Scotland) Order 1997, dated 12th February 1997. which was laid before this House on 13th February, be approved.

Photo of Miss Betty Boothroyd Miss Betty Boothroyd Speaker of the House of Commons

I understand that with this, it will be convenient to discuss the following motions: That the Revenue Support Grant (Scotland) Order 1997, dated 12th February 1997, which was laid before this House on 13th February, be approved.That the Special Grant Report (Scotland) on Supplementary Mismatch Scheme Grant for 1997–98 (HC 272), which was laid before this House on 13th February. be approved.That the Special Grant Report (Scotland) on Grant in aid of building works at Dunblane Primary School and Grant in aid of Local Authority revenue costs resulting from the Dunblane tragedy (HC 273), which was laid before this House on 13th February, be approved.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

This afternoon, the House has its annual opportunity to debate the Government's financial settlement for Scottish local authorities. It is an important day—a day when I would have expected the Opposition Benches to be filled. I note, however, that they are singularly empty at present. I trust that greater interest will be shown as time goes on.

I realise the quandary that the Opposition are in this afternoon, because a poll in The Herald this morning shows a 6 per cent. drop in support in Scotland for the Labour party; and the hon. Member for Hamilton (Mr. Robertson) has at last realised that cutting administration and bureaucracy is an area that should be considered. He proposes to do that in the health service, but what has he done in the months and years past, in local government? Absolutely nothing. Yet his party controls local government in Scotland. The Labour party has said that there is no more money for local government, and Labour Members are here to debate that issue with us. We have said that there is plenty of funding for local government.

The purpose of the debate is to approve a package of legislation that deals with Scottish local authority funding. I propose therefore to begin by briefly introducing each element of the package.

Photo of Andrew Welsh Andrew Welsh , Angus East

I seek a straightforward explanation. Why is the Minister withdrawing £350 million from Scottish local authorities, and threatening some 17,000 jobs, which will increase council taxes and council rents? As Scotland will subsidise the United Kingdom by some £12.5 billion over the next five years, why is he doing that?

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

I should have thought that the hon. Gentleman would come up with something better than the old story of surpluses. Unfortunately, he is unable to understand the budget deficit between Scotland and the rest of the United Kingdom.

The Local Government Finance (Scotland) Order 1997 is accompanied by a report that sets out in detail the way in which the figures have been arrived at. It has been subject to extensive consultation with the Convention of Scottish Local Authorities. I shall be happy to expand on any points of detail that hon. Members wish to raise.

The next order before us is the Revenue Support Grant (Scotland) Order 1997, which is also accompanied by an explanatory report. The figures have again been calculated on a basis agreed with COSLA. Overall, the order provides for the payment to local government of a net sum of £2.73 million.

The Special Grant Report (Scotland) on Supplementary Mismatch Scheme Grant for 1997–98 is the second such report. The proposed grant payments for 1997–98 ensure that the 10 councils will be protected for 50 per cent. of their mismatch. The report provides for the payment of special grant totalling £14.19 million next year, £6.97 million of which will go to Glasgow city council.

Lastly, hon. Members will see that we are also seeking their approval for the Special Grant Report (Scotland) on grant in aid of building works at Dunblane primary school and grant in aid of local authority revenue costs resulting from the Dunblane tragedy. We estimate that the first of those grants will amount to £2.091 million, and the second to £2.073 million. The report sets out how we have determined the amounts of grant that will be paid and their purpose. It is the product of close liaison with the council since the horrific events of last March. The report requires the formal approval of the House, which I hope it will obtain in a way that spares the community undue further attention.

So much for the detail of our proposals. I expect that, as in previous years, the overall local government finance settlement rather than the specifics of the orders and reports is likely to dominate the debate. We shall doubtless hear the usual, totally predictable complaints. Opposition Members, COSLA and virtually every local authority constantly complain that Scottish local government is underfunded, and that next year's settlement will require councils to cut expenditure.

It bears repeating as often as those claims are made that nothing could be further from the truth. Contrary to all the talk of cuts next year, next year's settlement allows every single council in Scotland to increase expenditure compared with the current year. It also bears repeating until the message has hit home that the overall settlement provides for an increase of more than £140 million, or 2.2 per cent., in local government expenditure. That is before any account is taken of the scope for efficiency savings.

At the same time, the level of Government support for that expenditure has been increased by more than £60 million, which is £46 million more than local government expected to receive, when it considered its planned expenditure for next year as outlined last year.

Photo of Michael Martin Michael Martin Chair, Administration Committee

The Minister has given local authorities, such as Glasgow city council, new burdens of additional expenditure for the police and for community care.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

The hon. Gentleman came to see me last Friday, with representatives of Glasgow city council. It was an interesting meeting, because Glasgow city council receives £21 million of mismatch funding, partly through the self-finance mismatch funding scheme and partly from the almost £7 million that it receives in supplementary top-up, which my right hon. Friend the Secretary of State introduced last year. Glasgow said that in this year's expenditure, it would be able to pay off a deficit of£9 million. That means that Glasgow city council has£10 million extra expenditure that it can incur while staying within its capping limit, plus £9 million that it seems to have accumulated, so that it can pay off a deficit this year. Therefore, the council has the possibility to increase its budget by some £19 million. Of course, that does not stop the council, because it says that it still has to make further cuts of some £80 million. That shows that it is looking to increase its budget by some £99 million. At a time when inflation is running at between 2 per cent. and 3 per cent., that budget increase would be in excess of 10 per cent. That is unreasonable.

Glasgow has had a fair deal. When Councillor Gould came to see my right hon. Friend the Secretary of State last year and pleaded for some extra help to buy time to get his expenditure into line with revenue, Councillor Gould knew perfectly well what was going to happen to the funding of Glasgow city council this year. I give him credit for the fact that he seems to have been able to pay off a deficit this year. It appears that he seems, if what he says is right, to have managed to get his expenditure into line with budget, so I fail to understand why he is seeking to increase his budget now by more than 10 per cent.

Photo of Mrs Maria Fyfe Mrs Maria Fyfe , Glasgow Maryhill

The Minister will recall the detailed discussion that Glasgow Members and city council representatives had with him on Friday. I am sure that, if he recalls that discussion, he will remember that, although there was a £9 million surplus this year, that still leaves the council with an £80 million deficit and having to sack up to 2,000 workers and cut services accordingly. Does he still think that Glasgow is trying to spend more money? It is struggling to avoid spending far less and wrecking services.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

The hon. Lady has not been listening to what I have said about Glasgow city council. My point is this. It appears that next year it is seeking to spend almost £100 million more than this year, but when I mentioned at the meeting some of the information that I had received as a result of asking Councillor Gould about his councillors' travel arrangements in the past year, I noticed that certain hon. Members rose very quickly to their feet.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

My right hon. Friend mentions the word "rose". That could lead me to give some of the details. Hon. Members heard me say that, when I looked through the analysis of councillors' visits to conferences and trips abroad, I found that two councillors went to Rostov-on-Don for the Rostov city days event—what that has to do with Glasgow I fail to understand—

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

In a minute. I did not mention the hon. Gentleman, but I was referring to him, and I shall give way in just a minute, because he may be able to justify those trips, at a time when Glasgow city council is advocating significant cuts—his words, not mine—in service delivery. There were two trips to the Rostov city days event, one to St. Petersburg for a symposium on cultural policy in Europe and another to an international rose exhibition in Rome. Lastly, I fail to understand why a councillor from Glasgow city council went all the way to Hong Kong for a meeting of the International Badminton Federation, when the council is talking about cutting services.

Photo of Michael Martin Michael Martin Chair, Administration Committee

The Minister was referring to me and to the comments that I made. He should have been fair, because I invited him to have a debate on the Floor of the House about trips abroad, so that we could talk about some of the trips that Conservative Members go on, which are so strange that the Privileges Committee has had to examine them. I speak as a Member who has not been abroad in this Parliament. I say to the Minister: hold a debate, when we can talk about everyone's trips abroad. It is a scandal that the Privileges Committee has had to examine hon. Members who have brought shame on the House.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

I understand the hon. Gentleman trying to divert the debate from what I was talking about, which is what is going on in Glasgow city council, but it might interest him to know that I have made two trips abroad in the past 18 months. From one, I brought back 4,300 jobs after inward investment by Chunghwa Picture Tubes and. from the other, 500 jobs were created at the Lexmark company in Rosyth. I believe in spending money wisely, in the interests of my responsibilities. I find it difficult to understand the expenditure to which I referred, at a time when Glasgow city council is asking its electorate for a 22 per cent. increase in council tax and talking about cutting services.

If the hon. Member for Glasgow, Springburn (Mr. Martin) does not like to hear about foreign trips, I refer him to the fact that Glasgow city council proposes to spend £500,000 celebrating the centenary of the Scottish Trades Union Congress. How does it plan to do it? It proposes to be environmentally friendly and pour red dye into the Clyde. What on earth that will do for the good citizens of Glasgow, I fail to understand. In addition, it has spent £810,000 on 28 cars for the council and about £500,000 on legal costs, trying to bust the conditions attached to the Burrell bequest. That is quite inexplicable from a council that is seeking to cut services to its council tax payers, but it is only to be expected from the prospective candidates for the tax-raising Parliament that Labour and the Liberal Democrats wish to set up after the election, if, God forbid, they ever come to power.

Photo of John McAllion John McAllion , Dundee East

As the Minister is comparing trips abroad with cuts in public spending at home, how does he justify the Minister responsible for housing in Scotland going to Atlanta to watch the Olympic games, after imposing one of the worst ever housing settlements on Scotland and making more vicious cuts in housing expenditure? What connection is there between the Olympic games and housing in Scotland?

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

The hon. Gentleman failed to remind the House that my hon. Friend is also the Minister responsible for sport in Scotland, and one of his functions is to ensure good and successful sporting activity. The meetings that he held in Atlanta contributed to his current thinking about the future of sport in Scotland. I should have hoped that the hon. Gentleman, who I thought was a football fanatic, would appreciate the fact that my hon. Friend was taking a healthy interest in his subject.

What badminton in Hong Kong or a rose exhibition in Rome had to do with Glasgow city council, however, I fail to understand.

Photo of Mr Hector Monro Mr Hector Monro , Dumfries

Does my hon. Friend agree that had the Minister responsible for sport in Scotland not gone to Atlanta to support Scottish competitors in the Olympic games, all hell would have broken loose among the Opposition? We like our Ministers to represent Scotland at major sporting events, as I did at the Commonwealth games.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

My right hon. Friend is absolutely right. As he is a former Sports Minister and was once a successful rugby player, he knows only too well the need for the best possible information about sport.

I do not wish to be diverted too far on the issue of sport. Let me return to Glasgow city council.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

If it is on Glasgow city council, I shall give way to the hon. Gentleman.

Photo of Mr Tony Worthington Mr Tony Worthington , Clydebank and Milngavie

I really must appeal to the Minister to treat the matter with great seriousness. We have lost hundreds of jobs throughout Scotland, services have been cut and there have been massive increases in council tax. If we have a successful economy in Scotland, why can we not afford the same services this year as last year?

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

The hon. Gentleman talks about treating the matter seriously. I consider it to be exceedingly serious, and that is why I have had meetings with councils and with right hon. and hon. Members. 1 am disappointed by the fact that it was apparent at those meetings that hon. Members had not understood the councils' intentions. Perhaps the hon. Gentleman should know that if we did not have capping, as is Labour policy, Glasgow city council would not be asking for a 22 per cent. increase in council tax. The council would go to council tax payers and ask for a 62 per cent. increase. That is a disgraceful way in which to run a council—it is attempting to increase expenditure by more than 11 per cent.

Photo of Mr Jimmy Wray Mr Jimmy Wray , Glasgow Provan

Does the Minister really understand local government finance? It is obvious that he does not understand the city of Glasgow, which has been eroded and become riddled by years of Conservative government, crime, drugs and homelessness. Medical reports such as the Black report show that the infant mortality rate in Glasgow is the worst in Europe. That is the Government's record. The Minister does not understand finance. In his letter to the provost, he wrote about "aggregate finance", "specific needs" and "needs and resources elements". He aggregated those elements, and it cost Glasgow millions of pounds.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

I am sorry that the hon. Gentleman takes that view, because he showed a singular lack of knowledge of local government finance when leading the delegation that met me last Friday. The facts of life are that Glasgow city council may well have the problems that he mentioned. However, he fails to recognise the fact—although it is staring him in the face—that the Labour party has been in control of Glasgow city council and has created those conditions, because it cannot prioritise spending in the best interests of council tax payers.

Several hon. Members:

rose

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

Conservative Members are responsible, and they attempt to ensure that taxpayers' hard-earned funds are spent wisely, to achieve cost-effective service delivery within local government.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

I give way to the hon. Member for Linlithgow (Mr. Dalyell).

Photo of Miss Betty Boothroyd Miss Betty Boothroyd Speaker of the House of Commons

Order. Too many hon. Members are attempting to intervene at the same time. Only one hon. Member should be on his feet at a time, and that is the Minister, unless he gives way.

Photo of Mr Tam Dalyell Mr Tam Dalyell , Linlithgow

If I have heard the Minister wrongly, forgive me. I thought that, in his outburst, he referred to busting the conditions of the Burrell bequest. Would this be an appropriate moment to ask what the Government's policy is on the very difficult matter of the Burrell bequest? Are the Government really in favour of "busting" its conditions?

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

As I understood the position—although I shall attempt to clarify it—the conditions attached to the Burrell bequest are a responsibility of the trustees, not of the Government. However, I am concerned that Glasgow city council is attempting to break the conditions of the Burrell bequest and, in doing so, incurring expenditure of up to £500,000 of council tax payers' funds. If that is the case, I question whether that is funding well spent, at a time when Glasgow is—

Dr. Godmans:

rose

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

I should like to move on, but I am happy to see such healthy interest on the Opposition Benches. I shall give way.

Photo of Mr John Maxton Mr John Maxton , Glasgow Cathcart

I wonder where the Minister gets the figure of £500,000, whereas the council says that, at the maximum, it is £90,000? That is the sum. Why is the Minister trying to tell us that it is £500,000 when it is not?

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

I very carefully said "up to £500,000", and I hope that the figure—if anything—would be significantly less. The councillors who came to see me with the hon. Member for Glasgow, Provan (Mr. Wray) clearly should be attempting to spend council tax payers' funds and central taxation in a wise manner, so that their council tax payers have good delivery of service. At that meeting, however, when we analysed the request, they made it clear that what they effectively wanted was £50 million more, to be given to Glasgow city council. They already have £21 million more, through the two mismatch schemes.

Would hon. Members representing areas covered by the other new local authorities in the former Strathclyde region—East Ayrshire, East Dunbartonshire, East Renfrewshire, North Ayrshire, North Lanarkshire, Renfrewshire, South Ayrshire and South Lanarkshire—be happy for an extra £50 million to be taken from their funding, to go to Glasgow? That is what the Glasgow councillors were arguing to me. They said that the distribution of funds did not favour Glasgow adequately and that more money should come from those areas outside Glasgow.

Photo of Dr Norman Godman Dr Norman Godman , Greenock and Port Glasgow

Clause 4 of the Merchant Shipping and Maritime Security Bill places additional responsibilities on fire authorities to deal with emergencies at sea. What discussions have there been between the Scottish Office and the Department of Transport about that additional burden to be placed on our fire authorities? Was there any discussion about the funding of training of firemen for the extra duties and the provision of extra equipment?

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

The grant-aided expenditure on fire has been increased considerably. There are always discussions with the authorities to ensure adequate funding.

I allowed myself to be slightly diverted by the detail of Glasgow. I wanted to conclude by saying that local government has been treated favourably in last year's public expenditure survey.

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

I was waiting for the Minister to move on from talking about Glasgow. How does he account for the fact that Argyll and Bute council is facing £8.5 million of cuts as it tries to meet the commitments inherited from Strathclyde regional council? Some £3.5 million of those cuts are in education. We are facing the closure of three more schools, two of which are on an island. Why can the Minister not help Argyll and Bute?

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

I am able to do something for Argyll and Bute. The hon. Lady will be aware that there has been disagreement among the local authorities about the disaggregation of the former Strathclyde budget. The Scottish Office has always said that it was for the local authorities to decide about that distribution. After a lot of effort in trying to persuade West Dunbartonshire council to accept an independent arbiter—a point raised by the hon. Member for Dumbarton (Mr. McFall) when he came with a council delegation to see me—I am delighted to say that the arbiter has worked incredibly quickly and has come up with a figure, which I believe has been agreed with Argyll and Bute and West Dunbartonshire. Argyll and Bute should be able to spend more than £500,000 extra this year within its capping limit. My right hon. Friend the Secretary of State will announce that officially to the council later this afternoon.

At the recent meeting of the Scottish Grand Committee in Montrose, my right hon. Friend challenged any Opposition Member who thought the settlement inadequate to say which Scottish Office programmes they would cut to give more to local government. Predictably, Labour Members ran a mile to avoid answering. They could not answer, because the right hon. Member for Dunfermline, East (Mr. Brown) has decreed that there will be no increase in public expenditure, and therefore no extra expenditure in Scotland on local government.

I understand that the hon. Member for Hamilton, who will be opening for the Opposition, is now considering how to redistribute funding. I should delighted if he is really talking about getting his Labour councils to start looking at making themselves more cost-effective, and spreading local authority expenditure away from the centre, the bureaucracy and administration, and out to the front-line delivery of service, because that is what we believe in. We believe in cost-effective delivery of service.

Perhaps the Labour party finds it easier to act simply as a postbox for the misleading claims that local authorities are being compelled to cut services—without examining what is really going on. Labour Members have doubtless been briefed by councils and COSLA on the scale of cuts—as they call them—that they claim will have to be made. I should, however, be pleasantly surprised to find that Labour Members had examined such claims at all carefully. I have examined the claims very carefully indeed. As I said, I have also had the opportunity to discuss the claims face to face with a number of council representatives, including those from Glasgow and Argyll and Bute, which revealed an absolutely fascinating fact.

Councils are claiming that they need to increase their spending by about £500 million this year, just to stand still. That is half a billion pounds on top of any efficiency savings that they can make, or an increase of 8 per cent. on current spending, at a time when inflation is only about a third of that. If capping were not in place, that £500 million would mean an increase in the council tax in Scotland of no less than 42 per cent.—by mostly Labour-controlled councils. Yet the Labour party believes that if it ever came to office, it would not put up taxes. The Labour party is the party of spend and tax, as we are seeing in local government in Scotland. Its assertion is an extraordinary one, which I cannot believe any sensible person would take at face value.

Photo of Mrs Maria Fyfe Mrs Maria Fyfe , Glasgow Maryhill

As the Minister's words a moment ago showed that he disbelieved the claims made by councils, is he telling us that he is predicting that there will be no redundancies in Glasgow in the provision of essential services?

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

Glasgow city council must face up to facts; that is the long and the short of it. The hon. Lady does not of course understand. I assume that exactly the same distribution of central funding, through a formula agreed jointly in the distribution committee between COSLA and the Scottish Office, would be in operation should the Labour party ever come to power.

I have sought to find out whether COSLA wants to change the method of distribution. My right hon. Friend the Secretary of State has written to the president of COSLA, asking whether he agrees with the desire of the hon. Member for Hamilton to have an independent look at the distribution of funds from the centre. The hon. Gentleman is in total opposition to COSLA, because COSLA' s president said that he was more than happy with the distribution committee.

My right hon. Friend the Secretary of State went a stage further and suggested that perhaps it was time to take the responsibility for the distribution of funds away from the distribution committee; perhaps a totally independent body should consider distribution, so that people in Glasgow and hon. Members who represent Glasgow could feel that the process was independent. Yet COSLA, which is largely made up of the Labour party in Scotland, says that it is happy with the distribution. There is the most incredible split in the Scottish Labour party, which is only too apparent in local government finance.

Photo of Mr Jimmy Wray Mr Jimmy Wray , Glasgow Provan

Does the Minister agree that, last year, Glasgow council made cuts of £68 million and increased the council tax by 25 per cent.? Does he further agree that, this year, in order to meet the Minister's capping level, it will have to increase its council tax by another 25 per cent., sack 2,000 employees and cut some services by 10 per cent. and some smaller services by 15 per cent. and 20 per cent?

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

The hon. Gentleman has forgotten what happened last year, when Councillor Gould struck a deal with my right hon. Friend the Secretary of State. The deal was that my right hon. Friend would guarantee to give extra funding to Glasgow and other so-called mismatch losers if they agreed to bring expenditure into line with revenue. It is up to the councils how they organise their funds. Last year, Glasgow's budget was some £843 million, and the council could prioritise its spending within that budget, to ensure good service delivery.

Last year, the councillors talked about cuts, but again they increased expenditure over the year before. The hon. Member for Provan fails to recognise, from what the councillors told me on Friday, that they are able to increase expenditure on service delivery by some £19 million this year. The hon. Gentleman shakes his head, but officials were concerned by the questions that I asked at the meeting. The councillors told me that they would not be in deficit at the end of the year. Indeed, they said that they would be in surplus, so that they could pay off £9 million of budget deficit inherited from the former Strathclyde council. That means that they spent some £9 million less on service delivery than they expected, so they probably have a flexibility of £9 million within their capping limit, which can be added to the £10 million increase, giving some £19 million. The long and the short of it is that Glasgow has had a good settlement. Glasgow must recognise that for years, under a Labour administration, it has prioritised its expenditure out of line with the people's needs and has not ensured good service delivery. It is time that Labour Members recognised that.

I have yet to have a satisfactory explanation from councils or from the Labour party, of why councils should need the enormous increase that they want. By the councils' admission, the increase would not be used to enhance or improve the services that they provide—it would be used to stay where they are. That is hardly an attractive sales pitch. I can conclude only that they have a spending wish list and that talk of cuts is simply deplorable scaremongering.

I have heard tales of councils varying their claims of expected council tax increases. Edinburgh made the most ridiculous claims not many weeks ago, but it is now talking of a council tax increase of some 3 per cent. The stories are scaremongering and nothing more. Certain councils have created unnecessary alarm among the more vulnerable members of the population, and that is sad. I condemn that, because it does no service to the cause of local government.

Photo of Mr Eric Clarke Mr Eric Clarke , Midlothian

Does the Minister remember that I brought a delegation of Midlothian councillors to meet him? He disagreed with our claims about the way in which the money was redistributed by COSLA, but the reduction of £3 million in grant aid to Midlothian is a fact and is equivalent to a 16 per cent. increase in council tax. Nobody challenged our figures at the meeting—merely the way in which they were calculated.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

The hon. Gentleman brought a delegation to see me, and I welcomed our discussion. I pointed out to the Midlothian councillors that they were permitted to increase their expenditure, within the capping limit, by some 3.17 per cent. this year. That takes into account the public expenditure policy on pay and salaries—that awards should be funded from efficiency improvements—so councillors have 3.17 per cent. more to spend on services, and there is absolutely no reason for cuts. The hon. Gentleman is a Whip, so perhaps he should ask his colleagues on the Front Bench what funding they would give local government if ever they came to power.

Throughout all the discussions of the past weeks, Opposition Members have complained about cuts and insufficient funding for local government, as they have done year on year on year, yet this year there has been a strange silence from the Opposition Front Bench. That silence was leaked by the hon. Member for Edinburgh, Leith (Mr. Chisholm) when he said to people at a party meeting in Dundee that they might not believe it, but Labour was going into the next general election campaign advocating no increase in expenditure.

That may be a major problem for the Labour party, but I cannot help that. We have given increased funding to local government, which occupies about 37 per cent. of the Scottish Office bloc. Once again, I challenge the hon. Member for Hamilton to say what he would give to local government, and where he would take it from, if he were on Government Benches.

Local government benefits from reasoned, realistic, informed debate. I hope that we shall have that this afternoon; from the interventions that I have taken so far, I find that difficult to believe, but I live in hope. To shed more light on the matter, my right hon. Friend the Secretary of State and I commissioned the local authority current expenditure study, which was published last month. Copies of the report were sent to all Scottish Members. Hon. Members have now had time to study what my right hon. Friend rightly described as a major and important piece of work.

The study was carried out entirely independently of Government, by Coopers and Lybrand and Pieda. After going to great lengths to ensure that it was comparing like with like, the report concluded that spending levels across a wide range of services were higher—in some cases, very much so—than in England or Wales.

The report completely destroys the myth that Scottish local government is underfunded. One of its many interesting points is that the much higher spending levels have been consistent over the past 10 years, despite all the claims by Opposition Members that the Government have starved Scottish local government of resources.

Critically, the consultants question the extent to which issues that are often cited as "explaining" the much higher levels of expenditure in Scotland, such as sparsity, deprivation and unemployment, are genuinely significant. Opposition Members may want to think seriously about that before launching into this debate.

My right hon. Friend the Secretary of State made it clear that the Government are committed to a second-stage study, the main objective of which would be to get behind the figures that have been published and explore further the reasons for higher spending by Scottish councils, and to consider the relative efficiency of councils and the quality of service that they deliver.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

The hon. Gentleman says that it is ridiculous, but it shows the wide gulf—

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

The Minister has been speaking for 42 minutes.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

The hon. Gentleman says that I have been speaking for 42 minutes, but I have been taking interventions from Opposition Members. He would slag me off if I did not take interventions from hon. Members who want to ask about their councils

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

It is only a three-hour debate.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

It is a three-and-a-half-hour debate. The hon. Gentleman is trying to divert attention from what I am trying to say.

We challenge the Labour party to say whether, in the unlikely event that it were to form the next Government, it would also proceed with the second-stage study. It seems reluctant to do so. I ask again whether the hon. Member for Hamilton would do it. Perhaps Opposition Members would prefer not to lift the lid on local government spending, for fear of what they might find. Council tax payers will doubtless draw that conclusion.

I repeat that reasoned, realistic, informed debate benefits local government. We have recent examples to prove it. The serious and thoughtful representations from a number of councils led us to review the capping limits set for 15 relatively low-spending councils, which argued that it was unfair that they should be permitted only the same year-on-year increase in capped expenditure as high-spending councils. The councils that argued for an increase in their capping limits accepted that the additional costs would have to fall on their council tax payers. That change in capping limits would push up council tax levels and local authority self-financed expenditure by £10 million.

As we tirelessly try to explain to Opposition Members, that increase in public expenditure can be afforded only by making offsetting reductions in other expenditure programmes. We have explained our intention to reduce the level of local authority capital consent that will be issued for next year, by some £10 million. That will come from a supplementary allocation later in the year.

A further reasoned and realistic proposal put to us concerns the so-called "spend to save" scheme. We accept that some authorities face difficulties in adjusting their existing spending patterns to what can be afforded, while protecting the front-line services to which we all attach priority. At the suggestion of COSLA, we have agreed to grant councils additional flexibility within the total resources available to them, to allow them, if they so wish, to use some of their capital provision to secure savings on their revenue budgets. No new resources are available for that purpose, but it will give councils more room to manoeuvre in setting budgets. Officials are discussing as a matter of urgency the practicalities of that with councils that are interested in the scheme.

These measures genuinely help local government—unlike the constant repetition of tired and implausible claims about cuts and underfunding. The measures recognise the reality of public expenditure—that more for one programme means less for another. Altogether, the settlement for next year is very favourable. I challenge the Labour party—which has ambitions to form the next Government—to say whether it would increase the settlement and, if so, where that additional money would be found. If, as I suspect, Labour Members remain silent on that, I must ask whether—in line with their past practice following such debates—they plan to divide the House on the orders. If so, why? Yet again we shall see the inconsistency in the logic of the Labour party in Scotland. For my part, I commend the two orders and the two reports to the House.

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State 4:26 pm, 4th March 1997

The Secretary of State for Scotland, the hon. Member for Banff and Buchan (Mr. Salmond) and I were stuck on the 10 o'clock Edinburgh shuttle for some three hours today. Clearly, we have been forgotten down here in the interim.

I start by welcoming the special grant report that has been tabled in relation to Dunblane primary school. I fully support this order and the moneys that have been made available. The order is a reflection of a tragedy that occurred almost a year ago, which united this House. There were unavoidable costs attached, and let us hope that those are never to be incurred again. We fully support and agree with the moneys provided to cover those costs.

I cannot say the same for the rest of the Government's plans for local government. One of the more disappointing aspects of this important debate—in which we are considering local government on the edge of a general election—is that the Secretary of State for Scotland did not open it. His predecessor had the guts to come to these debates most years, and did not put up some clone in his place. This is the key local government debate of the year, and the right hon. Member for Galloway and Upper Nithsdale (Mr. Lang)—the Secretary of State's predecessor—did not desert the battlefield when it came to defending the indefensible policy of the Government.

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

My hon. Friend the Under-Secretary of State for Scotland is perfectly capable of putting the case for local government. The difference between the situation when my right hon. Friend the President of the Board of Trade was Secretary of State for Scotland and now is that, in his day, the Labour party was arguing for more money, and was not supporting the Government.

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

I do not think that that is sufficient excuse. The right hon. Gentleman is not capable of defending the Government's indefensible position on local government. People outside the House will reach the right conclusion.

I will state our position on local government and local government expenditure, but it is for the Government, in their dying days, to tell us why they have allowed this situation to develop, and why they promote this settlement. The Minister, whom the Secretary of State seems to trust, has signally failed to do that. Despite taking 47 minutes of a three-and-a-half hour debate, he gave no explanation of why local authorities across Scotland have been put in such a position, or why council tax payers must pay the penalty.

The Secretary of State fiddles, like some tartan Nero, on the eve of a general election, while communities across Scotland suffer the consequences of his settlement. That is another example of the arrogant complacency that has been the hallmark of his period in office, which has meant that he has barely risen a fraction in the opinion polls, despite our momentary drop.

Photo of Mr Phil Gallie Mr Phil Gallie , Ayr

Does the hon. Gentleman accept that one of the disappointments of these debates is the way in which he talks down to Conservative Members and uses personal abuse? He should stick to the issues. Is it not a greater disappointment to him that the majority of Scottish Labour Members have not turned up? Perhaps they are all on foreign trips.

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

The hon. Gentleman says that it is a pity that we resort to personal abuse; then personally abuses people who are not even here. That is the sort of consistency that we have enjoyed from him during his brief period in the House.

This is an important debate about what the Government propose this year for local government. As local government takes up almost half the Scottish Office budget, it is a subject of more than average relevance to the House and to Scotland.

Not one independent commentator on local government in Scotland agrees with what the Minister told the House. They all agree that council tax bills will go up way above inflation, that compulsory redundancies will be forced on councils, and that there will be real and painful reductions in services across Scotland: all because of the Government's grant settlement for this year. I doubt whether the Minister expects anyone in Scotland to believe his fiddled statistics.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

I challenge the hon. Gentleman again to say how much more he would give if he were in government. How much, and from where?

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

I will deal with that precisely later. No incoming Government could repair in their first 18 months the damage of the economic failure of 18 years of the Conservatives. I make no pretence about it. My right hon. Friend the Member for Dunfermline, East (Mr. Brown) and I have made it clear that we are not likely to find extra hidden caches of money left behind by the Government when they lose power. We have to accept the spending limits that have been laid down for the current year.

Mr. Bill Walke:

rose

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

Perhaps the hon. Gentleman will wait while I answer the Minister.

We will have to live with the totals, but we will have wholly different priorities. We will put extra money into education in Scotland by abolishing the nursery voucher scheme and providing places for all four-year-olds in Scotland. By abolishing the assisted places scheme and reducing class sizes for the first three years of primary education, we will put extra money into education in Scotland. Through other means, we will find more money for the education system of our country, because that is vital for our future competitiveness. It would be wildly irresponsible to do that when the statistics are not available.

Mr. Walker:

The hon. Gentleman criticises the Government on the basis of figures that they provided from the Red Book and other sources. Government is about determining priorities. What are his priorities? Which budgets will he reduce to increase other budgets? He should remember that we have not all been in the House for a short time. Will he say just what he can do? I do not mean palliatives such as the little bits and pieces he mentioned. In real money terms, what changes will he make?

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

No wonder the hon. Gentleman wants to know—the Conservative Government will not tell the people of Scotland anything about what they would do if they won the next general election. One would think that the election had already been won—that Labour were the Government and the Conservatives were the Opposition. The Conservatives no longer have any responsibility, any ideas or any clue about what they will offer the people of Scotland in future.

Where did the Secretary of State manage to find £500,000 for one opted-out school, which just happened to be in his constituency? He told us last year that they were strapped, that there was no extra money to help local government and no extra money for education or for the health service, yet halfway through the year £500,000 was spirited up.

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

Will the hon. Gentleman give way?

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

If the right hon. Gentleman will sit down and wait for a minute, I shall. One of his great problems is that he seems to be incapable of listening—he always wants to be telling. The Secretary of State might be better off, on the edge of an election, if he was capable of listening to the Scottish people instead of lecturing them. Now let him ask his question.

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

I was hoping to answer the question that the hon. Gentleman put to me. He asked where the money for the opted-out schools came from. There is a Budget line for it—it is all published, and the hon. Gentleman can see our priorities. If he wishes to have other priorities, he should say where the money will come from, and stop pretending that the information is not available to him. When he says that he will abolish nursery vouchers, that is extra money for local government-an extra £30 million in year one. Where is the hon. Gentleman going to find that extra money he is promising? If he is not promising extra money, why is he opposing the settlement?

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

We are opposing the orders tonight so that the Government can go back and look again at their priorities. The Secretary of State says that he found the £500,000 for the one opted-out school in his constituency from a specific Budget line—of course he did not do that. When, in the Scottish Grand Committee, he threw a document across, it was a generalised figure of £24 million for education in Scotland.

The right hon. Gentleman is able to do that, just as the Conservatives during their tenure in the Scottish Office wasted £1 billion on the poll tax. In the straitened circumstances in which they insisted they found themselves, the Government were able to waste—lose in a black hole£1 billion of taxpayers' money on a failed experiment in local taxation whose residue is felt even today.

The Government have managed to lose or waste billions of pounds on the privatisation of the railways; £30 million was wasted on Health Care International—

Photo of Andrew Welsh Andrew Welsh , Angus East

Will the hon. Gentleman give way?

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

If the hon. Gentleman will let me finishing reciting this catalogue of waste for which the Government are responsible, I shall be happy to listen to how his party will pay for everything on every account.

The Government lost £30 million on an investment in a private hospital at Clydebank.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

Those are last year's figures.

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

Last year's figures—last year's waste and last year's mistakes. Yes, but they were all found within a Scottish Office budget, and when we come to power, we will scrutinise that budget with great care to see where savings can be made and waste prevented. What about the £1 million that the Government are going to spend on advertising the voucher scheme that almost no one in Scotland actually wants? Where will the money come from to enable them to push that scheme down people's throats on the edge of the election?

Photo of Andrew Welsh Andrew Welsh , Angus East

Will the hon. Gentleman give way?

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

I shall give way to the hon. Member for Angus, but I stress to the House and to failed Tory Ministers that they were responsible for that waste—they were able to find that money. We will change the priorities within the Scottish Office budget and within every other budget in the land, and people will notice right away where our priorities are.

Photo of Andrew Welsh Andrew Welsh , Angus East

I want to ask a specific question. Would the hon. Gentleman wish to continue the policy of the self-financing public sector pay awards?

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

We intend to finance pay awards next year out of the existing settlement—my right hon. Friend the shadow Chancellor has made that absolutely clear. The Scottish National party believes that anything may be financed. I wonder what sort of settlement the hon. Gentleman would impose. Clearly, SNP councils have had to live with the existing budgets.

I return to the local government settlement, and to the deceit and the fiction of the Government's case. We are used to the broken promises and lies about taxation from this Government. The fact is that, even according to the Government's figures, permitted expenditure this year will rise by only £75 million, or 1.4 per cent—and that is before new burdens placed on local government by central Government and Parliament are taken into account. We have yet to deal with the deception regarding the cost and the savings of local government reorganisation, and the self-financing awards have yet to take place.

The Government's case is simply not true. As I said, no independent commentators in Scotland or elsewhere will support the Government's contention that more money is being made available in real terms to local government in Scotland. Councils must finance new burdens out of this year's settlement.

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

The hon. Gentleman should sit down. We shared a cab today, but that is all that I am willing to share with him at present.

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

We are back to the old "kissing cousins" relationship between the two extremities of Scottish politics. However, the people of Scotland will continue to choose the middle ground. Even in today's poor opinion poll, we are 20 per cent. ahead of the party of the hon. Member for Banff and Buchan (Mr. Salmond), and 30 per cent. ahead of the Government. That says it all.

New burdens have been imposed on local government. It must finance the installation of seat belts in school transport. The landfill tax from last year's Budget has produced huge burdens for local authorities across Scotland. Increased burdens have arisen from care in the community and support for carers legislation passed in the House. Extra burdens have been imposed by the Children (Scotland) Act 1995 and the Disability Discrimination Act 1995. Higher contributions are required from local authorities for police and fire employees. Those additional burdens have been imposed upon local government in the past year, and they will not be funded by the Government.

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

I have given way to the Minister twice. He spoke for 47 minutes in a three-and-a-half-hour debate. Many of my colleagues wish to speak also, so perhaps he should sit back and listen rather than talking all the time.

Photo of Miss Janet Fookes Miss Janet Fookes , Plymouth Drake

Order. Hon. Members will recall that "Erskine May" asks us to conduct debate with moderation and good temper. The debate seems reasonably good-tempered at present: let us keep it that way, and possibly improve it.

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

I hope that the Minister will take that rebuke on board.

Photo of Miss Janet Fookes Miss Janet Fookes , Plymouth Drake

Order. It is not a rebuke: it is a reminder that is addressed to all hon. Members.

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

The fact that the Secretary of State did not come to the Dispatch Box today will be noted all over Scotland. The people of Scotland recognise the importance of the local government settlement this year.

On top of the burdens that have been heaped on local government but not financed by central Government, the Government have decided to impose their own priorities on local authorities. Despite the Secretary of State's fine words last year during the Dick Stewart memorial lecture about local government having more power, authority and autonomy, he decided to top-slice the budgets this year and impose his priorities on local government first. Some £103 million has been top-sliced for police, fire services and education.

Photo of Mr Michael Forsyth Mr Michael Forsyth , Stirling

Security in schools.

Photo of Mr George Robertson Mr George Robertson Shadow Secretary of State

I do not disagree with some of those priorities; I simply point to the contrast between the Secretary of State's claims that local government should have greater autonomy and his decision to top-slice the budgets in advance. He knows that that will mean cuts in other local government budgets. We should recognise that the Secretary of State's fine words about local government autonomy boil down to his making more choices off his own bat in areas where others previously had the right to take decisions, to make mistakes and to stand by them at the ballot box.

Another deceit at the heart of the local government settlement is the pretence that local government reorganisation has brought significant savings. Not one person in Scotland believes that daft claim. The Convention of Scottish Local Authorities and the Chartered Institute of Public Finance and Accountancy established a joint committee to examine the cost of reorganisation. They asked the Government whether they would care to be involved, but, significantly, the Government said that they would not co-operate with the study.

That independent study found that the Government have under-estimated the cost of local government reorganisation by some £200 million, resulting in a hole of £50 million in this year's local government settlement. Only a few years ago, the Government set out to gerrymander a wasteful, unnecessary, unresearched and under-prepared reorganisation of local government. It was inevitable that that botched reorganisation would cost money, and they now expect the taxpayer to pick up the tab for that gargantuan and enduring Tory folly. That £50 million hole as a result of local government reorganization—which the Government pretend is a saving—lies at the root of certain problems facing councils today.

The reorganisation has created particular problems for some councils. Councils such as City of Glasgow, East Dunbartonshire, Dundee, Argyll and Bute and Borders have been left to swing in the wind as Ministers fail to recognise the consequences of reorganisation. In some cases, those consequences have had brutal effects on services—and they will have an even worse effect on council tax payers.

Ministers stand back, as though they had nothing to do with the reorganisation or the disaggregation of staff and budgets, and allow those councils to swing in the wind. It is a total abdication of responsibility by Ministers, who pretend that they had nothing to do with creating the new local government set-up: it is almost as though a pure accident of fate created 29 mainland councils in Scotland. All the consequences are ignored, as the problems pile up—problems that were created simply by the way in which the reorganisation affected local government financing.

We stand for partnership in local government, not provocation. We will replace the destructive confrontational approach of the present Government with a constructive partnership with local government in the public interest. We shall not be easy on councils next year as we try to sort out the debris of the Government's economic stewardship. Eighteen years of damage inflicted on government, particularly local government, cannot be resolved in the first 18 months of a Labour Government, but there is the prospect of a better future for local government.

We will tackle the problem of council tax collection—a legacy of the poll tax—and we will give councils the extra powers they require in order to ensure that the money is collected. We shall ensure that value for money is the criterion, not simply cheapness of product; that is why the crude competitive tendering that the Government have stood for over the years will be swept away and a better, quality-based system put in its place.

We shall set up an independent review into the relationship between central Government and local government in Scotland—a partnership review, which will allow all these things to be examined, and if that means that we are considering the distribution formula or the way in which that formula is organised, I expect that COSLA will want to participate in considering how it can or could be improved.

These are ways in which we shall make progress in our relationship with local government if we are returned at the election in only a few weeks' time.

In the meantime, it is, I fear, an unfortunate fact that the present Secretary of State has a grudge against Scottish local government. He clearly wants revenge, as does the Conservative party, on a local government structure that the Conservatives gerrymandered for their own interests but which did not deliver a single Tory council to them two years ago. That is the only possible explanation for this year's punitive settlement, and for the parade of fraudulent propaganda about extra money for local councils, which every member of the Scottish public knows not to be true.

I believe it was two weeks ago last Saturday that the Secretary of State for Scotland told BBC radio's "Newsround" programme that he wanted to give more power back to local councils, and that he had even prepared a devolution to local government Bill, of which nothing has been heard since. No one believes him on the Bill or on his intentions about devolving more power to local government. He has become the enemy of local democracy, whether at council or Scottish level.

However, the real tragedy, I fear, about this vengeful confrontation is that the victims of the Secretary of State's prejudice will not be the Tory Ministers who will bite the dust in the next few weeks, but the vulnerable people throughout Scotland who depend on local government services—on home helps, care assistants and those who work in local government—and the millions who will pay a hefty price in their council tax bills for the Government's dismal economic failure.

Those people who will suffer, those people in local government who will lose their jobs, and those people who depend on the services of local government, will certainly remember the Government—but they are unlikely ever to forgive them.

Photo of Mr Hector Monro Mr Hector Monro , Dumfries 4:51 pm, 4th March 1997

After 21 minutes of the hon. Member for Hamilton (Mr. Robertson), I must say that I preferred 42 minutes of the Under-Secretary of State for Scotland, my hon. Friend the Member for Kincardine and Deeside (Mr. Kynoch).

We had 21 minutes of cliché, riddled with perorations that kept mounting and falling away, and then it was the usual story—when the hon. Member for Hamilton is asked questions, he is always going to answer them but never does. Whether the subject is local government or the tartan tax or anything else to do with government in Scotland, he sits on fences watching them crumble beneath him, and never answers. He never gives a clear answer; even in the effort that he made in the Sunday newspapers to clear up the tartan tax, he sat on the fence and dodged most of the issues, and he knows it.

The performance of the hon. Member for Hamilton this afternoon was most disappointing. I want an answer from him—if not from him, perhaps from the hon. Member for Edinburgh, Leith (Mr. Chisholm) later. The hon. Member for Hamilton sweeps his hands around and says, "We shall change the budget," but the only things that he was prepared to say he would change were vouchers and the assisted places scheme. Where will he get the other hundreds of millions that he says will sort out the problems of local government in Scotland?

The hon. Gentleman speaks about partnership and not confrontation. Is he looking forward to meeting the parents of the children who will lose vouchers or assisted places? Is that partnership? It is confrontation of the most evil kind. [HON. MEMBERS: "Hear, hear."] Parents look after their children's education, and if they have the opportunity of an assisted place or a voucher for nursery education, they will grasp it with both hands, yet the hon. Member for Hamilton says that he will sweep it away, in dictatorial fashion. There will be no chance for parents who want their children to have a better education. He is a pathetic figure, sitting on that Front Bench.

I noted today, when I was sitting listening to 21 minutes of peroration that never reached an end, that it was almost exactly this month 45 years ago that I was elected to a local authority—in a four-cornered fight, in case the hon. Member for Hamilton thinks I got in under the counter.

In many ways, local government has not changed. Throughout my years as a county councillor, we were asking, "Why can't we have more money to improve our services?", but we knew that we had to produce the money by good housekeeping, good husbandry and keeping down expenditure. The challenge was not how to increase local taxation but how to reduce expenditure. That is the challenge for local authorities. They always ask, "How can we spend more?" when the challenge is, "How can we spend less if we are to look after the interests of our many constituents in the local authority?"

I welcome what my right hon. Friend the Secretary of State is doing for the people of Dunblane; it is absolutely right, and I support that move entirely. It reminds me that the Government were so helpful at the time of the major disaster at Lockerbie, when we lost 270 people in one evening.

It is profoundly disappointing that, although COSLA was set up to try to bring the best out of local authorities, it seems only to use its Labour majority to hammer the Government, day in, day out. I should like COSLA to make a much more co-operative effort to find the right formula—the rural authorities are, obviously, highly critical of the formula agreed by COSLA—for the distribution of the block grant.

Labour councillors, independent councillors, Scottish National party and Liberal Democrat councillors and so on are not correct when they say that there are cuts everywhere, because it simply is not true. The statistics show that there are increases of £140 million—2.2 per cent.—and that cannot be converted into cuts, however one wants to jiggle the statistics, including this and excluding that, and then say, "It isn't fair." Ultimately it must be recognised that the Government have provided more money for local authorities, and that there is not a cut in their resources.

I shall mention the Labour party once more. It is not good enough—[Interruption.] Good Lord, the hon. Member for Hamilton has gone already. [Laughter.] Oh, he is back again. It is not good enough for the hon. Member for Hamilton to sit there, and stand there later, and not tell us how he intends to give more to local authorities, when his Front-Bench spokesman, the shadow Chancellor, says that there is no more for local authorities. That may be why his public opinion poll rating has plummeted today, and perhaps that is why he is so crotchety and unhappy sitting there on the Front Bench: because he knows that, once the poll begins to slide, it is very unlikely to stop.

I shall briefly mention what has been happening in Glasgow. I notice from the report given to us by the chief executive that there were 203 conference attendances by Glasgow councillors, costing in total more than £110,000. We all know that some councillors must attend some conferences. That is the way that government and local government work: I accept that, especially if one is in charge of a major city like Glasgow or Edinburgh, one must fly the flag for Scotland and for those cities. But there is a limit. Most of us would say that the Glasgow figure was in excess of what is required. Aggregate external finance per head for Glasgow is £181—by far the highest figure on the mainland. Glasgow had a case to answer, and it has not communicated it very well so far.

I shall now discuss special responsibility allowances. Of course certain members of every council must have special responsibility allowances. However, when 739 of the 1,235 councillors get special responsibility allowances, one feels that it has gone over the top. Councillors should examine the matter carefully. Certainly, convenors, vice-convenors and chairmen of committees must have such allowances, but that does not mean that 50 or 60 per cent. of the council should have them.

I was grateful to my hon. Friend the Minister for seeing representatives of my local authority, Dumfries and Galloway, and I was pleased that under the new arrangements, he was able to increase the capping limit by £784,000 to £159.2 million. That is a welcome increase to the council's resources, although it is recognised that there will be an increase in council tax.

I was pleased to note an increase of £3.2 million, or 2.2 per cent., in aggregate external finance. The AEF per head for that council is £140, which is the seventh highest figure out of the 29 mainland authorities.

I highlight the fact that Dumfries and Galloway council has had an increase in its resources and in its capping limit. Councillors should not go around crying wolf and complaining that they have had to make dramatic cuts because of the Government's limit on resources. The council has set its own budget £10 million above the figure that the Government consider appropriate expenditure. That budget is being cut, not the money that the Government have given the council for distribution. I hope that councillors will stop giving the impression that the Government have dramatically cut council resources.

Councillors must not mislead their council tax payers. Last year, I thought that, in the budget strategy statement that went out with council tax demands, the council had been a little economical with the truth about where the cuts had come from. The statement did not highlight the fact that it was the council's budget, not the Government's, that had been reduced.

I have received a stream of letters from my constituents, especially on education. Perhaps they did not realise that, in its block grant, the authority has great flexibility, and can decide spending priorities. I am worried that music education, school buildings and library services all seem to be suffering, although the Government have encouraged greater spending on education, just as they have ring-fenced spending on the fire service and the police. In the block grant, I hope that there will be provision to ensure that elderly folk are properly looked after, with regard to transport and retirement homes.

It is for councillors to set priorities within the block grant, which, I emphasise again, has been increased this year. They may have a point when they say that the COSLA formula may not be in favour of rural areas. That should be re-examined. I hope that there will be no redundancies. The majority of council staff can be retained within the present budget, although I know that the council is making every effort to reduce expenditure.

I put some blame on COSLA for the level of payment to officials. In my authority, with 150,000 inhabitants—150,000 voters would be easier, in terms of statistics—no fewer than 48 officials earned more than £40,000. I know that that has been adjusted, as was clearly necessary.

In view of the budget that has been set, an increase in council tax is inevitable. I shall be disappointed if it cannot be held at 11 to 12 per cent. That is far above inflation, but it is the best that can be hoped for. I hear rumours of a 15 to 20 per cent. increase, which would be unacceptable. I hope that the council will take the matter seriously, especially as the amount of uncollected tax stands at £8.1 million.

I put on record the impact that Labour might have on business rates, which are extremely important in rural areas such as mine. The Secretary of State has acted to assist business rates over recent years.

I am glad that we have been able to keep capital expenditure at a good level, so that contractors and other local business men will benefit from it.

My hon. Friend the Minister repeatedly asked Labour Front-Bench Members how they would change the finances of local government without increasing taxation. The tartan tax, which would not go very far, would be singularly unfair to the Scots people. How will it be done? The Scots people are entitled to know before the election what form of taxation or adjustments to the budget will be introduced by Labour to finance local government in Scotland.

The Opposition are highly critical of the present system, but they have not given one iota of consideration to what they will do, other than scrapping vouchers and dealing with assisted places. Those constitute a drop in the ocean, out of the huge budget of the Scottish Office. The Opposition are failing the country by not revealing what they will do, so that everyone can gang up and vote against them when it becomes clear that their plans are unacceptable.

Photo of Michael Martin Michael Martin Chair, Administration Committee 5:05 pm, 4th March 1997

The director of finance of Glasgow district council told the Minister on Friday that it was all very well for the Minister to say that Glasgow had more money, but in respect of police and fire services and the nursery voucher scheme, more burdens have been put on the city of Glasgow. In real terms the capping limit is down by £2,683,000, which means that Glasgow is getting less than it got before. The Minister should take that on board.

I heard the Minister comment on Friday about trips that councillors made abroad, and the right hon. Member for Dumfries (Sir H. Monro) also referred to the matter, but not for any vexatious reason. The Minister is the Minister for Local Government, and at any time he can call Glasgow or any other local authority to account. He started making public utterances only when the matter was raised in the press.

I am not here to question the wisdom of any of those trips, but I want to put it on record that every councillor in Glasgow, especially those who met the Minister on Friday, has behaved honestly and worked according to the legislation. No one should imply otherwise.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

That is not what I was suggesting. I suggested that it was a strange prioritisation of expenditure for councillors to go on those trips at a time when they were trying to make massive cuts, as they call them, and reduce jobs. Prioritisation is the responsibility of government, whether national or local.

Photo of Michael Martin Michael Martin Chair, Administration Committee

I was worried that in his public utterances the Minister had implied that the councillors had acted dishonestly. If he thought so, he as the Minister responsible should be able to call anyone in local government to account.

For the first time in my parliamentary life, and for the first time, I think, in the lifetime of Parliament, following the activities of certain hon. Members, we have been required to employ the services of Sir Gordon Downey, because hon. Members have not conducted themselves as the House would expect. If anyone wants to hurl stones, he should look at our own problems. I speak as a Member of Parliament who is not one for travelling abroad. I am deeply ashamed of the fact that we had to bring an outsider into the House to regulate our affairs. Perhaps we should examine our own priorities.

The £9 million deficit of which the Minister spoke was left by Strathclyde regional council, an organisation that he disbanded—against the advice of the vast majority of hon. Members who lived in the region or represented seats there. Glasgow cannot go to Strathclyde council and say, "We want our £9 million", because the Minister has disbanded it. The Glaswegians would have had £9 million in the current year had it not been for the Minister's decision.

The Minister went way over the top when he said that the councillors were only scaremongering. Ninety-day notices have been sent to every employee in the city of Glasgow. Is that scaremongering? Because the councillors must act in accordance with legislation laid down by the House, people are in danger of losing their jobs. That is far from scaremongering. If it is scaremongering, can I tell the home helps in Dennistoun, Possil Park and Springburn that they will not lose their jobs? Two thousand decent men and women may have to go down the road unless we can persuade the Government that more funds should be put into our city.

I hope that the Minister will stop attacking local government, which is in the front line of our caring services. Without home helps, many old people would go from one day to the next with no human contact—without hearing words of comfort from another human being. Our old folks' homes in Glasgow are second to none. They were not built last week or the week before; they were built up through the dedication of men and women in local government. Those people gave their all to local authorities: they worked during the day, and went to council and tenants' association meetings at night. They got rid of places such as Forest Hall, which used to be a workhouse.

When I was a young councillor in Springburn, that old workhouse—set up under the old poor law—was still there. That it is no longer there is to the credit of Pat Trainer, a union official and councillor who was one of my colleagues. Some of my hon. Friends know him. His life's dream was to see Forest Hall destroyed, and replaced by three old folks' homes. How can the staff in those homes, which are second to none, continue their dedicated work if they risk losing their jobs? The great law-and-order party tells us that it will give more money to the police. What is the point of lifting young delinquents off the streets if we are closing youth and community centres? That is what we are doing now, because of the Government's decisions. We are giving more power to the police. When we were youngsters, the police always told us that the best thing that we could do was keep off the streets and not get into trouble. How can policemen say that in this day and age?

We have lunch clubs enabling elderly people to get out for half a day, giving their carers some respite and time to draw breath. Those clubs are now going to close.

The Minister knows the city of Glasgow. Indeed, he was there last Friday. He will be aware that there are no green fields in the city; it is surrounded by other local authorities. Some of those authorities are, quite unfairly, feeding off Glasgow's services, and are not prepared to put anything into our city. The Minister will say, "But I meet members of COSLA, and they reach a collective decision. They all feel that the formula is fair." Every time I meet councillors from outside Glasgow, they say that Glasgow is a special case because thousands of people go into the city to work and then leave at night—including a good many of the constituents of the hon. Member for Eastwood (Mr. Stewart). I hope that he will fight the cuts, because some of the 2,000 people who are going to lose their jobs come from his constituency.

Every councillor whom I have met has said that Glasgow is a special case, but none of them is prepared to say the same when they get together in organisations such as COSLA. Anyone who knows Glasgow and its problems must accept that it needs extra finance. The Minister is doing a disservice to men and women who have dedicated their lives to local government, and I hope that he will reconsider.

Photo of Mr Allan Stewart Mr Allan Stewart , East Renfrewshire 5:15 pm, 4th March 1997

The hon. Member for Glasgow, Springburn (Mr. Martin) spoke mainly about the city of Glasgow. As the House knows, he speaks from a base of enormous personal experience and knowledge of local government in that city. I shall return to one or two of his points, but first let me tell him that, if the Scottish Labour movement regards Glasgow as a special case, the solution is in its own hands. It runs COSLA; it has the dominant majority on the distribution committee. No formula to change the figures has emerged from that dominant body, however.

The first Opposition speaker today was the hon. Member for Hamilton (Mr. Robertson), who has slipped out of the Chamber. I make no complaint about that. As my right hon. Friend the Member for Dumfries (Sir H. Monro) said, the hon. Gentleman seemed a bit ratty today: he was not at all his normal sunny self. I do not know whether that was due to the company that he kept this morning or to the opinion polls—

Photo of Mr Phil Gallie Mr Phil Gallie , Ayr

He is always like that.

Photo of Mr Allan Stewart Mr Allan Stewart , East Renfrewshire

No, he is not. My hon. Friend is unnecessarily critical of the hon. Gentleman.

I think that the hon. Gentleman was ratty because he was rattled by my hon. Friend the Minister. My hon. Friend asked him about the silence of the Opposition Front Bench, and he remained silent on that key point throughout his speech. Surely it is not unreasonable for those in local government in Scotland, and Conservative Members of Parliament, to say to the hon. Gentleman and his colleagues, "We are within a few weeks of a general election. You hope to become Secretary of State. Will you tell us—not every detail but in broad terms—what you would actually do?" The answer is fairly clear—for there was an answer: there is going to be an independent review of relationships between central Government and local government in Scotland. "Vote new Labour. Paradise regained. Another quango." That is a message to have them rolling with enthusiasm to the polling stations on election day: a new vision for Scottish local government.

It was unworthy of the hon. Member for Hamilton to suggest to my hon. Friend the Minister that there was something wrong in his opening the debate, rather than the Secretary of State. I recall opening such debates myself, when Opposition Members consistently made speeches, year after year, in which they said that the end of the world was nigh. The same message—"This local government settlement is the worst thing that has happened to the people of Scotland since Flodden"—came from the Opposition Benches year after year after year. Every year until now, Opposition Members have said, "It will be all right. Wait for a Labour Government." The message is different this year, however. It is, "If you get a Labour Government, we will not change the figures at all." In fact, as the hon. Member for Hamilton did not admit, the figures in the second and subsequent years would be worse, because the Opposition plan a Scottish parliament with no net increase in public expenditure. Where would the money come from? It would have to come from local government.

Photo of Mrs Maria Fyfe Mrs Maria Fyfe , Glasgow Maryhill

Has the hon. Gentleman ever made an estimate of the benefit that the residents of Eastwood gain from Glasgow services while contributing not a penny to them?

Photo of Mr Allan Stewart Mr Allan Stewart , East Renfrewshire

The residents of Bearsden and Strathkelvin will be very interested to hear that attack from the Labour Benches, which was unanimously supported by Scottish Labour Members who are present. The Labour party believes that the residents of Bearsden and Strathkelvin are all parasites. Let that message go throughout Bearsden and Strathkelvin. Of course they are not parasites, and nor are the residents of Eastwood.

If the good people who run the city of Glasgow believe that people are getting services for free, I would not stop them charging for their libraries, galleries or whatever. I would be in favour of charging. Let them stop complaining, because they have £21 million of mismatch money. That is other people's money. It rightfully belongs to the people of Strathkelvin, Bearsden, East Renfrewshire, Renfrewshire and elsewhere.

Photo of Mr Phil Gallie Mr Phil Gallie , Ayr

Does not at least 65 per cent. of local government funding come from general taxation? Therefore, do not the residents of Eastwood probably contribute more than their fair share?

Photo of Mr Allan Stewart Mr Allan Stewart , East Renfrewshire

My hon. Friend is being modest in that figure. The real figure is some 85 per cent. It would not be difficult for me to make a case saying that East Renfrewshire is grossly over-subsidising Glasgow. It is a fact—

Photo of Mr Allan Stewart Mr Allan Stewart , East Renfrewshire

I will give the hon. Lady an important figure if she will just pin her ears back. Aggregate external finance per capita for the city of Glasgow is 80 per cent. above the English average—that is money from the general taxpayer—so let us have none of this nonsense about Glasgow not getting a fair deal from the Government.

The hon. Member for Hamilton implied fairly clearly that Labour would not change the overall settlement, except for assisted places and nursery vouchers. As I have said before, the House is indebted to the hon. Member for Angus, East (Mr. Welsh) for pointing out in detail what Labour's assisted places pledge means in terms of the figures. My right hon. Friend the Member for Dumfries rightly and properly talked about the argument. There would be one extra teacher per constituency—a wonderful pledge. Labour would also abolish nursery vouchers. I know something about nursery vouchers, because East Renfrewshire was one of the pilot authorities for the scheme in Scotland.

My hon. Friend the Member for Aberdeen, South (Mr. Robertson), the Minister with responsibility for education in Scotland, should go into the "Guinness Book of Records", because he introduced the nursery voucher scheme—a major Government initiative—and nobody is complaining about it. Not a single resident of Eastwood is complaining about the scheme. It has been an enormous success in a Labour-held authority, but it would be swept away by the ideology of the Labour party.

I hope that my hon. Friend on the Front Bench will confirm my understanding of the figures for East Renfrewshire council. I understand that the permitted increase in expenditure is some 7.63 per cent. and that the grant-aided expenditure is up 6.79 per cent., before allowing for the mismatch adjustment. Those figures seem perfectly reasonable, if not generous.

I shall say a word on the trips-for-votes controversy, as hon. Members from Glasgow seem a bit edgy about it. Nobody is suggesting—or has suggested—that Glasgow councillors have done anything financially improper. On the point about roses, it is reasonable, however, to ask, why councillors did not just get into one of their 27 or 28 limousines and go across the boundary into Eastwood, where, of course, we have blue roses. Looking down the list, I can see that they went all over Europe to look at roses—Rome, Dublin, Belfast, Paris, Geneva. I do not complain about that, but they cannot say, "We have the worst financial crisis in history," and, "We are wholly underfunded by the Government," and at the same time go around the continent looking at roses. That results in a certain lack of credibility about their initial posture. That is a valid criticism. As my hon. Friend the Minister said, it is a question of priorities.

Mention was made of the shadow Chancellor and what he said. Paradoxically, he has done Scottish local government a favour, because too many people are misled by Opposition Members, who say, "It's all right folks.

Wait for a Labour Government. There will be a new nirvana. Money will be pouring from everywhere for you. All will be resolved." That will not happen. If that means that there is greater concentration on financial reality, it will be in the interest of Scottish local government. It will be in the interest of those who work in Scottish local government, those who pay for Scottish local government and those who receive the services of Scottish local government.

Photo of Mr Archy Kirkwood Mr Archy Kirkwood Liberal Democrat Chief Whip 5:26 pm, 4th March 1997

This is a terrible debate. The temptation to blame others for what is going on is strong. Indeed, we are all guilty of it. As the hon. Member for Glasgow, Springburn (Mr. Martin) rightly said, people's jobs are at risk, schools and residential homes are being closed and pools are being shut. I do not know who is to blame, but anybody involved in what is going on would be disappointed if they listened to the debate.

All hon. Members know that the Government set total spending limits and grants. They also set overall and local expenditure. If the Red Book three-year public expenditure survey allocations are adhered to—whether by a Labour or Conservative Government—local government will have to change fundamentally.

If Governments insist that local government save money year—on year-we are in the fourth year of funding salary increases from efficiency savings—it will have to consider displenishing in its entirety all community care provision in residential care homes. It will have to consider moving out of local education authority service provision and leave schools to manage themselves. Local authorities will have to consider full-scale privatisations to such an extent that they will become nothing more than contract-fixing bodies.

It is possible that that could happen and the world would not end, but if my constituents were given a choice between what I have described and finding the appropriate finance I am pretty confident—I can speak only for my area, as I do not know about Glasgow—that they would be willing to spend more to get properly funded services. I stood in the sleeting rain on Saturday morning in Jedburgh square, where 1,500 people were shivering in the rain. They were incensed that, on Thursday, the local authority will probably shut their swimming pool. Young people will not have a pool in which to swim, and worse still, doctors will not be able to recommend therapeutic services for elderly people who now receive new treatments in fitness centres instead of taking pills. Youngsters who used to go to the pool on a Friday night will be thrown out on the streets. People are incensed that, for want of £100,000, that facility is to close.

Jedburgh has a sizeable community: it is one of the largest towns in my constituency. The people of Jedburgh cannot just get on a bus and travel to another pool. Even if there were a bus, they would have to travel miles to get to a pool and back, and would take two days to do so.

Local government finance is supposed to enable local authorities to provide a generality of services that are standardised throughout the country. Small authorities may have special circumstances and special problems, because they start with low baseline budgets and cannot find the efficiency savings that the Government require them to make. It may not be the end of the world, but this year, for the first time, Scottish Borders council will close pools, rural schools—not for educational but for financial reasons—and residential homes. That will not only hurt those who will lose their jobs or access to the services, but cost more in council tax.

People in my part of the world are bamboozled. They do not know how this has come about and whom to blame. The system is opaque, defying attempts to work out whether the local council is doing the right thing. All people know is that they are suffering: their kids are suffering, and their old folk are suffering. On Thursday, decisions will be handed down by the local authority which will cut the fabric of society to the bone, and people will resent that.

The general election is approaching, and I am quite open about the fact that I believe that local government is underfunded by about £150 million for the coming year. My party has said that extra money should be raised, especially for education. When the general election comes and I am going about my business as a candidate in Roxburgh and Berwickshire, I will proudly get on to soap boxes and ask people to pay for education. People at demonstrations that I have attended—I shall be taking part in more of them at the weekend—will cheer me to the echo.

That is my assessment of the political situation. No one is asking for profligacy or waste, and no one is defending what is going on in Glasgow—I do not know anything about people taking trips, incidentally. All I know is that, with a budget of £100 million, my local authority has been put into an impossible straitjacket from which there is no escape, and people in south-east Scotland are hurting.

Photo of Mr Phil Gallie Mr Phil Gallie , Ayr

The hon. Gentleman referred to an extra £150 million for local authorities, which is more than 1p in the pound on income tax in Scotland. He has also said that the Liberal Democrats would raise 1p in the pound specifically for education. Does that mean that they want to raise income tax by 2p in the pound? Education is only part of local authority expenditure. Higher education must be paid for as well, and I presume that some of that 1p for education would be spent on higher education.

Photo of Mr Archy Kirkwood Mr Archy Kirkwood Liberal Democrat Chief Whip

The Government have charged us to say where the money will come from, and I am trying to quantify what is required to achieve a sensible settlement for local government next year. Given the figures available to me, my assessment is that £100 million or £150 million is required to provide services of the same high quality as in the past.

My party voted against the tax cuts, without which £2 billion more would now be available. If the Scottish share of that were put into the local government budget, it would provide a 3 per cent. increase, which would amount to between £150 million and £180 million. I would have to persuade the public that that is necessary if they want the services. If they want to have lower taxes and to pay for taxis to take them 40 miles to a swimming pool because the pool in Jedburgh is likely to be closed on Thursday, that is up to them. As a Liberal Democrat and someone who is trying to make sense of the local government settlement, I think that not enough money has been provided.

Education is a priority for Liberal Democrats—I suppose that it is a priority for everyone. We cannot duck the fact that we have had a good education system in Scotland, because we have invested more in it, and I want that to continue.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

The hon. Gentleman is making a thoughtful speech. He suggested that his party would provide extra funding. Has he studied the Coopers and Lybrand and Peida report, which shows that local government in Scotland is well funded across the board? We should seek improvement and value for money, not throw more money into local government.

Photo of Mr Archy Kirkwood Mr Archy Kirkwood Liberal Democrat Chief Whip

I am as keen as anyone to obtain value for money and efficiency savings. I look forward with enthusiasm to engaging in the argument on the Peida report. I can give the Minister two examples off the top of my head. The local authority in Northumberland may receive less per head than the Scottish Borders council, but many of the development workers with the local development commission are not taken into account. It has park rangers coming out of its ears, and they are not taken into account in the local government settlement for Northumberland. So long as the Peida report covers the professionals who deliver the services and obtains a true, costed comparison, I will happily meet the Minister any place, any time, to discuss the nitty-gritty.

Of course, I want efficiency savings: we must ensure that we get value for money. But people would be more enamoured of what we are doing if we provided the proper resources. The hon. Member for Hamilton (Mr. Robertson) referred to the new responsibilities that Parliament has given local authorities. Professionals north of the border estimate that the financial burden for community care in the next financial year will be £123 million. I accept that the Government have made allowances for that in the settlement, but the Scottish Office provision is £55 million, which is nowhere near £123 million. Those professionals are not irresponsible party politicians: they are trying to make proper provision under the legislation that the House passed. We give them half the money required to do that—Parliament must stop doing that.

I sponsored the Carers (Recognition and Services) Act 1995, which was introduced by a Labour Member. Professionals estimate that it will cost £50 million next year. What have the Government allowed? Zilch, zero, nothing. It is unconscionable to put layer upon layer of responsibilities on the shoulders of local authorities and expect them to provide services out of fresh air. The contention that local authorities in Scotland have saved up to £60 million is merely accounting acrobatics: the figure is nothing like that, and everybody knows it.

The settlement is one of the worst that I have known since I was elected to the House in 1983. I am faced with difficult meetings. I have to respond to a petition containing 3,000 names that were collected in 10 days in Duns, which will lose its educational centre. We are losing swimming pools and sports centres, which keep the kids off the streets. The meeting about the Jedburgh pool was the most difficult hour and a half that I have spent: we all got soaking wet, but we were proud to do so if it made any difference and made the Government think again about the closure.

The Burnfoot project has been in existence for 17 years and has a proven track record. The community is proud of that facility for rehabilitating difficult children: it has been used as a model in other parts of the region. Why is it to be closed? Because the local authority has new responsibilities under the Children Act 1989, for God's sake. That Act is supposed to support kids such as those who will be thrown out the door of the Burnfoot project. It is the economics of the madhouse. In addition, Foulden school is, relatively speaking, a brand new building; its doors are going to be shut and the windows boarded up for financial reasons. That will take the heart out of the local village community. The building will be left to moulder and fall to bits, and loan charges will continue to be paid. How does that make sense? How is that to be explained to people whose kids—primary school children—are going to have to get on a bus and go 15 to 20 miles to and from school?

Those decisions are not being taken lightly by Scottish Borders councillors. They are being made because they have absolutely no alternative. They have a budget of £100 million. There is no fat left. They have no flexibility. Half the budget is for education. They are having to make swingeing cuts in services, to reduce jobs and to lower investment, and they will end up with higher council taxes.

This system of local government finance, of raising only £15 out of every £100 yet being accountable for all expenditure, is no use, has had its day and should be swept away. We need not just reviews of the relationship between local and central Government, although that would help, but a root-and-branch reform so that local councillors can truly represent the interests of their council tax payers and be held to account at the ballot box.

My party has suggested proportional representation, which will make it much more difficult for councillors to hide behind rotten boroughs, and regular elections year after year. If we started thinking in those terms, we could remove the caps and leave local council tax payers to hold the council to account if it is being profligate.

Photo of Mr Bill Walker Mr Bill Walker , North Tayside 5:41 pm, 4th March 1997

That was an interesting speech. Some important aspects of local government were covered. The hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) may find that some Conservative Members think that councillors and local government should be held more to account locally, and that the best way to do that is through financial accountability. I do not disagree with that. One of the advantages of the pressures that exist at present is that we may at long last take an in-depth and serious look at how local government is structured, funded and held to account.

People can always, as they do, blame central Government because the bulk of the money—85 per cent.—comes from central taxation. There may be merit in removing revenue raising completely from central Government and letting local government raise it all locally. We might then find that Glasgow and elsewhere would take an entirely different view of how the 85 per cent. funding is distributed.

The plain truth is that, with the Convention of Scottish Local Authorities formula, pain is being felt in all sorts of different ways. For example, no real account is taken of the substantial increase in population in my constituency. People want to live in my part of the world, which is not surprising. They want to leave the big cities and to move into country areas, where the quality of life is good. As long as we can contain the numbers, education and all the other facilities will remain at a very high standard, but we may reach a point, and we are getting close to it, where the numbers will make it much more difficult to maintain the quality of services, particularly in education, that we have enjoyed in my constituency.

I say to the hon. Member for Glasgow, Springburn (Mr. Martin) that the comments about people travelling related to doing so at public expense. If people have travelled from this place—the hon. Gentleman drew attention to that—it is important to distinguish between that which is public expenditure and that which is not. I trust that his comments were not directed at the Sir Gordon Downey aspect and at the Select Committees.

Photo of Mr Bill Walker Mr Bill Walker , North Tayside

That is what I am saying. I trust that the hon. Gentleman was not talking about Select Committees. He should read his speeches afterwards. He brought together two different activities in a way that devalued the standing of the House—that is how I understood him. If he disagrees, that is fine, but it is not the first time that he has lumped things together to make a point. He does not always understand that people outside do not have the knowledge to break down the differences, as we do in this place, and that can do terrible damage. If he is really concerned about the reputation of this place, as he claims, he should think carefully about the way he lumps things together—that is the only point I am making.

Photo of Miss Janet Fookes Miss Janet Fookes , Plymouth Drake

Order. I think that the hon. Gentleman knows my views about seated interventions.

Photo of Mr Bill Walker Mr Bill Walker , North Tayside

If the hon. Gentleman ever wants to make any comments or observations about me, just try it—that is my advice for him. I make many overseas visits that I pay for. I have no qualms about that. What is more important, I take my family with me—[Interruption.]

Photo of Miss Janet Fookes Miss Janet Fookes , Plymouth Drake

Order. I trust that the House will remember my earlier guidance. Perhaps we could now return to the subject in hand.

Photo of Mr Bill Walker Mr Bill Walker , North Tayside

Certainly, Madam Deputy Speaker. Innuendoes are made about the values and qualities of this place. The hon. Gentleman likes to give the impression that he is the only one who cares. I suggest that the vast majority of Members care, so he should be careful when he makes sweeping assertions.

I should like to know from Labour Front Benchers where the money will come from for the Scottish Parliament. I understood the hon. Member for Hamilton (Mr. Robertson) to say that no more money will be available for local government, because this is the settlement that Labour will inherit, so where will the money come from? He could not tell us what the priorities were going to be either. The speech by the hon. Member for Roxburgh and Berwickshire was important because it drew attention to the fact that people ought to know what the priorities are, which I agree with, and what they are voting for, which I also agree with.

Photo of Tommy Graham Tommy Graham , Renfrew West and Inverclyde

The hon. Gentleman will realise that we have had 18 years of Tory government and that, in my area of Renfrewshire, the Tories have been wiped out. There are only two left on the council, which the Tories used to control. They have been wiped out because of the bad Tory policies implemented by the Government. The people there want decent education, decent home help services and decent transport. That has all come under terrible attack by the Tories in the House.

Photo of Mr Bill Walker Mr Bill Walker , North Tayside

I have news for the hon. Gentleman: I am a democrat. I fully accept the wishes of the people as expressed at the ballot box. If anything I say or do gives offence, I pay for it and it is proper that I should. It is worth remembering that many Scots are what I call thrawn. They might not find any future Labour Government to their liking and the vote for the other parties in Scotland might suddenly and dramatically increase. That was the experience in the 1960s and 1970s.

The hon. Member for Renfrew, West and Inverclyde (Mr. Graham) rightly says that the Conservative party has been in government for 18 years. We are held accountable, as we should be. At the general election, we will face the electorate on the basis of having been in office for 18 years. I have watched the smiles on the faces of Opposition Members at previous general elections. At almost every election since 1979, they have assumed that somehow the Labour party would make a dramatic recovery. When it did not materialise, I had to look at the same faces again after the election and they got longer, gloomier and glummer.

Photo of Miss Janet Fookes Miss Janet Fookes , Plymouth Drake

Order. Those are very interesting reflections, but I am not too sure how they relate to the business in hand.

Photo of Mr Bill Walker Mr Bill Walker , North Tayside

They relate to the debate in that it concerns 18 years of local government expenditure in Scotland. This evening we are debating the current settlement. When one compares local government expenditure, supported centrally and raised locally in Scotland, with that in the rest of the United Kingdom, particularly England, it is obvious that other areas are quite capable of providing services. I agree with the hon. Member for Roxburgh and Berwickshire that we have to examine all the figures and compare like with like rather than extrapolating from a selected few, but it is clear that the problems do not stem from a lack of money, as substantial sums are being spent.

Perhaps local authorities should consider becoming enablers rather than providers. Some may say that that would lead to job losses, but it would be a diversion of jobs from one sector to another. If Marks and Spencer expanded a store and employed more people, but Woolworths closed part of a store and employed fewer people, there would be a transfer of employment between companies that provided the same service.

The same is true of local government. The inquiry into care in the community in Tayside supports the principle that I hope the House will accept—that, if possible, the same quality of service should be maintained. Tayside achieved a saving of £200 per head per week. If the same saving were made in other sectors, many more people would gain. What matters is the advantage to those who require the service. After all, we are all in the business of providing services for individuals who need them. That applies equally to Marks and Spencer, local government or anyone else. The individuals who require the service are often forgotten.

I am particularly concerned that the increase in population in my constituency has stretched the education budget and that cuts in languages and music lessons are proposed. Naturally that is a cause of local concern, as people want the teaching of those subjects to be maintained.

I should like Ministers to say that COSLA's formula is not sacrosanct and that there are ways of reviewing and revising it. Population increases in large rural areas such as my constituency should lead to a review of the 85 per cent. of the settlement that comes from central Government.

This year, for the first time in years, local government will have to stand up and be counted. Local authorities will have to tell the people of Scotland why they cannot maintain service provision although their budgets have increased in real terms. The answer is that certain assumptions and projections were made about the changeover, many of which have now proved to be flawed and to require attention. With that in mind, we have to accept that there will be increases in council tax, but the money should be directed at the services that most concern local people, such as education.

I have a question for my hon. Friend the Minister. As the Government have allocated a certain sum to police budgets, what happens if the local authority joint police boards decide not to spend it all? The police would not get the advantage of the increased funding which the Government want to provide and the public welcome, so what would happen to the money?

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

To save time later, let me answer my hon. Friend. As the police receive a specific grant that is paid against claims from local authorities, if a local authority does not spend the grant, it loses the benefit.

Photo of Mr Bill Walker Mr Bill Walker , North Tayside

I expected that answer, for which I thank my hon. Friend. If the police grant is not demanded or taken up, the police and the local community lose out and the council gains nothing. We should press councils to make the police a priority. People in North Tayside will want to question the two local councils about the attitude that they have adopted.

Opposition Members seem to be looking forward with relish to the general election. They should never count their chickens until they are hatched.

Photo of Mr Eric Clarke Mr Eric Clarke , Midlothian 5:54 pm, 4th March 1997

I am also disappointed by the debate. It is a bit like a poor-oot at a wedding—money which is flung out of the car when the bride leaves. It is a poor-oot in Edinburgh. There is a scramble for the money and if anyone does not grab enough, it is hard luck.

We are talking about people's jobs. Care in the community has become a joke. It has been foisted on to local authorities without the appropriate financial backing. At the end of the day the most vulnerable people suffer: the young, the old and disabled people.

A great deal of anger is directed at councillors in Midlothian. I was a councillor in Midlothian for 16 years and I agree with the right hon. Member for Dumfries (Sir H. Monro). In the days of county councils, councillors stood by the rate. They were elected or not by the rate. We provided facilities within a sensible budget. We did not have central Government dictating to us. I agree that there should be more accountability. When we have a Parliament in Edinburgh we shall work out a more democratic formula for local government.

There has to be proper reform, not the botched up reforms that we have had in the past that killed off and replaced regional authorities. That is the problem in Midlothian. The Minister agreed to meet a delegation from Midlothian and welcomed us in a formal and reasonable way. I cannot criticise him for that, but the result was a different story.

Midlothian made a case for more money, but was told that the formula was worked out along hard lines. We told the Minister that the formula that led to the mismatch and other problems was calculated on an unacceptable basis and he agreed, but when the case reached COSLA's steering committee, Midlothian lost out. The steering committee voted almost unanimously for the formula to continue although we had proved that Midlothian would lose out not just this year, but next year.

What does it mean? I shall read out two questions from Midlothian to the Minister: Is the Minister aware that his settlement means a year on year reduction of £3 Million in the grant paid to Midlothian and that this factor alone means a £115 or 16 per cent. increase in Midlothian's council tax?The formula based assessments have proven to be invalid in that three secondary indicators which remove £2.3 million of grant from Midlothian have failed the statistical test for the second successive year. Is the Minister suggesting that Midlothian Council should cut services to the residents of Midlothian to match up to the indicators which have been proven to be invalid and should have been dropped? Midlothian and other authorities have statutory duties. They cannot walk away from them, so what should they do? They are currently giving notice to all their employees.

Like the hon. Member for North Tayside (Mr. Walker), I get rather angry with people who personalise their politics. I do not personalise mine. I do not make personal attacks; I try to be nice. There comes a time, however, when people have to be told the facts of life.

I get angry when people try to discredit Labour and to say that Labour-controlled local authorities are mismanaged, spendthrift, globe-trotting and all the rest of it—because it is just not true. One cannot argue—[Interruption.] I am talking about the people whom I represent in Midlothian, and I defy the Under-Secretary of State for Scotland to say otherwise. I am talking about Midlothian, and I do not accept that, in one way or another, it is being mismanaged.

Council administrators and employees are very angry. The faulty formula by which councils are being deprived of money is a return to the poor-oot, and that is not good enough. Councils must ultimately face up to the realities. They are soul-searching and tearing out their hearts to try to make ends meet, and they are doing the best that they possibly can.

Councils will have to decide at the end of this week what they can do with the moneys that they have. However, the problem boils down to the fact that they are being shortchanged by the Government. One can say what one likes, but, like everyone else, I know when I am being shortchanged. One can build up the matter, wrap it up in flannel and flowers or describe it in any way one likes, but, ultimately, the people of Midlothian know who are working against them—the Government, who are shortchanging us all. I am arguing the case for Midlothian, but I am sure that, if they have an opportunity in this debate, many other hon. Members will say the same.

I should tell the hon. Member for North Tayside (Mr. Walker) that it is totally unfair to compare his area with ours. I sympathise with those in the big urban areas. Does he know that the population of Wester Hailes, in Edinburgh, is the same as Perth's? Do they have Perth's facilities or amenities?

Photo of Mr Bill Walker Mr Bill Walker , North Tayside

I do not represent Perth.

Photo of Mr Eric Clarke Mr Eric Clarke , Midlothian

I am giving you an example. I am not saying that you represent Perth; I know who represents Perth—the lovely lady up there.

Photo of Miss Janet Fookes Miss Janet Fookes , Plymouth Drake

Order. May I remind the hon. Gentleman always to address the Chair?

Photo of Mr Eric Clarke Mr Eric Clarke , Midlothian

I am very sorry, Madam Deputy Speaker.

One cannot compare Perth with Wester Hailes, or the big urban areas in Glasgow with some of Scotland's lovely rural cities; and it would be unfair to try to do so. Those cities have natural amenities and resources, whereas urban areas—massive areas of concrete jungle—have very little or nothing at all.

Photo of Mr Bill Walker Mr Bill Walker , North Tayside

I trust that the hon. Gentleman would accept that the cost of providing education in rural areas can be much more expensive because of the distances involved and the problems faced. That is one aspect of the matter. As education is a very large part of local government expenditure—[Interruption.]

Photo of Mr Bill Walker Mr Bill Walker , North Tayside

Does the hon. Member for Midlothian (Mr. Clarke) accept that—when one compares what one gets for every pound spent—it is not unreasonable to say that one must take a population increase into account?

Photo of Mr Eric Clarke Mr Eric Clarke , Midlothian

All I am saying is that like-for-like comparisons are very difficult when the circumstances are absolutely different.

Photo of Roseanna Cunningham Roseanna Cunningham , Perth and Kinross

Does the hon. Gentleman agree that the hon. Member for North Tayside (Mr. Walker) has just given a splendid example of why invidious comparisons between England and Scotland are absolutely inappropriate?

Photo of Mr Eric Clarke Mr Eric Clarke , Midlothian

I totally agree. Because of Scotland's sparsely populated areas, with their massive deficits for road maintenance and many other services, it cannot be compared with England.

It is unfair to write off urban areas and merely to say that they are different from the constituency of the hon. Member for North Tayside. Those areas are different, and they have different problems. All I can tell him is that we should be compassionate to one another. It is not a matter of me taking anything away from other areas. In certain circumstances, areas should be given grants and rights. On that basis, I support the city of Glasgow.

Photo of Tommy Graham Tommy Graham , Renfrew West and Inverclyde

Will my hon. Friend give way on that point?

Photo of Mr Eric Clarke Mr Eric Clarke , Midlothian

I have already given way three times, and I know that other hon. Members would like to speak; I am sorry.

If this debate does nothing else, I hope that it will ensure that those listening to it—not only to my speech, but to those of other hon. Members—understand the reality that we are attempting to describe, so that they can see beyond the smokescreen of allegations about inefficiency and globe-trotting, which, intolerably, is being used to shortchange us all.

People are lying awake at night with worry because of the cuts imposed by the Government on local government—because they do not have a job, because their mothers, fathers or other loved ones will not receive proper medical treatment and because their children will not be educated properly.

Photo of Mr Phil Gallie Mr Phil Gallie , Ayr 6:04 pm, 4th March 1997

The hon. Member for Midlothian (Mr. Clarke) speaks as a member of the shadow Front-Bench team and as a Labour Whip, and he has just challenged the entire thrust of Labour's position on local government expenditure. Labour has said, "Not 1p more"; but he says, "The Government are shortchanging Midlothian." I can tell him that the Opposition will shortchange Midlothian in exactly the same way, because they are not offering any more cash.

The hon. Member for Perth and Kinross (Ms Cunningham) intervened on the hon. Member for Midlothian, highlighting the reference by my hon. Friend the Member for North Tayside (Mr. Walker) as to why Scotland receives additional expenditure, and she was quite right. The expenditure differential has been expressed in the Barnet formula. The Government have honoured the formula for many years, and they will continue to do so. By emphasising the problems of rural areas, however, she has not examined the situation in cities and in Scotland's central belt.

One question that must be asked is why Glasgow receives 80 per cent. more aggregate external finance than English cities? Why is there a 42 per cent. greater increase in AEF across Scotland than in similar towns and villages in England? It is a major problem, and it must be dealt with. I suggest that Opposition Members take on board the need to examine how money is being spent in local authorities, and to determine true value for money.

In his pathetic speech, the main criticism made by the hon. Member for Hamilton (Mr. Robertson) was that my right hon. Friend the Secretary of State for Scotland did not open this debate. I should tell Opposition Members that the leader of the Scottish Liberals has not spoken in this debate—nor, I suspect, will the leader of the Scottish National party. Perhaps the difference between hon.

Members in the minor Opposition parties and Labour Members is that they have more faith in their junior shadow spokesmen. Obviously the hon. Member for Hamilton does not have such faith. Perhaps that is why the hon. Member for Dundee, East (Mr. McAllion) is sitting on the Back Benches. I remind the House of the time when he was relegated there. The hon. Member for Hamilton did not even keep him in the picture of Front-Bench thinking. All hon. Members should reflect on that.

My right hon. Friend the Member for Dumfries (Sir H. Monro) spoke about local authorities and about the belief—particularly in Labour-controlled authorities—that the value of controlling one lies in how much one can spend. I can provide an example of that sentiment from my own days on Cunninghame district council. When I challenged Councillor Jim Clements—whose family was steeped in local government—on why he never became involved with community councils, he said: They are worthless. They have no money to spend. I only want to be involved when we have money to spread out and provide services across the community. He never thought for one moment about how that money was earned. That is the difference between Opposition and Conservative Members.

I know that Opposition Members have recently challenged the Government on the health service. We have been told that efficiencies are necessary. I have a letter from the North Ayrshire and Arran trust which challenges the beliefs of Opposition Members. It states: The numbers of nurses and midwives have increased by 4.6 per cent. since April 1993".

Photo of Miss Janet Fookes Miss Janet Fookes , Plymouth Drake

Order. Before the hon. Gentleman goes cantering down that particular road, I remind him that we are debating local government finance.

Photo of Mr Phil Gallie Mr Phil Gallie , Ayr

I fully accept that point, Madam Deputy Speaker. I was attempting to illustrate how wrong Opposition Members are on those issues. They believe that attempts have not been made in other areas, such as the health service, to rationalise and to produce results and wise expenditure levels. Such results have been achieved in the health service, unlike in local government. It is time for local authorities to reanalyse their position. I recognise that I shall have to sit down in the not too distant future to allow other hon. Members to speak, but it is worth giving up several other issues that I wanted to raise to make several causes for thought.

I should like to pick up on one issue in relation to Glasgow. I note that £130,000 has been spent on a glossy magazine to inform people about what the City of Glasgow council sets out to do. I see the hon. Member for Glasgow, Springburn (Mr. Martin) nodding his head and saying that that is great. He obviously approves.

Photo of Mr Phil Gallie Mr Phil Gallie , Ayr

I suspect that the hon. Gentleman approves. He and his hon. Friends have criticised the Government for spending £600,000 on advertising the nursery voucher system. The public need to be advised about the system so that they know how to use it. That is purely an information exercise. If it is good enough for Glasgow to spend £130,000 on a relatively small number of the Scottish people—

Photo of Ms Jean Corston Ms Jean Corston , Bristol East

On a point of order, Madam Deputy Speaker. Has a Minister asked you whether it is possible for him to come to the House to apologise for a statement made during Environment questions this afternoon? I have had telephone calls from my constituents, whose interests I am sure that you wish to protect. The Under-Secretary of State for the Environment, the hon. Member for Croydon, Central (Sir P. Beresford), said that Bristol city councillors were increasing their allowances by 66 per cent. and that they were going to build a flagship building with turrets at a cost of £1 million. Neither of those statements is true—they are both misleading. Is it possible for the Minister to come to the House to set the Hansard record straight today?

Photo of Miss Janet Fookes Miss Janet Fookes , Plymouth Drake

In answer to the hon. Lady's first question, I have received no such notification. As far as the substance of her complaint is concerned, it is not for the Chair to adjudicate on the accuracy of statements made by any hon. Member—Minister or otherwise. The hon. Lady has made her point.

Photo of Mr Phil Gallie Mr Phil Gallie , Ayr

Picking up on that point of order, I should like to talk about councillors' allowances. The number of councillors in Scotland has been reduced in recent times by about one third. We now have 1,245 councillors, of whom 739 receive special allowances. One might think that the level of special allowances would have reduced, but the level of councillors' allowances has gone up from £7.1 million to £13.3 million—the figure has almost doubled. We are told that there is not a lot of money in local authorities. I should have thought that councillors would have considered those special allowances.

The situation in East Ayrshire astounds me. The council has 30 members—almost all of whom are Labour—and 29 special allowances are available to councillors. There is something wrong there. Authorities should consider that issue when complaining about lack of funds.

The independent Peida report, put together with Coopers and Lybrand, shows that planning departments in Scotland cost 60 per cent. to 70 per cent. more than those in England. I accept the comments by the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) that sometimes more detailed analysis is needed. I have considered the planning development department in my area of South Ayrshire. Small shopkeepers who have tried to put up reasonable signs in a way that would enhance town centres have been constantly badgered by planning officials to stick to petty, small-minded rulings. There is something wrong there.

Photo of Mr Archy Kirkwood Mr Archy Kirkwood Liberal Democrat Chief Whip

What has that got to do with it?

Photo of Mr Phil Gallie Mr Phil Gallie , Ayr

Planning departments spend a heck of a lot of local authority money. They are getting involved with petty matters and having a major effect on the expansion of town centres.

At Towans hotel in my constituency, the council insisted on keeping a dilapidated building occupied—it was empty but occupied by an owner. Demolition and redevelopment of the site would obviously have been a better course. The inevitable happened—the building burnt—but the site remains dilapidated. Opposition Members are always shouting about the need for more houses. Additional houses are being missed out on that site.

South Ayrshire council did not seek to operate a pilot project for nursery vouchers. Instead, it has provided its own nursery scheme, building on the number of places available. Will my hon. Friend the Minister tell me whether that means that when cash is allocated for the voucher scheme in the coming year, South Ayrshire council will miss out because there will be a removal of previously funded amounts for nursery schemes provided in local authorities that have nursery places?

I am particularly concerned about community care. I do not understand how local authorities can be providers, competitors for places in nursing homes and residential homes and decision makers on spending plans for community care. My hon. Friends in the Government need to look carefully at that. There is considerable waste in the current workings of community care. The costs of keeping individuals in their homes are not always fully considered. Health costs are totally ignored. We must take that on board. I very much regret that community care funds have not been ring-fenced.

Finally, I have one comment on capping. I have some sympathy with the comments of the hon. Member for Roxburgh and Berwickshire. I pointed out to my hon. Friend the Member for Eastwood (Mr. Stewart) that 65 per cent. of local government funding comes from general taxation. He suggested that the figure was 85 per cent., but the extra 20 per cent. came from the old non-domestic rating element. Irrespective of that fact, local authorities raise only 15 per cent. of local expenditure. Somewhere along the line, there will be a time when the cap should be removed. At that point, local authorities will take responsibility for financial aspects, which would be a jolly good thing.

Photo of Andrew Welsh Andrew Welsh , Angus East 6:17 pm, 4th March 1997

I am disappointed and angry about the way in which the debate has been conducted. The hon. Member for Midlothian (Mr. Clarke) talked about people knowing when they had been short-changed. In many ways, that is what has happened to them. The debate has been reduced to issues such as who has not contributed to the debate and some stuff about whether councillors have gone on foreign trips. We are discussing the most important subject facing the Scottish people. The decisions will affect the essential daily services for every man, woman and child in Scotland. They deserve a better debate.

The debate should have been about the kind of local government system that we all seek, about the level of local government services and about employment. It should also have been about democratic control of local decisions. Instead, public opinion has been ignored and dismissed. The Government have never admitted the consequences of their actions, but the people know who is to blame for cuts in services and employment. The Minister has dwelt on trivia, probably deliberately, rather than on substance.

The truth is that local government is totally controlled by central Government. Some 75 per cent. of its services are determined by central Government, as is 85 per cent. of its revenue. Central Government place capping limits on local government and control its capital spend. Local authorities are not free to take decisions, because they are dominated by central Government decisions. The Government have created the current local government crisis.

We are debating next year's local government finance orders just days before local authorities announce their budgets in the light of what is widely recognised to be the worst local government settlement on record. Throughout Scotland, services are being squeezed, while, at the same time, councils are having to contemplate huge rises in council tax and huge increases in service charges. Even the better-off councils—there are now only a few—are running simply to stand still.

The cash crisis is primarily the result of the accumulated effect of long-term underfunding coupled with the failure of the Scottish Office to meet the costs of reorganisation or provide the resources necessary to meet the new statutory obligations that it has placed on local authorities. Although the Secretary of State continues to build into the settlement assumed savings from reorganisation, his assumptions have been totally discredited by the Chartered Institute of Public Finance and Accountancy study, which remains unchallenged. It found that, since 1995–96, the botched attempt to gerrymander has cost Scottish local government £281 million—almost four times the Scottish Office's estimate. Yet again, the Government's figures have been shown to be pure financial fantasy.

Even the Scottish Office has had to admit that new statutory obligations faced by local authorities, including those under the care in the community policy, the landfill tax, the Children (Scotland) Act 1995 and the Disability Discrimination Act 1995, total more than £90 million. The Government have failed to provide new resources to meet those new obligations. As a result, councils are faced with having to make staggering cuts of about £350 million—even before taking into account the effect of the 75 per cent. housing debt repayment rules, which have so devastated Scottish council housing provision.

The Minister repeated the Tory boast that grant-aided expenditure next year would increase by 2.2 per cent., with a corresponding rise of 1.1 per cent. in grant support. That is a blatant and foolhardy attempt to mask the extent of the cuts. The Minister has failed absolutely to convince anyone. When transfers, new burdens and pay awards are left out and like is compared with like, it becomes clear that grant support is being reduced by 2.1 per cent. in cash terms. His increase is in reality a reduction.

The Secretary of State tried to steal the show at the Scottish Grand Committee with the announcement that he would permit 15 councils, including my own Angus council, to increase their spending levels by £10 million under the capping regime. He was, however, much less up-front about the fact that the capping relaxation was not accompanied by any new resources. So, it is good news for us but bad news for the others. It is a simple case of divide and rule.

The Secretary of State is trying to dictate to local authorities where the money will go, prioritising spending on the police, fire services, education and health without providing any additional resources to match those priorities. To increase spending according to Scottish Office directions while remaining within capping limits, local authorities will have to reduce expenditure on every other service. Those are the actual consequences of the Government's proposals.

Surely it is not for the Secretary of State to decide how local authorities should spend public money. Councillors are not Government appointees on quangos, however much he would wish them to be. I accept that the notion of democratic accountability might seem rather peculiar to the Government. The Scottish National party believes that central Government should work in partnership with local government. Instead, the Tory Government seem determined to demolish local democracy at every turn. When the budgets are announced on Thursday, showing an increase in council tax that is estimated to be about 13 per cent., the Scottish people will know that local authorities are not to blame. The electorate will soon have the opportunity to show their contempt for the Government.

By means of a shameful party political propaganda exercise that cost taxpayers £235,000, the Secretary of State tried to argue that local government in Scotland is favourably treated; yet even the consultants who were commissioned to write the report gave it a health warning, urging "extreme caution" in making comparisons at any level of detail. In fact, when comparing like with like, there may be little difference at all in expenditure between Scotland and England.

Most of the expenditure variation is explained by differences in statutory responsibilities and funding mechanisms. Unique Scottish circumstances, such as its geography, climate and levels of deprivation, also lead to differences in need and the cost of meeting it. Any difference that remains is explained—even in the Coopers and Lybrand report—as the result of local councils' policy priorities. The priority in Scotland has clearly been to provide better services of higher quality than in England and Wales, particularly in education. The cuts imposed by the Government are leading to school closures and compulsory redundancies of teaching staff.

The Government should be ashamed of themselves for using the smokescreen of the per head of population figures to try to prove something that the Coopers and Lybrand report shows is fundamentally a sham. Given the spending of £235,000 on the report and £800,000 on nursery voucher propaganda, it is a great pity that the Secretary of State is not half as willing to defend Scotland's record of better standards as he is to squander public money on shameless Tory propaganda. As well as reflecting councils' policy priorities, the higher standard of service provision must surely also reflect the policy priorities of the Scottish people. In that regard, what the Secretary of State's propaganda report may explain above all else is why there are no longer any Tory councils in Scotland. The money would have been better spent on services.

It is nonsense for the Government to rant about relative spending without considering relative revenue. The Chief Secretary to the Treasury admitted that, when Scotland's share of oil revenues is taken into account along with our share of privatisation proceeds, far from being subsidised, Scotland has paid a massive £27 billion surplus to the London Treasury since 1979. The Government's figures give the lie to the Tory subsidy myth. Over the next five years, a surplus of £12.5 billion will be generated. Why are we talking about cuts when such resources would be available to an independent Scotland?

Regardless of the debate over the reports, the findings of the report of the Planning, Industrial and Economic Development Advisers, which was commissioned by COSLA, highlight the devastating impact of the Government's cuts on the Scottish economy. It is perhaps significant that COSLA used the same consultancy firm as that commissioned by the Scottish Office. Perhaps the Secretary of State should accept the Pieda report, which points out that the cuts about which the Minister avoids talking will result in as many as 17,000 job losses in Scotland and the loss of £315 million from Scottish household incomes. That puts into context the trivia that the Minister has introduced into this debate in trying to avoid the reality. The cuts will be made regardless of the outcome of the debate on comparative expenditure and are a direct result of Government cuts. In a wealthy nation, there can be absolutely no justification for running Scottish local government services into the ground.

As for new, blue Labour, it has made it abundantly clear that it will do nothing to stem the financial crisis—a slap in the face that has sent its own people reeling. I deeply regret the fact that the Labour leadership seems to lack the imagination, integrity and political will to fight for Scotland, and is content instead to allow Scotland to run down while taking orders from its Thatcherite leaders in London. Labour will not escape the judgment of the Scottish people. Opinion polls show that, since the announcement of the Brown bombshell, support for new Labour has fallen dramatically by six points, with the SNP closing the gap.

The SNP has a fully costed commitment to restore services lost in local government cuts. We will provide Scottish local authorities with an extra £1.4 billion over the first four years of an independent Scottish Parliament. Local authorities need neither a seventh cavalry nor a slap in the face. They need a party that is committed to defending Scotland and investing in public services—working in partnership with local government, not against it. Only the SNP can be trusted to achieve those goals, and only independence will allow Scotland access to its wealth to secure the future of local government and to maintain its high standards of local services. I look forward to that day.

Photo of John McAllion John McAllion , Dundee East 6:29 pm, 4th March 1997

I can tell the hon. Member for Angus, East (Mr. Welsh) that to describe me as new or blue is a distortion of the facts, and I think most hon. Members would accept that. I was surprised that the Minister began the debate by referring to the opinion poll in The Herald today. That poll showed Labour leading its nearest rivals in Scotland by 20 per cent. Even worse for the Tories, our nearest rivals are the SNP—not the Tories, who are even further behind in Scotland than in England.

The Minister also ran the danger of drawing hon. Members' attention to the other poll in The Herald in which readers were invited to vote for a fantasy Cabinet in a Scottish Parliament. The Secretary of State for Scotland is one of the most hated figures in Scotland, but he has a positive rating of eight. The Minister has a negative rating of minus five, so it was a mistake for him to begin his speech by referring to those polls.

The Minister also said that his claim—that every council in Scotland will be able to increase expenditure this year—bore repeating. Indeed, he claimed that councils in Scotland would get an additional £140 million—including some £60 million directly from the Government—or an increase of 2.2 per cent. That claim bears repeating only to show that the Minister is a barefaced manipulator of the facts. It makes no allowance for the fact that the capping limits, imposed by the Government, allow for an increase of £75 million, not £140 million. That is an increase of 1.2 per cent., or half the rate of inflation.

The claim also makes no allowance for the pay awards that are agreed nationally between councils and trade unions and that councils are expected to implement. The settlement does not contain a single penny for those pay awards. It also does not make allowances for the new burdens that have been placed on local authorities, to which many hon. Members have already referred. The Scottish Office claimed that the cost of those burdens would be £90 million, but the settlement does not contain a penny to cover that cost.

Far from taking account of the costs of local government reorganisation and its impact on councils such as Dundee, the Government assume savings for local government from the reorganisation, but those savings do not exist. The Minister's claim was bogus and shows once again that the people of Scotland, and everyone else, cannot trust the Tories' claims.

The Minister also spoke of his trips abroad and tried to justify his trip to Korea by saying that he had brought back more than 4,000 jobs through the Chunghwa investment in Lanarkshire. What arrogance for that insignificant figure on the Front Bench to assume that a multinational company would make a major inward investment decision because he happened to visit there. The arrogance of the man is breathtaking. Nobody in Scotland believes for a minute that he is responsible for inward investment in Lanarkshire or anywhere else.

The Minister is personally responsible for jobs in Scotland through the current local government financial settlement and the one that we are debating tonight. Those financial settlements will mean the loss of 17,000 jobs across Scotland in local government. The Minister may dismiss those jobs as not real if he thinks that we do not need people who look after the elderly, home helps, teachers or people who work in family and child centres. Even if we accept his boast about the 4,000-plus jobs he has provided, he is still responsible for a net loss of 13,000 jobs. I wonder if he will apologise to the people of Scotland for his disgraceful record.

Photo of John McAllion John McAllion , Dundee East

He is not listening because he prefers debates in which only he and his hon. Friends speak. The debate has lasted three hours, and an hour and a half has been taken up by Tories who have kept Labour Members out because they do not want to face reality. They want to cower and hide in the Chamber because they are frightened to face the people in a general election. They are hanging on by their fingernails until the last possible moment, hoping that we will blow it and their bacon will be saved. It will not happen and everybody in Scotland is waiting for the moment when they can pay back all the Tory Ministers and Tory Back Benchers for the misery of the past 18 years.

Another example of the Minister's distortion of the truth was when he said that it was fascinating that COSLA intended an increase in spending of £500 million. The actual figure calculated by COSLA was £414 million. COSLA also admitted that, even if it used tricks such as phasing and delaying implementation—and other devices that it has learnt over the years to try to cushion Tory cuts—the increase is only £180 million, or less than half the figure that the Minister proclaimed. The Minister cannot be trusted. I cannot say what he is, because of the arcane rules of the House, but everybody in Scotland knows what he is. If he repeats any of his statements outside, he will be accused of being a barefaced—I cannot say what he is.

The Minister referred to his meeting with Glasgow city council and he said, in another example of the way in which he twists and manipulates everything, that the council was effectively asking for other councils to get less so it could get more. The key word is "effectively". I know that Glasgow city council asked for no such thing, but the Minister pretends that it did.

I accompanied a delegation from Dundee city council when it met the Minister. The delegation included councillors and people from local authority trade unions, the churches and voluntary organisations. It also included people from Dundee and Tayside chamber of commerce—who are normally on the Government's side, but who were on Dundee's side that time. We patiently explained the cuts that had been implemented in Dundee as a result of the financial settlement. We described the closure of six primary and two secondary schools. I remember a television debate in which the Minister said that there was no reason to close any school in Scotland because of the financial settlement. Eight schools have been closed in my area and many other schools have been closed, but the Minister has never withdrawn that statement.

Dundee has also seen a 37.5 per cent. increase in school meals charges in the past two years. Rich people can afford that increase. Another 30p or 40p from their purse makes little difference, and their kids will still get decent school meals. Poor people, who are just above the income support level, cannot afford that increase, and it could mean that their kids do not get a school meal. We hear no apologies from Tories for that. Staffing levels in schools have also been reduced. We are told that education is a priority, but the financial settlement means the loss of 50 teachers in Dundee.

Dundee has also had to start charging for home helps. My hon. Friend the Member for Glasgow, Springburn (Mr. Martin) mentioned home helps in Springburn. My mother was a home help in Springburn and I know the great work that home helps do. Previously, their services were free in Dundee, but we have had to start charging, and that means that old folk cannot afford them. Cuts have been made in voluntary organisations and concessionary travel schemes—the list goes on. The council tax increases that go with the cuts are even more savage. Morally, ethically, socially and economically, the financial settlement is unacceptable, and no hon. Member who genuinely has the interests of his constituents at heart could argue for it.

We explained all that to the Minister at the meeting. Everyone agreed that he was not interested. Only twice did he show a spark of interest in what anyone said. The first time was when he thought that someone had said that other services in the Scottish Office bloc should be cut to pay for extra funding for local government: he immediately came to life and asked what other services should be cut. The second time was when he thought that someone had said that other councils should get less so that Dundee could get more: again, he became very excited and pleased.

Those are the same old Tory tactics of divide and rule, turning council against council and service against service, while insisting that public services have to be reduced and that the poor people who depend on them must pay the price because the kind of people who vote Tory can buy privately and do not have to depend on the councils. That is the hidden agenda.

The Minister issued a challenge to us to say what other services should be cut in the Scottish Office bloc. That bloc is between £14 billion and £15 billion—an awful lot of money—but its level is decided by the Cabinet, not from on high by God; it is not irreversible, and the Cabinet can decide what formula should be applied and how much money is needed. If the Secretary of State cannot win a better deal for Scotland, he should not be the Secretary of State for Scotland: someone else should be in his place.

Let us stop arguing about bogus points in this bogus forum. Let us go to the country and let the people decide who can best be trusted.

Photo of Malcolm Chisholm Malcolm Chisholm , Edinburgh Leith 6:40 pm, 4th March 1997

Once again, we have seen the Government playing politics with local government in the vain hope that Labour councils, or even Opposition Front Benchers, will get the blame. I remind them gently that they have been in charge for 18 years and that this local government settlement, the worst for more than 20 years, is the final monument to 18 years of low growth, boom-bust instability and economic failure.

The terms of the debate were set by the Minister, in 46 minutes of obfuscation, fiddles, smokescreen and absurdity. There are two facts that he cannot avoid. First, the job losses and service cuts that he described, in a climax of absurdity, as imaginary, are felt by people throughout Scotland: both those who have suffered this year—6,709 job losses, according to the Pieda report—and those who will be affected by the further job losses and service cuts that will be forced on local councils this week. Secondly, the people in Scotland now understand full well that the Secretary of State controls the service levels via capping and the council tax increases via grant distribution.

There are two ways of comparing this year's Government grant with next year's: in cash terms or in real terms. The simple way is to compare in straight cash terms. Whichever way we look at it, there has been a cash cut for next year compared with this year: the Red Book put it at £50 million, because of estimated outturn; the public expenditure statement in December put it at £25 million; and, even if we strip out the police loan charges and the urban programme specific grant, it is £17 million.

There has certainly been a cash cut, but the Minister talks of a £60 million increase in Government grant. The only way to arrive at that figure is by the imaginary savings from local government reorganisation that nobody who has studied the subject believes in. The reality is that, as the Chartered Institute of Public Finance and Accountancy report pointed out, local government reorganisation has cost council tax payers in Scotland £281 million, and they are still paying a reorganisation surcharge in their bills for this year and next year.

The Minister asserted that the amount that can be spent on services will increase next year by 2.2 per cent. Again, the figures can be compared in cash terms or in real terms. In cash terms, the increase is 0.8 per cent., but in real terms we must take account of the new burdens that will be faced by local government next year, and even the Government admit that those burdens will amount to £90 million.

The Government like to talk about disappearing old burdens, such as the £26 million in nursery vouchers, but it is totally illogical to talk about that without balancing against it the £90 million of new burdens that even the Government admit to; the large cut in cash terms becomes a massive cut when we take new burdens into account.

I am glad that the Minister has stopped all the nonsense about uncollected poll tax and council tax that he was going on about a few weeks ago to try to muddy the waters, although he clearly did not understand the Government's rules about such uncollected tax. The reality is that single-tier local government in Scotland is called the Secretary of State for Scotland: he determines the service and grant levels.

That, of course, will change after the general election. One of our main reasons for wanting a Scottish Parliament is so that such decisions can be taken in an open, democratic manner, rather than by one person in the Scottish Office. [Interruption.]

The Under-Secretary, the hon. Member for Aberdeen, South (Mr. Robertson), is fond of sedentary interventions. Throughout the Minister's speech, he kept shouting at the Opposition Front Bench and telling us that we should raise taxes; he was obviously upset about the fact that the Labour party has no intention of raising taxes. Unlike the Tory party, which raised expectations before the general election and taxes after, we are in the business of telling the truth before the general election, and only one tax after: the windfall tax.

Photo of Malcolm Chisholm Malcolm Chisholm , Edinburgh Leith

Wrong again. We shall raise the windfall tax, to deal with youth unemployment, which will be our priority when we come into government.

We shall have to attend to the building blocks of economic success as a priority after the election, because the underlying cause of the grant cuts and the crisis in local government is the Government's economic failure. We also plan in the first year of a Labour Government to deal with the problem of waste and to examine priorities. My right hon. Friend the leader of the Labour party has said that his priorities are education, education and education. That is good news for local government, as my hon. Friend the Member for Hamilton (Mr. Robertson) pointed out.

Once again, Ministers have tried to act as if we were the Government and they the Opposition. That will soon be the case, but they are still the Government tonight and all their attempts to blame somebody else for their failures will not be believed by the people of Scotland. Anyone who had managed to sit through the Minister's 46 minutes would not have been persuaded by any of his arguments. His tactic was to try to confuse by putting up smokescreens and descending into absurdity. This will be the last local government settlement from this Government. If tonight's performance by the Minister is anything to go by, it is certainly time for a change of tack.

My main fire has been directed at the Government, who are responsible for the settlement, but I should point out that the hon. Member for Angus, East (Mr. Welsh) was equally in a world of fantasy. He and his party made all kinds of promises about what they would do for local government, centring on the claim that they would put £1.4 billion into local government to deal with the crisis, but that is not a credible option and the people of Scotland will not believe it. The Scottish National party makes many spending promises, but never tells us where the money will come from. Labour is the party with a credible alternative.

Photo of Andrew Welsh Andrew Welsh , Angus East

The hon. Gentleman cannot get away with that, and he will find exactly where the money is coming from if he cares to look at our detailed documents—something that his party has never produced. He offers Scottish local authorities no improvement, because he is dealing with a Scottish Office budget. We are promoting a Scottish national budget, and there is a massive difference between the two.

Photo of Malcolm Chisholm Malcolm Chisholm , Edinburgh Leith

My hon. Friend the Member for Monklands, East (Mrs. Liddell) referred to Santa Claus when the hon. Gentleman was speaking. The hon. Member for Perth and Kinross (Ms Cunningham) referred to the planet Zog the other night, and that is where the Scottish National party belongs, with its plans to magic away debt, its conjuring up of massive surpluses by the loading of one parliamentary question, the way in which it made Scotland leap up the international prosperity table from 22nd to eighth in two months and its confetti spending pledges that it scatters with no tax costs.

That point has to be made, because the real choice before the Scottish people at the next election is between the Government and the Labour party. Labour is the only party that can get rid of the Government and is the only party with credible alternatives to deal with the economic and local government crises that 18 years of Conservative government have delivered to Scotland.

Photo of Mr John Maxton Mr John Maxton , Glasgow Cathcart

On a point of order, Mr. Deputy Speaker. The Under-Secretary of State for Scotland has had 46 minutes in the debate already. May I ask why the Secretary of State, who is his boss and is sitting next to him, is not answering the debate? If he is too frightened to reply, perhaps the Under-Secretary of State for Scotland, the hon. Member for Aberdeen, South (Mr. Robertson)—

Photo of Mr Geoffrey Lofthouse Mr Geoffrey Lofthouse , Pontefract and Castleford

Order. I have called the Minister and it is a matter for him to reply if he so wishes.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside 6:50 pm, 4th March 1997

We have had the usual local government debate, as I described in my introduction. All Opposition Members have used their usual ploy of calling for more funding and saying that local government is suffering cuts. Thankfully, that is not the case, and we have given extra funding to local government. Of course, that is not our money, but taxpayers' money—something the Labour party always seems to forget.

I am grateful to my right hon. Friend the Member for Dumfries (Sir H. Monro), and to my hon. Friends the Members for Eastwood (Mr. Stewart), for North Tayside (Mr. Walker) and for Ayr (Mr. Gallie), who made rational and realistic speeches. My right hon. Friend the Member for Dumfries and my hon. Friend the Member for North Tayside referred to a review of grant-aided expenditure formulae with particular reference to rural areas. I can tell them that, with COSLA, we are carrying out a review of GAE formulae, but there has been agreement on both sides that it will be appropriate to do that only once proper financial information is available from the new local authorities. It is quite clear that many authorities have taken a long time this year to make financial information available, so that councils and councillors know what is going on in their areas.

My right hon. Friend the Member for Dumfries referred to the business rate and welcomed the fact that we had introduced the uniform business rate, which he rightly recognised has ensured that businesses north and south of the border can compete on a level playing field. In addition, we have ensured that business rates are frozen for businesses with a rateable value of less than £10,000. The Finance Bill proposes benefits for villages and village shops, and we believe that we are looking after small businesses.

My hon. Friend the Member for Eastwood referred to the hon. Member for Glasgow, Maryhill (Mrs. Fyfe), who said that the people of Bearsden and Kelvinside were all parasites feeding off Glasgow.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

I will let the hon. Lady correct the remark.

Photo of Mrs Maria Fyfe Mrs Maria Fyfe , Glasgow Maryhill

I asked the hon. Member for Eastwood (Mr. Stewart) in a civil manner—and would appreciate a civil reply—whether he had calculated by how much the people of Eastwood benefit from services provided by Glasgow for which they do not pay.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

I am delighted to hear the hon. Lady rephrase that. [Interruption.] The hon. Member for Glasgow, Springburn (Mr. Martin) is shouting from a sedentary position.

Photo of Mr Brian Wilson Mr Brian Wilson , Cunninghame North

On a point of order, Mr. Deputy Speaker. The Minister has attributed to my hon. Friend the Member for Glasgow, Maryhill (Mrs. Fyfe) the word "parasite". That is clearly untrue, and I hope that even this Minister might have the decency to withdraw that remark under your guidance.

Photo of Mr Geoffrey Lofthouse Mr Geoffrey Lofthouse , Pontefract and Castleford

I heard nothing of that nature. [Interruption.] Order. It is a matter for the Minister if he feels that he ought to withdraw the remark.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

If I referred to anything that the hon. Lady did not actually say, I apologise.

Photo of Mrs Maria Fyfe Mrs Maria Fyfe , Glasgow Maryhill

On a point of order, Mr. Deputy Speaker. Just for clarification, I did not utter the word "parasite", so the Minister is wrong to attribute the word to me.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

As I have just said, if I said anything that the hon. Lady did not say, I apologise and withdraw that statement. The hon. Member for Cunninghame, North (Mr. Wilson) has significant cheek in coming to the House at the tail end of the debate and with no intention of contributing to it, but—in his usual manner—raising irrelevant points of order.

Photo of Mr Brian Wilson Mr Brian Wilson , Cunninghame North

On a point of order, Mr. Deputy Speaker. As I have just achieved the rare feat of drawing an apology from a Tory Minister, it was well worth coming in at any stage of the debate.

Photo of Mr Geoffrey Lofthouse Mr Geoffrey Lofthouse , Pontefract and Castleford

Order. That is not a point of order for the Chair. The House must settle down.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

I should like to continue in a positive vein. My hon. Friend the Member for Eastwood referred obliquely—as did the hon. Members for Maryhill and for Springburn—to the fact that people around Glasgow use facilities in Glasgow. As I explained to the hon. Members for Springburn and for Maryhill, the GAE formulae take account of commuter traffic and people visiting from outside Glasgow. However, there is no doubt that that matter will be looked at in the general review of GAE.

I can tell hon. Members who represent urban areas that I get as many complaints from hon. Members representing rural areas, and my right hon. Friend the Member for Dumfries and my hon. Friend the Member for North Tayside complained that the GAE formulae do not benefit rural areas. I saw that the hon. Member for Argyll and Bute (Mrs. Michie) agreed with what they were saying, which shows that the same views are held on either side of the fence.

My hon. Friend the Member for North Tayside also referred to increasing school numbers and their effect on the formulae for education GAE. I responded to that this year, by urging the distribution committee of COSLA and the Scottish Office to look at updating the information on school rolls within the GAE formulae. I am delighted to say that this year the most up-to-date information will be used, which is the school roll as at September this year. The formulae now take account of rising school numbers.

My hon. Friend the Member for Ayr referred to nursery vouchers and said that Labour wants to snatch away those vouchers, which give choice to parents. Vouchers provide £1,100 of opportunity to choose where nursery education is obtained, and I do not think that parents—certainly not the parents in my constituency—will approve of what the Labour party wants to do. I am certain from the comments of my hon. Friend the Member for Eastwood that his experiences prove that point clearly.

In his introductory remarks—which, incidentally, were heard by only 13 of the 49 Labour Members of Parliament who represent Scotland—the hon. Member for Hamilton (Mr. Robertson) clearly referred to the fact that this was a poor settlement. He talked about new burdens, removing compulsory competitive tendering and an independent review of the relationship between central and local government. But the key question that he did not answer was: if he is so critical of the settlement, what funding would he give if he was in power?

Photo of Michael Martin Michael Martin Chair, Administration Committee

The funding is the Government's responsibility.

Photo of Mr George Kynoch Mr George Kynoch , Kincardine and Deeside

It is a responsibility that we delight in taking. We believe that we should be the trustees of the taxpayer and that we should give a sensible and reasonable settlement to local government. That we believe we have done.

We heard a remarkable admission from the hon. Member for Dundee, East (Mr. McAllion), who said that if my right hon. Friend the Secretary of State for Scotland could not get a better settlement, he should not be Secretary of State for Scotland. What the hon. Member for Dundee, East said, in effect, was that the hon. Member for Hamilton is not fit to be Secretary of State, because he has said that he does not intend to provide more money to local government.

There was much scaremongering about cuts in the debate. Reference was made to the fact that notice has been given to employees, but councils have said that they were issued simply to cover legal liability. That does not mean that any posts will be cut.

I was disappointed that the hon. Member for Roxburgh and Berwickshire (Mr. Kirkwood) did not recognise that my right hon. Friend the Secretary of State and I responded positively to his request to ease capping limits for low-spending councils. He got almost an extra £1 million of spending power, which at least his convenor, Mr. Andrew Tulley, recognised was welcome.

In the debate, Conservative Members clearly laid out the ground rules. We have given a sensible and reasonable settlement to local government in Scotland. We have had nothing but the usual annual criticism from the Opposition. Their only solution is a tax-raising Scottish Parliament. Where will the £78 million for that come from?

It being Seven o'clock, MR. DEPUTY SPEAKER put the Question, pursuant to Order [28 February].

The House divided: Ayes 303, Noes 256.

Division No. 87][7 pm
AYES
Ainsworth, Peter (E Surrey)Baker, Rt Hon Kenneth (Mole V)
Aitken, Rt Hon JonathanBaldry, Tony
Alexander, RichardBanks, Matthew (Southport)
Alison, Rt Hon Michael (Selby)Banks, Robert (Harrogate)
Allason, Rupert (Torbay)Bates, Michael
Amess, DavidBatiste, Spencer
Ancram, Rt Hon MichaelBeggs, Roy
Arbuthnot, JamesBellingham, Henry
Arnold, Jacques (Gravesham)Bendall, Vivian
Arnold, Sir Thomas (Hazel G)Beresford, Sir Paul
Ashby, DavidBiffen, Rt Hon John
Aspinwall, JackBody, Sir Richard
Atkins, Rt Hon RobertBooth, Hartley
Atkinson, Peter (Hexham)Boswell, Tim
Bottomley, Peter (Eltham)Fry, Sir Peter
Bottomley, Rt Hon Mrs VirginiaGale, Roger
Bowden, Sir AndrewGallie, Phil
Bowis, JohnGardiner, Sir George
Boyson, Rt Hon Sir RhodesGarel-Jones, Rt Hon Tristan
Brandreth, GylesGarnier, Edward
Brazier, JulianGill, Christopher
Bright, Sir GrahamGillan, Mrs Cheryl
Brooke, Rt Hon PeterGoodlad, Rt Hon Alastair
Brown, Michael (Brigg Cl'thorpes)Goodson-Wickes, Dr Charles
Browning, Mrs AngelaGorman, Mrs Teresa
Bruce, Ian (S Dorset)Gorst, Sir John
Budgen, NicholasGrant, Sir Anthony (SW Cambs)
Burns, SimonGreenway, Harry (Ealing N)
Burt, AlistairGreenway, John (Ryedale)
Butcher, JohnGriffiths, Peter (Portsmouth N)
Butler, PeterGrylls, Sir Michael
Butterfill, JohnGummer, Rt Hon John
Carlisle, John (Luton N)Hague, Rt Hon William
Carlisle, Sir Kenneth (Linc'n)Hamilton, Rt Hon Sir Archibald
Carrington, MatthewHamilton, Neil (Tatton)
Carttiss, MichaelHampson, Dr Keith
Cash, WilliamHanley, Rt Hon Jeremy
Channon, Rt Hon PaulHannam, Sir John
Chapman, Sir SydneyHargreaves, Andrew
Churchill, MrHarris, David
Clappison, JamesHaselhurst, Sir Alan
Clark, Dr Michael (Rochf'd)Hawkins, Nick
Clarke, Rt Hon KennethHawksley, Warren
(Rushcliffe)Hayes, Jerry
Clifton-Brown, GeoffreyHeald, Oliver
Colvin, MichaelHeath, Rt Hon Sir Edward
Congdon, DavidHendry, Charles
Conway, DerekHeseltine, Rt Hon Michael
Coombs, Anthony (Wyre F)Hicks, Sir Robert
Coombs, Simon (Swindon)Higgins, Rt Hon Sir Terence
Cope, Rt Hon Sir JohnHill, Sir James (Southampton Test)
Cormack, Sir PatrickHogg, Rt Hon Douglas (Grantham)
Couchman, JamesHoram, John
Cran, JamesHordern, Rt Hon Sir Peter
Currie, Mrs EdwinaHowell, Rt Hon David (Guildf'd)
Curry, Rt Hon DavidHowell, Sir Ralph (N Norfolk)
Davies, Quentin (Stamf'd)Hughes, Robert G (Harrow W)
Davis, Rt Hon David (Boothferry)Hunt, Rt Hon David (Wirral W)
Day, StephenHunt, Sir John (Ravensb'ne)
Deva, Nirj JosephHunter, Andrew
Devlin, TimHurd, Rt Hon Douglas
Dicks, TerryJack, Rt Hon Michael
Dorrell, Rt Hon StephenJenkin, Bernard (Colchester N)
Douglas-Hamilton,Jessel, Toby
Rt Hon Lord JamesJohnson Smith,
Dover, DenRt Hon Sir Geoffrey
Duncan, AlanJones, Gwilym (Cardiff N)
Duncan Smith, IainJones, Robert B (W Herts)
Dunn, BobKellett-Bowman, Dame Elaine
Durant, Sir AnthonyKey, Robert
Dykes, HughKing, Rt Hon Tom
Elletson, HaroldKirkhope, Timothy
Evans, David (Welwyn Hatf'ld)Knapman, Roger
Evans, Jonathan (Brecon)Knight, Mrs Angela (Erewash)
Evans, Nigel (Ribble V)Knight, Rt Hon Greg (Derby N)
Evans, Roger (Monmouth)Knight, Dame Jill (Edgbaston)
Evennett, DavidKnox, Sir David
Faber, DavidKynoch, George
Fabricant, MichaelLait, Mrs Jacqui
Fenner, Dame PeggyLang, Rt Hon Ian
Field, Barry (Isle of Wight)Lawrence, Sir Ivan
Fishburn, DudleyLegg, Barry
Forman, NigelLeigh, Edward
Forsyth, Rt Hon Michael (Stirling)Lennox-Boyd, Sir Mark
Forth, Rt Hon EricLester, Sir Jim (Broxtowe)
Fowler, Rt Hon Sir NormanLidington, David
Fox, Dr Liam (Woodspring)Lilley, Rt Hon Peter
Fox, Rt Hon Sir Marcus (Shipley)Lloyd, Rt Hon Sir Peter (Fareham)
Freeman, Rt Hon RogerLord, Michael
French, DouglasLuff, Peter
Lyell, Rt Hon Sir NicholasShepherd, Sir Colin (Heref'd)
MacGregor, Rt Hon JohnShepherd, Richard (Aldridge)
MacKay, AndrewShersby, Sir Michael
Maclean, Rt Hon DavidSims, Sir Roger
McLoughlin, PatrickSkeet, Sir Trevor
McNair-Wilson, Sir PatrickSmith, Tim (Beaconsf'ld)
Madel, Sir DavidSoames, Nicholas
Maitland, Lady OlgaSpencer, Sir Derek
Malone, GeraldSpicer, Sir Jim (W Dorset)
Mans, KeithSpicer, Sir Michael (S Worcs)
Marland, PaulSpink, Dr Robert
Marlow, TonySpring, Richard
Marshall, John (Hendon S)Sproat, Iain
Marshall, Sir Michael (Arundel)Squire, Robin (Hornchurch)
Martin, David (Portsmouth S)Stanley, Rt Hon Sir John
Mates, MichaelSteen, Anthony
Mawhinney, Rt Hon Dr BrianStephen, Michael
Mayhew, Rt Hon Sir PatrickStern, Michael
Mellor, Rt Hon DavidStewart, Allan
Merchant, PiersStreeter, Gary
Mitchell, Andrew (Gedling)Sumberg, David
Mitchell, Sir David (NW Hants)Sweeney, Walter
Moate, Sir RogerTapsell, Sir Peter
Molyneaux, Rt Hon Sir JamesTaylor, Ian (Esher)
Monro, Rt Hon Sir HectorTaylor, John M (Solihull)
Moss, MalcolmTaylor, Sir Teddy
Needham, Rt Hon RichardTemple-Morris, Peter
Nelson, AnthonyThomason, Roy
Neubert, Sir MichaelThompson, Sir Donald (Calder V)
Newton, Rt Hon TonyThompson, Patrick (Norwich N)
Nicholls, PatrickThornton, Sir Malcolm
Nicholson, David (Taunton)Townend, John (Bridlington)
Norris, SteveTownsend, Sir Cyril (Bexl'yh'th)
Onslow, Rt Hon Sir CranleyTracey, Richard
Oppenheim, PhillipTredinnick, David
Ottaway, RichardTrend, Michael
Page, RichardTrotter, Neville
Paice, JamesTwinn, Dr Ian
Patnick, Sir IrvineVaughan, Sir Gerard
Patten, Rt Hon JohnViggers, Peter
Pattie, Rt Hon Sir GeoffreyWaldegrave, Rt Hon William
Pawsey, JamesWalden, George
Peacock, Mrs ElizabethWalker, Bill (N Tayside)
Pickles, EricWaller, Gary
Porter, DavidWard, John
Portillo, Rt Hon MichaelWardle, Charles (Bexhill)
Powell, William (Corby)Waterson, Nigel
Rathbone, TimWatts, John
Redwood, Rt Hon JohnWheeler, Rt Hon Sir John
Renton, Rt Hon TimWhitney, Sir Raymond
Richards, RodWhittingdale, John
Riddick, GrahamWiddecombe, Rt Hon Miss Ann
Rifkind, Rt Hon MalcolmWiggin, Sir Jerry
Robathan, AndrewWilkinson, John
Robertson, Raymond S (Ab'd'n S)Willetts, David
Roe, Mrs MarionWinterton, Mrs Ann (Congleton)
Rowe, AndrewWinterton, Nicholas (Macclesf'ld)
Rumbold, Rt Hon Dame AngelaWolfson, Mark
Ryder, Rt Hon RichardWood, Timothy
Sackville, TomYeo, Tim
Sainsbury, Rt Hon Sir TimothyYoung, Rt Hon Sir George
Scott, Rt Hon Sir Nicholas
Shaw, David (Dover)Tellers for the Ayes:
Shaw, Sir Giles (Pudsey)Mr. Bowen Wells and Mr. Sebastian Coe.
Shephard, Rt Hon Mrs Gillian
NOES
Abbott, Ms DianeAustin-Walker, John
Adams, Mrs IreneBanks, Tony (Newham NW)
Ainger, NickBarnes, Harry
Ainsworth, Robert (Cov'try NE)Barron, Kevin
Allen, GrahamBattle, John
Anderson, Donald (Swansea E)Bayley, Hugh
Armstrong, Ms HilaryBell, Stuart
Ashdown, Rt Hon PaddyBenn, Rt Hon Tony
Ashton, JosephBennett, Andrew F
Bermingham, GeraldGolding, Mrs Llin
Berry, RogerGraham, Thomas
Betts, CliveGrant, Bernie (Tottenham)
Blair, Rt Hon TonyGriffiths, Nigel (Edinburgh S)
Blunkett, DavidGriffiths, Win (Bridgend)
Boateng, PaulGrocott, Bruce
Bray, Dr JeremyGunnell, John
Brown, Nicholas (Newcastle E)Hain, Peter
Burden, RichardHall, Mike
Byers, StephenHanson, David
Caborn, RichardHattersley, Rt Hon Roy
Callaghan, JimHenderson, Doug
Campbell, Mrs Anne (C'bridge)Heppell, John
Campbell, Menzies (Fife NE)Hill, Keith (Streatham)
Campbell, Ronnie (Blyth V)Hinchliffe, David
Campbell-Savours, D NHodge, Ms Margaret
Canavan, DennisHoey, Kate
Cann, JamieHogg, Norman (Cumbernauld)
Chapman, James (Wirral S)Home Robertson, John
Chidgey, DavidHood, Jimmy
Chisholm, MalcolmHoon, Geoffrey
Clapham, MichaelHowarth, George (Knowsley N)
Clark, Dr David (S Shields)Howells, Dr Kim
Clarke, Eric (Midlothian)Hoyle, Doug
Clarke, Tom (Monklands W)Hughes, Kevin (Doncaster N)
Clelland, DavidHughes, Robert (Ab'd'n N)
Clwyd, Mrs AnnHughes, Roy (Newport E)
Coffey, Ms AnnHughes, Simon (Southwark)
Cohen, HarryHutton, John
Connarty, MichaelIllsley, Eric
Cook, Frank (Stockton N)Ingram, Adam
Cook, Rt Hon Robin (Livingston)Jackson, Ms Glenda (Hampst'd)
Corbett, RobinJackson, Mrs Helen (Hillsborough)
Corbyn, JeremyJamieson, David
Corston, Ms JeanJanner, Greville
Cousins, JimJenkins, Brian D (SE Staffs)
Cunliffe, LawrenceJones, Barry (Alyn & D'side)
Cunningham, Jim (Cov'try SE)Jones, Jon Owen (Cardiff C)
Cunningham, Rt Hon Dr JohnJones, Dr Lynne
Cunningham, Ms Roseanna(B'ham Selly Oak)
(Perth Kinross)Jones, Martyn (Clwyd SW)
Dafis, CynogJones, Nigel (Cheltenham)
Darling, AlistairJowell, Ms Tessa
Davidson, IanKeen, Alan
Davies, Bryan (Oldham C)Kennedy, Mrs Jane (Broadgreen)
Davies, Chris (Littleborough)Khabra, Piara S
Davies, Ron (Caerphilly)Kilfoyle, Peter
Davis, Terry (B'ham Hodge H)Kirkwood, Archy
Denham, JohnLestor, Miss Joan (Eccles)
Dewar, Rt Hon DonaldLewis, Terry
Dixon, Rt Hon DonLiddell, Mrs Helen
Donohoe, Brian HLitherland, Robert
Dowd, JimLivingstone, Ken
Dunwoody, Mrs GwynethLloyd, Tony (Stretf'd)
Eagle, Ms AngelaLlwyd, Elfyn
Eastham, KenLoyden, Eddie
Ennis, JeffLynne, Ms Liz
Etherington, BillMcAllion, John
Evans, John (St Helens N)McAvoy, Thomas
Ewing, Mrs MargaretMcCartney, Ian (Makerf'ld)
Fatchett, DerekMacdonald, Calum
Faulds, AndrewMcFall, John
Field, Frank (Birkenhead)McKelvey, William
Fisher, MarkMaclennan, Robert
Flynn, PaulMcNamara, Kevin
Foster, Don (Bath)MacShane, Denis
Fraser, JohnMcWilliam, John
Fyfe, Mrs MariaMaddock, Mrs Diana
Galloway, GeorgeMahon, Mrs Alice
Gapes, MikeMandelson, Peter
Garrett, JohnMarshall, David (Shettleston)
George, BruceMartin, Michael J (Springburn)
Gerrard, NeilMartlew, Eric
Gilbert, Rt Hon Dr JohnMaxton, John
Godman, Dr Norman AMeacher, Michael
Godsiff, RogerMeale, Alan
Michael, AlunSalmond, Alex
Michie, Bill (Shef'ld Heeley)Sedgemore, Brian
Michie, Mrs Ray (Argyll Bute)Sheerman, Barry
Milburn, AlanSimpson, Alan
Miller, AndrewSkinner, Dennis
Mitchell, Austin (Gt Grimsby)Smith, Andrew (Oxford E)
Moonie, Dr LewisSmith, Chris (Islington S)
Morgan, RhodriSmith, Llew (Blaenau Gwent)
Morley, ElliotSnape, Peter
Morris, Rt Hon Alfred (Wy'nshawe)Soley, Clive
Morris, Ms Estelle (B'ham Yardley)Spearing, Nigel
Mowlam, Ms MarjorieSpellar, John
Mudie, GeorgeSquire, Ms Rachel
Mullin, Chris(Dunfermline W)
Murphy, PaulSteinberg, Gerry
Oakes, Rt Hon GordonStevenson, George
O'Brien, Mike (N Warks)Stott, Roger
O'Brien, William (Normanton)Strang, Dr Gavin
Olner, BillStraw, Jack
O'Neill, MartinSutcliffe, Gerry
Orme, Rt Hon StanleyTaylor, Mrs Ann (Dewsbury)
Pendry, TomTaylor, Matthew (Truro)
Pickthall, ColinThurnham, Peter
Pike, Peter LTimms, Stephen
Pope, GregTouhig, Don
Pope, GregTrickett, Jon
Powell, Sir Raymond (Ogmore)Vaz, Keith
Prentice, Mrs BridgetWallace, James
(Lewisham E)Walley, Ms Joan
Prentice, Gordon (Pendle)Wardell, Gareth (Gower)
Prescott, Rt Hon JohnWareing, Robert N
Primarolo, Ms DawnWelsh, Andrew
Purchase, KenWicks, Malcolm
Quin, Ms JoyceWigley, Dafydd
Radice, GilesWilliams, Rt Hon Alan
Randall, Stuart(Swansea W)
Raynsford, NickWilliams, Alan W (Carmarthen)
Reid, Dr JohnWilson, Brian
Rendel, DavidWinnick, David
Robertson, George (Hamilton)Wise, Mrs Audrey
Robinson, Geoffrey (Cov'try NW)Worthington, Tony
Roche, Mrs BarbaraWray, Jimmy
Rogers, AllanWright, Dr Tony
Rooker, JeffYoung, David (Bolton SE)
Rooney, Terry
Ross, Ernie (Dundee W)Tellers for the Noes:
Rowlands, TedMr. Dennis Turner and Mr. Joe Benton.
Ruddock, Ms Joan

Question accordingly agreed to.

Resolved,That the Local Government Finance (Scotland) Order 1997, dated 12th February 1997, which was laid before this House on 13th February, be approved.

MR. DEPUTY SPEAKER then put the remaining Questions required to be put at that hour.

Resolved,That the Revenue Support Grant (Scotland) Order 1997, dated 12th February 1997, which was laid before this House on 13th February, be approved.That the Special Grant Report (Scotland) on Supplementary Mismatch Scheme Grant for 1997–98 (HC 272), which was laid before this House on 13th February, be approved.That the Special Grant Report (Scotland) on Grant in aid of building works at Dunblane Primary School and Grant in aid of Local Authority revenue costs resulting from the Dunblane tragedy (HC 273), which was laid before this House on 13th February, be approved.—[Mr. Carrington.]