Orders of the Day — Local Government Finance
Part of the debate – in the House of Commons at 6:30 pm on 1st February 1995.
Eric Pickles Vice-Chair, Conservative Party 6:30 pm, 1st February 1995
The hon. Member for Holborn and St. Pancras (Mr. Dobson) made a disappointing speech. Smear, hyperbole and shroud waving are no substitutes for policy. It is little short of a travesty to suggest that changes in standard spending assessment have been fiddled. I well know that the changes have been brought about by local authority associations. I have in mind especially those recommendations that related to unemployment and social deprivation, which were fought hard, but accepted. The hon. Member for Holborn and St. Pancras was so uncertain of his argument—the House will draw its own conclusions—that he did not dare allow a Conservative Back-Bench Member to intervene in his speech.
My right hon. Friend the Secretary of State was right when he said that we are dealing with a tough settlement. It is one of the toughest local government settlements that I have seen, but no settlement can be judged on the basis of one year. Last year's settlement was extremely good for local authorities. It was much better than it appeared to be at the time. There was no justification for the extravagant claims which were made, such as serious reductions in service. The net fall in the number of people employed by local authorities was slightly more than 1 per cent. Taking into consideration schools that opted for grant-maintained status and the effects of compulsory competitive tendering, we see that last year's settlement was about neutral.
The fact that this year's settlement would be tough has been well flagged in the specialist press. It is well known that directors of finance and leaders of councils, being prudent men, have taken note of reports that the settlement would be a difficult one. They have had much more than three quarters of a year to prepare for it.
We know from a recent Audit Commission report, entitled "Paying the Piper", that there is about £500 million within the system that could be diverted to front-line services.