§ 8. Mr. Andrew F. Bennett
asked the Secretary of State for the Environment if he will publish any evidence he has as to the relationships between local government spending and levels of employment directly in local goverment and employment in industries supplying local government, respectively.
§ Mr. Guy Barnett
Information on expenditure and employment in local government in past years is given in Tables 21, 22 and 30 in Annex 10 of the Layfield Report on Local Government Finance. Information about the effects of local authority expenditure on the levels of employment in supplying industries is not available.
§ Mr. Bennett
Is my hon. Friend aware that cuts so far in local government spending have had odd effects on employment prospects in local government? Is he aware that many planning departments have managed to maintain staff levels with little chance of carrying out their plans, whereas many social work departments have had severe cuts in staff, although they face continuing problems?
§ Mr. Barnett
It is difficult for me to comment on my hon. Friend's question, because he has not given any specific examples, but, even if he had done so, local authority employment is very much a matter for the authorities and not for us.
§ Mr. Evelyn King
May I make a helpful suggestion? If the hon. Gentleman is seeking to save money painlessly, will he take another look at the Dobry Report? Is he aware that it has been estimated that needless planning delays are now costing up to £1,000 million a year? That is money that could be saved and devoted to building houses.
§ Mr. Barnett
I shall consider the issue that the hon. Gentleman has raised without making any commitment.
§ 11. Mr. Durant
asked the Secretary of State for the Environment what has been the percentage increase in local government spending since February 1974.
§ 12. Mr. Cartwright
asked the Secretary of State for the Environment if he will make a statement about the progress of 638 his efforts to restrain local government spending.
§ Mr. Shore
In 1974–75 local authority current expenditure increased by 9.3 per cent. over 1973–74 and in 1975–76 is estimated to be 6.1 per cent. over the level reached in 1974–75. The April forecasts for 1976–77 indicated a level of expenditure for that year some 3 per cent. to 4 per cent. over the latest estimate for 1975–76. Following the issue of my Circular 45/76, we expect revised returns from local authorities by 16th July. These returns will be discussed at the consultative council on 27th July.
§ Mr. Durant
Does the Minister agree that local government expenditure is still not fully under control? How does he reconcile the circular—mentioned in The Times today—from his Department to the Camden finance officer saying that he does not have to pay so much attention to financial control? Does not the Secretary of State agree that local government expenditure is leaking like a sieve?
§ Mr. Shore
No, Sir, I do not accept that. There has been a marked improvement in the overall control by local authorities over their expenditure in the past two years, particularly since we have been able to develop the relationship with them that my predecessor established in the consultative council, which is a valuable innovation. All the signs are that from an admittedly high and accelerating rate of expenditure—of which I do not think that the hon. Gentleman would accuse us of being the principal authors, because local authorities were encouraged to budget forward at the rate of 8 per cent. a year by the right hon. Gentleman who held high office in the previous Administration local authorities have had to decelerate, and it is not easy to do that. I do not accept that local government expenditure is out of control. As to the alleged laxity reported in The Times, this was an attempt to clear up the relevance of the housing revenue account to the general figures of overspend which we identified in the circular.
§ Mr. Cartwright
Is my right hon. Friend aware that many of us who have had practical experience of leading local authorities accept the need for sensible pruning of local government aspirations 639 in present circumstances? That is very different from the wholesale cuts that are being considered by local authorities such as Surrey. In trying to keep local government expenditure to the levels voluntarily agreed, will my right hon. Friend try to avoid giving aid and comfort to those who have never accepted the necessity for a high level of local government services and who take the earliest opportunity of cutting services painstakingly built up over many years?
§ Mr. Shore
My hon. Friend speaks with practical experience in local government and he will be the first to recognise the tightrope that we walk. I do not wish to encourage local authorities to engage in a massive attack on their expenditure on services that they render to the people in their communities. I would deplore it as strongly as would my hon. Friend if my words were misused by politically-motivated councils to attack standards of services which their people have a right to expect. On the other hand, I think it right to ask, in the context of the general difficulties we face, that local authorities should live up to the agreement that they entered into only a few months ago, which involves public expenditure pruning.
§ Mr. Raison
The Secretary of State referred to the article that appeared in The Times this morning. Does he accept the argument of the London authorities that rate spending on housing revenue account should fall outside the limits on local authority spending? Does he accept that the present grant system discriminates against under-spenders in favour of over-spenders, and has he any plans to do something about that?
§ Mr. Shore
On the hon. Gentleman's first point, I stick to what I said earlier. The circular states that the housing revenue account is not included in the £350 million to £450 million potential overspend which is identified there. As to whether the grant formula discriminates in favour of those who over-spend as distinct from those who under-spend, I am studying that question very closely. The evidence tends to suggests that that is so, and that causes me considerable concern.