§ Mr. Austin Mitchell
To ask the Secretary of State for the Environment, pursuant to his answer of 11 May,Official Report, column 170, what increase in borrowing 86W will be required to pay for the costs of local government reorganisation in Humberside; and what plans he has to indicate this at each stage of reorganisation as it is introduced into Parliament.
§ Mr. Curry
The amount of borrowing required will depend, among other things, on what new structure is adopted. The Local Government Commission, in its report on the options for reorganisation in Humberside, gives an analysis of the costs derived from local authority figures as a basis for decisions on the future structure. Following Parliament's decision, authorities that are to be reorganised will be asked to submit updated figures of the transitional costs and the savings and receipts that they estimate will arise each year. Those will provide the basis for annual limits on the amount of borrowing approvals that the Department will grant. The limits will be issued to authorities before the beginning of each financial year.
§ Mr. Mitchell
To ask the Secretary of State for the Environment, pursuant to his answer of 11 May,Official Report, column 120 (1) if he will set out the calculations of savings and receipts on which he bases his statement that borrowings and the interest payable thereon for the cost of local government reorganisation can be paid back;
(2) what assumptions he made when issuing an assurance on costs of local government reorganisation, on the levels of redundancy and transfer arrangements and costs; and when he will be in a position to give estimates of these costs.
§ Mr. Curry
The Government's policy guidance to the Local Government Commission asks it to take all feasible steps to assess all the costs and benefits of options being considered. Its estimates are based on figures provided by the local authorities and are published together with the Commission's recommendations. The estimates in the reports submitted to date show that in most cases the savings and receipts should be sufficient to pay back the transitional costs of reorganisation and interest. There would need to be exceptional non-financial benefits to justify approving a reorganisation for which the savings and receipts were not expected to pay off the transitional costs, including interest.