This is the text of Sir George's speech in the debate on Local Government Finance:
Sir George Young (North-West Hampshire): I hope that the hon. Member for Sheffield, Attercliffe (Mr. Betts) will excuse me if I do not pursue his interesting arguments, but in the time available I have one or two points of my own to make.
I think that we have just gone past Groundhog Day, but I think that, listening to this debate, we all had the impression that we have been here before. It is absurd that in a debate of this importance some six Back Benchers get called, and I hope that in future we can have more time to debate what is a fundamental redistribution of a huge sum.
My case against the settlement is that the Government have made it virtually impossible to deliver not the commitments that councillors have made, but those that the Government have made. They are willing the end but they have not willed the means. They have made it clear that they want to drive up the standard of public services, particularly education and social services, and I share that ambition. However, the impact of these redistributive proposals makes that impossible not only in my Hampshire constituency but in swathes of the south-east. As I said in the last debate on these matters, what the Chancellor bestoweth in his Budget, the Deputy Prime Minister taketh away in the revenue support grant settlement.
Monday's letter, which we all received from the Minister for Local Government and the Regions, said:
"Our proposals for the funding of local authorities' revenue expenditure next year provide another significant boost to enable them to make real improvements in their services."
He went on to say that councils should be able to do that
"while maintaining reasonable levels of council tax".
However, to avoid cuts in services Hampshire county council, which was recently awarded top marks for efficiency, is having to increase council tax by 15 per cent.
The Minister will say that Hampshire's grant increase is 3.7 per cent. or £23 million, but the budget increase is 8.2 per cent., or £78 million. A standstill budget would be 7 per cent., so the gap has to be met by a council tax increase of 15 per cent. Does the Minister consider that increase reasonable? It gets worse: Hampshire county council has to passport an increase of 5.9 per cent. to the schools budget, as required by the Department for Education and Skills. That is £26 million, £3 million more than the whole of the grant increase that the council gets from the Government, so that has already been swallowed up by a mandatory increase in one service, leaving minus £3 million in grant to achieve the Minister's ambition for real improvements, coupled with a reasonable increase in council tax. It is simply not believable.
With minus £3 million in grant left, the county council has to address everything else, including the pressures on social services. Last year, because of the lack of supply, prices rose by 13 per cent., and they may go up by 10 per cent. next year. Added to that are all the other inescapable costs: the increase in national insurance contributions, increases in the landfill tax and the crazy idea of fining social services departments for bed blocking. I hope that the House of Lords, however it is composed, will defeat that Bill.
The Minister made a plea for certainty and stability. I support that. He said that there would be no more changes in the formula. However, we are worried about the changes that have already been announced. Will he shortly announce the floors and ceilings for the year after next so that local authorities have some certainty in their forward planning?
If the Minister hoped that the councillors of Hampshire would carry the can for the council tax increase, I have news for him. Councillor Ken Thornber, leader of the county council, ably supported by Hampshire's Members of Parliament, has led a vigorous campaign, which received extensive coverage in the local press. The Hands Off Hampshire campaign has explained what is going on to ratepayers. They have got the message that the Government believe that, in Hampshire, we are all healthy and wealthy and suitable targets for redistribution. They know that they will pay an extra £2 a week on average because the Government have switched resources.
Of course, people in Hampshire acknowledge that other parts of the country have greater needs and fewer resources. We have no difficulty with the regional support grant reflecting that. However, we believe that what is happening is beyond what can objectively be justified and that it is driven by political imperatives. I predict that people in Hampshire will respond by ensuring that the political motives that have driven up the council tax are changed at the earliest opportunity through the ballot box.