Local Government Finance (Kingston upon Thames)

I would prefer not to because the hon. Gentleman has given me many questions to answer. If there is time at the end, I shall happily do so. Let me finish the quotation from the Liberal Democrat website:"““So poorer areas receive more support than richer ones, now. We would have a similar system to protect deprived areas.””" The hon. Gentleman raised the issue of developing new relative needs formulae for personal social services, which was a priority for the 2005 review of formulae as the old formulae were based on out-of-date evidence. He referred to the fact that a great deal of research was conducted to replace the deprivation top-ups in the three formulae. Large and representative samples of social services clients were included in the research and the progress and outcomes were discussed widely with local authority representatives. We have no current plans to review those formulae. Let me consider the base position from which the grant floor is calculated. In calculating the grant floor guarantee, as well as in presenting year-on-year grant increases, we use a like-for-like basis and the figures are adjusted for changes in function and financing. This year, the main adjustment reflects a change in the way capital projects are financed. More are financed directly by central Government grant and less are financed through the formula grant settlement. So the cash grant increase for, for example, Kingston upon Thames, which the hon. Gentleman cited as 1.9 per cent., is lower than the like-for-like increase, but it remains correct to use the like-for-like figure of 2.7 per cent. The hon. Gentleman asks that, when distributing the financial support for the new free bus fares scheme, we take account of the likely scale of future bus travel. That is no easy task—if we could predict exact passenger numbers, we would have no problem. However, I assure the hon. Gentleman that working groups run by both the Department for Transport and my Department, which include local authority representatives, are considering the best way of distributing the funding in advance of the new scheme starting. The hon. Gentleman mentioned housing surpluses. It is reasonable for Government to claw back surpluses because most council housing has been funded by the Government. If surpluses were not clawed back, we would have to reduce support to more needy areas, cut other forms of public expenditure or raise taxation. None of those options is better than clawing back surpluses and redistributing them according to need. Tenants in surplus areas still get a good deal. Rents are set without any requirement to make a proper return on the capital employed. Consequently, there is a large hidden subsidy—as can be seen from the fact that council rents are generally way below private sector rents. The hon. Gentleman mentioned capital funding allocations and asked why they had not been announced. In the first multi-year settlement, there are practical reasons for Departments not being able to announce allocations for the next two years. Some grants are based on bidding rounds. Some large projects, such as high value transport schemes, are subject to significant timing uncertainties, and it would be an inefficient use of funds to commit them so far in advance. The hon. Gentleman referred in spine-chilling terms to the settlement working group, as if it were some secret organisation that met in a basement, possibly in my Department, but that group is not at all sinister. It is a working group at officer level, chaired by my Department, which includes representatives of local authority groups and Departments. All its papers are published. If south-west London authorities wished to put a paper to that group, I am sure that it would be possible. However, it would not be an appropriate forum for hon. Members to put their views. I assure the hon. Gentleman that the group considered in some detail the new formulae for social services that he has criticised so strongly. The truth about local authority funding is that, in the years of Conservative Government, more than four years before Labour came to power, there was a real-terms cut of 7 per cent. Yet in the 10 years from 1997-98 to 2007-08, overall grant to local authorities has increased by 39 per cent. in real terms. That was not the position with which many of my colleagues and I were familiar in councils in the 1980s and 1990s. I apologise to the hon. Gentleman for not having a response to his question about land charges, but I am willing to write to him about that. Hon. Members are used to the Liberal Democrats facing both ways on issues. It is less common for the same Liberal Democrat Member of Parliament to face both ways at once, but here we have it.