Council Tax

In the course of this short debate, three issues have arisen. First, there is the concept of a notional budget and whether that has any status in law. As we have heard, that issue may be going to two judicial reviews, one relating to Surrey and one to Derbyshire. Secondly, what is an excessive budget? Who decides what an excessive budget is, and what are the criteria for deciding that there is one? Thirdly, if there is an excessive budget, who takes the decision to stop it and to punish the local body—council, fire authority, or, as in this case, police authority—that is introducing it? We have heard about the principle of local democracy and local accountability. Over the past year or two, a big buzzword in the Conservative party and the Labour party has been localism. We hear a lot of talk about localism, but see almost no evidence of any move towards delivering it. Localism—local democratic accountability—means that the local community elects its police, fire and local government authorities and decides what is best for local people. It decides on levels of council tax, on what services to introduce or cut and on how to deliver the wishes that local people have expressed through the ballot box. That is localism, giving real power to local people, as happens in just about every other democracy in the world. In Germany, France, Sweden, Norway, Finland, any of the 50 states of the USA or the provinces of Canada, people cannot understand the system that we operate in which 90 per cent. of taxation is brought to No. 11 Downing street, and then some of it is handed out with strings attached. Local authorities, and through them the police and fire authorities, get about 20 to 25 per cent. of their money from local council tax and the rest, with strings attached, from the central Government block grant. The system is alien to most democracies in the world. It was alien to how we operated in this country in the 19th century, when major leaders such as Joseph Chamberlain in Birmingham pioneered the first public transport systems, gas, sewerage and all the rest. That was done by local authorities without their having to go to the Government, cap in hand, and say, "Please can we do this?" Some of the first signs that we were abandoning that came in the 1970s. The famous Clay Cross rent rebels took action back in 1973, for example. Then in the 1980s, the Conservative Government introduced rigid rate capping. Labour opposed that in the 1980s and 1990s, but when it came to power in 1997, it continued the system. The Minister said that the Government had made it more flexible, and there is some truth in that, but they none the less continued the rigid control from the centre over locally elected bodies and local accountability. All the talk of devolution, accountability and localism is absolutely meaningless unless we give real financial power to local democratically elected people. Who should decide whether a budget, in this case a police authority's budget, is excessive? It should be local people. In Surrey, and in Derbyshire, which the Minister mentioned about nine times—I was counting—the police authorities got the full support of the local population through consultation groups. People said, "We think that the police in this area are so underfunded, under-strength and understaffed that we are prepared to pay a higher than normal council tax increase to support them." In both counties, it was a cross-party process. I know for a fact that it was in Derbyshire, and I understand from the Westminster Hall debate, in which I took part and in which, as we have heard, 10 of the 11 Surrey Members spoke, that it was in Surrey as well. It appeared from the consultations with electors' groups and community groups that there was widespread support across all areas for setting the budget that the Government then decided was excessive.