Local Government Finance Bill

Unfortunately, the hon. Lady has partly misread the scheme. Paragraph 2(8) of schedule 4 provides the Secretary of State with the power to make regulations in relation to the requirements of schemes, and he intends to use this power to require authorities to provide support for pensioners. The purpose of that provision is precisely to safeguard pensioners—a point on which, it would appear, there is cross-party support. It does not require the Secretary of State to approve schemes, and it is not a power to intervene in schemes. I think that I have made that point clear to the House, and if I have not, I repeat it now to make it so. Several rather whacky points have been made. The hon. Gentleman for Stockport North said—[Hon. Members: ““Stockton North””] Sorry, I should know better. The hon. Member for Stockton North said that Labour had worked hard to close the gap between the rich and poor. Well, I do not know how hard it worked, but it certainly did not work, because the gap between the rich and the poor widened in that time. It did not narrow. He seemed extremely sceptical about whether it was possible for authorities such as Stockton to generate the additional income from discounts and exemptions to compensate them for the loss of council tax benefit grant. By my count, 18 local authorities have been drawn into the debate in one way or another—all of them by Opposition Members praying in aid councils that they believed would be at a disadvantage. Of those 18, 14 could in fact generate from the discounts and exemptions in their areas more money than they would lose from the loss of council tax benefit grant. Among those authorities is Stockton, which would have a surplus, if it extinguished all the discounts. The hon. Member for Stockton North referred to second homes, but an important part of the new flexibility—and part of the reason Stockton could have a surplus—relates to empty homes. Empty homes discounts provide another potential source of revenue. When one considers the generality of local authorities, one discovers that were all those discounts and exemptions to be extinguished—as I said in the previous debate, I am not arguing that they should be, but I want the House to understand that the flexibility is there—it would result in an additional income to local authorities in England of £420 million. By what my hon. Friend the Member for Bradford East (Mr Ward) called a fluke, that happens to be the same amount as the 10% reduction. The Government are not arguing that every local authority should simply extinguish those discounts and exemptions. We are simply pointing out that that provides for a significant flexibility, and I would be surprised if a large majority of councils did not choose to make that flexibility a part of the mix when devising a scheme. Local authorities need to plan carefully to ensure that they can meet demand through the funding that they make available to local schemes. As the hon. Member for Warrington North acknowledged, however, funding for the first two years of localised schemes is derived from the Office for Budget Responsibility forecast for spending on council tax benefit, which reflects existing spending and, therefore, assumptions about underlying demographic changes, including growth in the pensioner population, and council tax increases. Thereafter, of course, the spending review process will provide further opportunities to consider cost pressures. Local authorities are already well accustomed to using these powers to determine in what circumstances council tax liability should be reduced, whether in individual cases or a class of cases. Local authorities are best placed to understand local needs, including those of low-income families. Paragraph 2(5) of proposed new schedule 1A to the Local Government Finance Act 1992, which is inserted by schedule 4, already requires local authorities to set out the procedures for making an application for a reduction under the scheme. Amendments 56 and 70 would require local authorities to take into account the impact of their schemes on the living standards and work incentives of taxpayers, and on poverty levels when designing or revising their schemes. However, local authorities already have clearly defined responsibilities in relation to, and for their awareness of, the most vulnerable groups and individuals in their areas. My hon. Friend the Member for Mid Dorset and North Poole (Annette Brooke) made the point that there are statutory responsibilities on local government when drawing up such schemes, or indeed taking any of its functions forward. An important example is the public sector equality duty in section 149 of the Equality Act 2010, which requires authorities in the exercise of their functions to have due regard to the promotion of equality between persons who share a protected characteristic, while the Child Poverty Act 2010 imposes a duty on local authorities to have regard to, and to address, child poverty. She referred, quite properly, to the Disabled Persons (Services, Consultation and Representation) Act 1986 and the Chronically Sick and Disabled Persons Act 1970, both of which include a range of duties relating to the welfare needs of disabled people. She also referred to the Housing Act 1996, which gives local authorities a duty to prevent homelessness. Putting all that together, it is quite clear that every local authority is familiar with the need to ensure that any scheme it draws up complies with existing statutory guidelines. That is a continuous process that requires all the relevant decision makers to consider equality, disability and other issues, in forming policy and making decisions. We expect to continue with that sensible approach. There is no reason for unnecessary additional bureaucracy to be imposed on local authorities.