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Mr. Byers: The hon. Gentleman is right: when we move to the new system we clearly will have to consider transitional arrangements. My worry is that, when I have conversations with colleagues, everyone seems to think that they will be a winner, which is why they want the funding formula to be changed. However, there will be losers—such is the nature of the regime. We have to ensure that we have transitional arrangements in place so that the changes can be introduced over time.

The hon. Gentleman specifically mentioned the position of South Gloucestershire unitary authority. This year, its grant increase is 6.2 per cent. and its education SSA increase is 6.6 per cent. I hope that will make a very real difference to his area. It is one of the best settlements that the authority has had, and, compared with the settlement for other authorities, it is certainly a generous one.

Mr. David Clelland (Tyne Bridge): If we are looking for someone to fight the cause of local government, as the hon. Member for Maidenhead (Mrs. May) put it, we certainly would not be looking in her direction. In the many years in which they were in power, the Conservative Government did nothing but undermine and undervalue local government.

I, too, welcome my right hon. Friend's statement, particularly his promise to reform local government finance. May I, however, caution him to watch his civil servants very carefully? Every re-organisation of local government finance that I have experienced has promised to be fairer and more open and to make more resources available; if he manages to pull it off this time, he will deserve the gratitude of us all.

I suspect that, as in all such statements, the devil is in the detail. As I have not yet had an opportunity to study the detail, will my right hon. Friend tell us whether the very serious problems that have been raised with him by social security authorities in north-east England are dealt with by today's statement, and whether the very serious difficulties facing them will be avoided?

Mr. Byers: When my hon. Friend has an opportunity to look at the settlement, he will see not only the extra £5.8 million for Gateshead, but that increases across the north generally will help to meet the pressures that are coming from social services authorities. With the constraints of the current funding formula, we have not been as generous as I perhaps should have liked and there will be some disappointment in some quarters. However, with the minimum level that we have been able to introduce, we have been able to ensure that there will be a reasonable increase for all social services authorities not only in the north-east but across the country. That will make a real difference.

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Additionally, the £100 million that has been provided to social services to help with bed blocking for the remainder of this year will increase next year to £200 million. Authorities in the north-east will also benefit from that proposal.

I am mindful of the caution expressed by my hon. Friend about the review. All I can say to him is that I will be more than happy to be judged by him and my colleagues on whether the system is fair and just.

Mr. Peter Luff (Mid-Worcestershire): I am grateful to the Secretary of State for the prominence he gave to Worcestershire in his statement, which I am sure is a tribute to the effective lobbying by the county's head teachers and governors on education funding.

I wish to press the right hon. Gentleman on the council tax benefit subsidy limitation. It appears that the SSA for Worcestershire will rise by 6.2 per cent.—on the face of it, a good figure—and the general grant by 6.1 per cent. Does not that mean that the council tax will have to go up by more than 6.2 per cent. to keep pace with the SSA? As the actual unadjusted figures show a 1 per cent. increase in SSA and a 1 per cent. cut in general grant, a still bigger increase may be necessary after the details have been worked through. What will happen to council tax benefit subsidy limitation?

Mr. Byers: I understand that in the hour of questions on the statement hon. Members have not had the opportunity to consider the figures in detail, but when people—including parents and teachers—in Worcestershire and elsewhere have had that opportunity they will see that the new arrangements are a move in the right direction. They do not solve all the pressures and problems in Worcestershire and elsewhere, but they are an improvement on what we have seen over several years.

We are still discussing the council tax benefit subsidy limitation, and I would like to think that I might be able to say something about it when we publish our local government White Paper in a few weeks' time—not long to wait. There is no reason why authorities such as

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Worcestershire should need to put up council taxes by more than 6.5 per cent. or 6.2 per cent. The issue is the level of grant, and people will see that the grant from the Government to Worcestershire and many other shire counties has been far more generous not only this year, but for the past two or three years. If the shire counties recall the early 1990s when their grants were cut by the Conservatives, they will recognise that Labour is their friend in government and the Conservatives certainly were not.

Mr. George Howarth (Knowsley, North and Sefton, East): I, too, welcome the general increases in my right hon. Friend's announcement. I especially welcome the additional resources that will be available for personal and social care packages, which have been a particular problem in Sefton and Knowsley.

I join others in welcoming the changes that my right hon. Friend intends to make in the funding formula to leave behind the Alice through the looking glass formula and introduce one based on the real needs of constituencies such as mine. I look forward to my right hon. Friend making that announcement from the Dispatch Box in a year or so's time.

Mr. Byers: I thank my hon. Friend. Knowsley will get an increase of some £5.9 million, which will be well received. He is right to point out the needs of local authorities such as Knowsley that still face great pressures from high long-term unemployment, which need to be tackled. When people examine how we have been able to allocate the funding, they will recognise that within the constraints under which we operate this is a good deal for all local authorities. We have been able to introduce a minimum level for every type of local authority, including fire and police authorities. Everybody will get an increase of at least the rate of inflation and many authorities, including Knowsley, will receive increases significantly above the rate of inflation.

Several hon. Members rose

Mr. Speaker: Order. We must move on.

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Points of Order

4.39 pm

Mrs. Gwyneth Dunwoody (Crewe and Nantwich): On a point of order, Mr. Speaker. You will be aware that yesterday European Standing Committee B had to abandon its work because of a technicality. Unfortunately, it was considering the European arrest warrant system, which is not only an important constitutional change but will affect everybody in the United Kingdom. It now appears that a decision will be taken in Brussels at the end of this week without the House of Commons having had an opportunity to scrutinise that far-reaching change. I would be grateful if you could tell me whether you have received notice that the Government wish to make a statement about the implications of those changes, or whether any attempt has been made to offer an alternative time to scrutinise that important point.

Mr. Speaker: We have heard nothing about that matter. I sympathise with the point that the hon. Lady makes and the difficulties that she has outlined. I suggest that she takes up the matter with the Leader of the House—perhaps at this week's business questions, which take place on the Floor of the House.

Mr. William Cash (Stone): Further to that point of order, Mr. Speaker. Yesterday's shambles is a serious constitutional matter. A unanimous decision was required in the Justice and Home Affairs Council, and the imposition of a scrutiny reserve on the recommendation of the European Scrutiny Committee is therefore extremely important. Furthermore, the Scrutiny Committee also decided that this matter should be taken on the Floor of the House. Will you, Mr. Speaker, be good enough to ensure that the Leader of the House comes to the House to explain the situation, and that a proper debate takes place on the Floor of the House?

Mr. Speaker: Ministers will have heard what the hon. Gentleman has had to say on this matter.

Miss Anne McIntosh (Vale of York): Further to my point of order yesterday, Mr. Speaker, which can be found at column 76 of yesterday's Official Report. I seek a ruling following your most helpful statement last week that hon. Members should ask direct questions and expect direct answers. I do not know whether you have had an opportunity to read yesterday's Official Report, but we did not get a direct answer to any of the questions that were raised. Madam Deputy Speaker gave a most helpful ruling, when she said:

In my view, he failed to do so.

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