Council tax plea by London MPs

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The Independent Online
A DELEGATION of Conservative MPs and council leaders is to meet Michael Howard, the Secretary of State for the Environment, tomorrow to appeal for extra government funds for London to cushion the impact of the new council tax.

The group represents the London Boroughs Association, which wants the Government to treat the capital as a special case when it allocates grants to reduce council-tax bills.

A report by the Conservative-dominated LBA, out tomorrow, argues that London has a unique set of problems deserving special treatment, just as Scotland and Wales have separate deals.

The association is putting forward proposals that would give the capital an extra pounds 200m. This would help compensate for the pounds 220m it claims London will lose in revenue-support grant from the Government under the council-tax system compared with the poll tax, which it replaces in April. The rest of the South-east would lose a further pounds 220m, it says. These losses would be the equivalent of an extra pounds 74 on each domestic property in London and pounds 51 in the South-east, according to LBA researchers.

As a result, the association claims, council-tax bills, which will be partly based on property values, will be much higher in London and the South-east because of these reduced government grants and because property prices are higher than elsewhere in the country.

The deputation will be led by Sir Rhodes Boyson, Conservative MP for Brent North. He said: 'We are concerned that the council tax will be a serious disadvantage in London and the South- east just as the community charge was in the North.

'I'm concerned out of justice for the people in my constituency and also about the effect on the party if we don't get it right. It could spell electoral disaster in the Tory heartlands.'

Sir Rhodes says the Government could help London in a variety of ways, including introducing a separate property band, placing all London properties in a lower band in the national system, and giving London its own revenue-support grant settlement.

The group will present Mr Howard and his officials with the 50-page report, A Fair Deal for London, which argues that London will lose out on government-approved spending levels and grants for many reasons: high property values; because high non-domestic rates paid in London are distributed to other areas; because the 1991 census appears to have 'lost' hundreds of thousands of people, many of whom failed to register for the poll tax; new responsibilities for community care, insufficiently funded by Government, will place an added burden on inner-city boroughs; high rents and rates and high costs for problems such homelessness, refugees and the concessionary fares scheme.