Asked by: Lord Myners (Crossbench - Life peer)
Question to the Ministry of Housing, Communities and Local Government:
To ask Her Majesty's Government what quantitative measure or measures they will use to determine the success of their levelling up policies.
Answered by Lord Greenhalgh
Levelling up is at the heart of the Government’s agenda to build back better after the pandemic and deliver for the people of the UK. The Government will publish a White Paper in due course that will set out our plans in more detail.
Asked by: Lord Myners (Crossbench - Life peer)
Question to the Ministry of Housing, Communities and Local Government:
To ask Her Majesty's Government what assessment they have made of the impact of requiring local authority borrowers to obtain independent credit ratings on the management of local authority borrowing.
Answered by Lord Greenhalgh
Local authorities borrow and invest under the Prudential Framework, and are free to borrow from any source provided it is in UK Sterling, without having to seek Government approval. Local authorities are free to pursue sources of financing that require the authority to obtain a credit rating. However, other options remain available including the Public Works Loan Board (PWLB) which, subject to conditions to prevent local authorities borrowing to invest primarily for yield, requires only that authorities confirm the borrowing is affordable.
Asked by: Lord Myners (Crossbench - Life peer)
Question to the Ministry of Housing, Communities and Local Government:
To ask Her Majesty's Government whether they will announce details of the Shared Prosperity Fund arrangements for Cornwall before the end of the transition period for the UK's departure from the EU.
Answered by Lord Greenhalgh
The UK Shared Prosperity Fund (UKSPF) will help to level up and create opportunity across the UK for people and places.
Funding for the UKSPF will ramp up so that total domestic UK-wide funding will at least match receipts from EU structural funds.
To help local areas prepare over 2021-22 for the introduction of the UKSPF, the Government will provide additional funding to support our communities to pilot programmes and new approaches. Further details will be published in the new year.
Asked by: Lord Myners (Crossbench - Life peer)
Question to the Ministry of Housing, Communities and Local Government:
To ask Her Majesty's Government what assessment they have made of the effect of any fall in the value of retail properties on the finances of local authorities which have borrowed money from the Treasury and government agencies to acquire investment properties outside the geographical limits of the relevant authorities; and what assessment they have made of whether losses that might arise as a result will affect government funding to such authorities.
Answered by Lord Greenhalgh
When local authorities borrow and invest, they must have regard to the Prudential Framework, to ensure that the capital investment plans are affordable, prudent and sustainable. The Department's statutory investment guidance forms part of this Framework, and it makes clear that authorities should include mitigating actions in their investment strategies if there is a risk that asset values will not be sufficient to cover losses to the capital invested.
The Department does not collect data on the regional holdings of local authority owned investment properties. However, throughout this period we have continued to work with local government to ensure we have a collective understanding of the pressures councils are facing, including losses from commercial sources. The Department is working on a comprehensive plan to ensure councils' financial sustainability over the financial year ahead.
Asked by: Lord Myners (Crossbench - Life peer)
Question to the Ministry of Housing, Communities and Local Government:
To ask Her Majesty's Government whether they monitor (1) investments made in commercial real estate by local authorities financed by the Public Loans Board, (2) the location of such real estate, and (3) the consequences of local authorities assuming the associated risk.
Answered by Lord Bourne of Aberystwyth
The decision making process for capital investment and borrowing decisions is a local authority decision. The Ministry for Housing, Communities and Local Government is responsible for the overall framework for local authority capital activity which local authorities operate within. This would include investments in commercial real estate.
Government does not routinely monitor specific investments that local authorities make in commercial real estate, this includes those that are financed by loans from the Public Works Loan Board. Therefore, we do not collect any information on the location of any real estate investments made by local authorities.
The Statutory Guidance on Investments was recently updated by the Ministry for Housing, Communities and Local Government and took effect from 1st April 2018. It was updated to ensure that the framework that local authorities operate within reflects the activities of the sector. One of the key aims of the recent changes to the Statutory Guidance was to enhance requirements of transparency and risk management for all investments including those in real estate.
In addition local authorities must ensure that all of their activities are managed well financially. This includes the legal requirement to have regard for best value. This means that a council must make arrangements to continuously improve the way its functions are exercised and have regard to economy, efficiency and effectiveness.
Asked by: Lord Myners (Crossbench - Life peer)
Question to the Ministry of Housing, Communities and Local Government:
To ask Her Majesty's Government why local authorities can borrow from the Public Works Loan Board to buy commercial property but not to fund the construction of social housing.
Answered by Lord Bourne of Aberystwyth
Under the Local Government Act 2003, local authorities have the freedom to borrow and invest, without government consent, provided that their borrowing is affordable. This is known as the Prudential Framework. Local authorities can borrow from the Public Works Loan Board to fund the construction of social housing. However, this is only where they have headroom to do so under the Housing Revenue Account borrowing caps and provided that any such borrowing is prudential.
We have listened to local authorities who asked for additional borrowing to build more housing. We recently announced that we will raise the Housing Revenue Account borrowing cap by a total of up to £1 billion in areas of high affordability pressure for local authorities who are ready to start building new homes. Local authorities will be able to bid for increases in their caps from 2019-20 to 2021/22.
This will complement measures to support local authorities to build more homes through a longer term rent deal that provides a stable investment environment to deliver new homes. This is alongside an additional £2 billion to deliver more affordable housing for social rent in areas of acute affordability pressure. This will help to deliver the new generation of council house building which the Prime Minister announced recently.
Asked by: Lord Myners (Crossbench - Life peer)
Question to the Ministry of Housing, Communities and Local Government:
To ask Her Majesty’s Government how they assess the success of their 2010 "Strategy for seaside success"; and whether they have further proposals in this field.
Answered by Lord Ahmad of Wimbledon
The Strategy was issued by the last Government and called on third parties to do something about the challenges facing coastal towns. In contrast to this top-down strategy which relied on distant and unaccountable regional government to facilitate ideas, we have focused on empowering local communities.
This Government recognises the economic and social challenges faced by coastal and seaside communities and is committed to making them better places to live, work and visit. That is why we set up the Coastal Communities Fund. This has provided £62 million in grants to 114 projects across UK, levering in £96 million of other funding and delivering over 8,600 jobs, 3,300 training places and over 400 new business start-ups.
We have given communities the means to take control and act in the best interests of their local area through a wide toolkit of powers, options and incentives to help drive growth and jobs. As part of the Growth Deals announced in July we have committed over £500 million to projects put forward by Local Enterprise Partnerships to improve economic competitiveness in coastal areas and, also in July, the Parliamentary Under Secretary of State for Communities and Local Government (Penny Mordaunt) was appointed Minister for Coastal Communities, to help them realise their potential and build a sustainable future for themselves.