Local Government Funding

Debate between Alex Cunningham and Rishi Sunak

Wednesday 27th March 2019 Westminster Hall

[The Parliamentary Under-Secretary of State for Housing, Communities and Local Government (Rishi Sunak)]

It is a pleasure to serve under your chairmanship, Mrs Main. I congratulate the hon. Member for Colne Valley (Thelma Walker) on securing this debate. I join her in paying tribute to all those working in local government up and down the country, including her husband, for the terrific work they do to make our communities better places to live.

It may surprise hon. Members to hear that I agree with much of what has been said. First, the sheer range of things we have heard illustrates the importance of what local government does and the impact on all our residents’ and constituents’ lives. I also agree that local government has been dealing with a very difficult financial climate these past few years, for reasons we do not need to rehash in the short time we have. This Government took the right decision—the moral decision—to get our public finances back in order, and local government has played a very important role in making that happen. It deserves enormous credit for the way it has done that—for finding better, cheaper ways to do things while maintaining high resident satisfaction—but I appreciate that that journey is closer to its end than its beginning.

One thing we may disagree on, though, is the talk of cuts. We heard a lot about cuts and a lot of selective quoting of statistics. The simple truth is that the resources available to local government to spend on core services will be £1 billion higher this financial year than last financial year. That represents almost a 3% rise in the cash available to local authorities up and down the country.

[Alex Cunningham]

The Minister says there will be £1 billion more to spend this financial year, but how many billions have been cut since 2010?

[Rishi Sunak]

I acknowledged right at the beginning of my speech the difficult financial climate that local government has suffered over the last few years. I am not trying to pretend it has not—I acknowledge that. The point is that the Government are absolutely listening and responding. A billion pounds more is almost a 3% rise in funding. That is more than the economy is growing by, and it is more than inflation.

[Sir Christopher Chope in the Chair]

--- Later in debate ---

[Rishi Sunak]

I am conscious of time, so I will make progress. If those peers do not act, then we will act unilaterally. The Government are addressing the point.

I agree with the hon. Member for York Central that high streets are important. That was also mentioned by the hon. Member for Stockton North, who talked about his high street, which I know as it is near my constituency. This Government understand the importance of high streets in creating living, breathing communities. That is why a £675 million high streets transformation fund was announced at the last Budget for all local authorities. I encourage Members to talk to their local authorities and bid for the fund. It is there to fund transformational projects that revitalise high streets and comes on top of the Treasury business rate reductions. The Government are agreeing with and backing local authorities to ensure that high streets remain the beating, vibrant hearts of communities. We are in agreement and there is financial support, through tax reductions and this fund, to support high streets. However, shopping habits are changing and retailers, high streets and planning authorities have to adapt. Business rates are only one part of the answer.

The last thing to touch on is building strong communities. We have talked about high streets and other points. Ultimately, local authorities are making people more proud of the places where they live, partly by building houses that people want to call home, whether through the new home bonus or through the lifting of the housing revenue account borrowing cap. Again, the Government are responding to what local government has asked for and delivering it for them.

[Alex Cunningham]

The Minister is talking about devolution and the responsibility of others. The Mayor of Tees Valley has just spent up to £90 million on a loss-making airport. Does the Minister agree that that money would have been better invested in transport infrastructure that encourages investment and creates real jobs? The airport has not created any new jobs or new flights.

[Rishi Sunak]

I think the Mayor of the Tees Valley, Ben Houchen, is doing a fantastic job of ensuring that the voice of Tees Valley is heard in this place. There has been considerable investment in developing the steelworks, the development zone and tax reliefs, which has been widely welcomed. I know that because my constituents are excited to see the rebirth of Durham Tees Valley airport. I know the airport well and I am delighted that it will now have a bright future under the stewardship of the Conservative Mayor of the Tees Valley.

We heard from the hon. Members for Poplar and Limehouse (Jim Fitzpatrick), for Bolton South East (Yasmin Qureshi) and for York Central about Government funding formulas. There is lots to say about that, but the question was raised about why homelessness is not included in the formula. The simple reason is that the amount of homelessness funding that goes through the local government finance settlement is a very small percentage of the total amount—from memory it is only £175 million. The remainder of the homelessness funding, which is several hundred million pounds, has a dedicated formula specific to it. Obviously, if that changed and a future decision was taken to roll that homelessness money into the overall local government settlement, it would demand a formula of its own. I am happy to give that reassurance.

Deprivation is in the formula and in all the areas where it makes a significant difference. Deprivation has little to do with the cost of maintaining a road or a flood defence, for example, and therefore it is not factored into those areas. Of course, it is factored into all the areas that we heard about, including adult social care and children’s social care. In answer to the hon. Member for York Central, we are working in conjunction with all those Departments to develop formulas that they are happy with.

In conclusion, we believe in local government. As we look forward to the spending review, I and the Department will be making a strong case that local government is funded properly, to do all the things it does today, as well as those it will do tomorrow. Beyond money, we will ensure local government has the power, the flexibilities and the devolution that we heard about from the hon. Member for Barnsley Central (Dan Jarvis). Indeed, the Government are supporting that devolution with a considerable amount of money. That is the future for local government that central Government are backing. I will continue to listen to local government, learn from it and push its case in this Government.

Oral Answers to Questions

Debate between Alex Cunningham and Rishi Sunak

Monday 4th March 2019 Commons Chamber

[Alex Cunningham (Stockton North) (Lab)]

T2. Last week, the children’s sector told us that funding for children’s services has fallen by 29% in less than a decade, and councils, including my own in Stockton, have been forced to cut spending on non-statutory early interventions by half. Will the Secretary of State commit to press the Chancellor to come up with the desperately needed cash for these vital services?

[Rishi Sunak]

I agree with the hon. Gentleman about the importance of prevention and early intervention, which is why the Government have funded the troubled families programme by almost £1 billion over this Parliament. It is doing fantastic work, working with some of the most vulnerable children in our society, enabling them to stay out of care and out of harm’s way.

Local Government Funding

Debate between Alex Cunningham and Rishi Sunak

Wednesday 28th March 2018 Commons Chamber

[Rishi Sunak]

As the National Audit Office pointed out, this Government were alert to the requirements of adult social care building as a pressure. This Government responded by delivering extra money for adult social care.

In general, what this Government are doing is working. In adult social care, we have seen delayed transfers of care fall by 34% in the past year. In housing, we are seeing record levels of new home building and infrastructure investment, and from Teesside to the west country, we are seeing areas seize the opportunity to shape their own future. My hon. Friend the Member for Sutton and Cheam (Paul Scully) was absolutely right when he said that other people may paint a gloomy, downbeat picture, but there are examples of councils delivering for their constituents across the country, and as he pointed out, Kingston is doing a fantastic job.

Indeed, according to the LGA, over 80% of people are satisfied with their local area as a place to live, and satisfaction with local council services has remained entirely stable. To ensure that that continues, it is right that we update and modernise our current funding formulas. In the short term, I want to reassure the hon. Member for Garston and Halewood (Maria Eagle) that the Government are not clawing back section 31 grants, as she suggested might be the case. My right hon. Friend the Secretary of State confirmed that last week.

My hon. Friends the Members for Christchurch (Sir Christopher Chope) and for North East Hampshire (Mr Jayawardena) rightly asked about negative RSG. The Government are aware of the strength of feeling on that issue. We are planning to look at fair and affordable options for addressing that problem and will consult on it shortly after the local elections.

My hon. Friends the Members for St Austell and Newquay (Steve Double) and for Lewes (Maria Caulfield) spoke passionately about the rural areas they represent. They highlighted the historical unfairness in funding that their councils have suffered and why they think that should be addressed. I can confirm to them that understanding the particular costs of delivering services in rural areas and analysing the relative resources they have will absolutely be considered as part of our fair funding review.

My hon. Friend the Member for Bexhill and Battle (Huw Merriman) spoke about the importance of getting population growth right. Areas such as his have seen increases in the number of those of a particular age, which puts costs on to certain service areas. He is right to highlight that the new funding formula should use up-to-date population information and that it should be dynamic and respond to what is happening on the ground.

We have heard about children’s services, and it is absolutely right that we focus attention on vulnerable young people who are denied the stability that many of us sitting in the Chamber have enjoyed. It is a privilege for me to be the Minister responsible for the troubled families programme. Delivered in partnership with local authorities, the programme will invest £1 billion to help the most vulnerable in our society. I spent a morning last week in Liverpool hearing at first hand from the families themselves about the difference that this programme is making to their lives. Conservatives like to measure success by the outcomes we achieve, not just the amount of other people’s money that we spend, and the results are hugely encouraging.

[Alex Cunningham]

Does the Minister recognise the very specific link between deprivation and the number of children taken into care by our local authorities, and what is he going to do about it?

[Rishi Sunak]

What the Government are already doing about exactly that is working with the Department for Education on the most thorough and extensive piece of work ever undertaken to understand precisely the drivers of the need for children’s services, which of course includes deprivation. The report will conclude later this year or early next year, and I am sure the hon. Gentleman is looking forward to reading the results.

Beyond that, the troubled families programme is driving innovation on the ground, changing the way that local authorities work and bringing previously disparate providers of care together to help those who need it most. Other people may like to talk of compassion, but we in the Government are delivering it.

We have heard a lot about spending, but curiously rather less from the Labour party about who is paying for it all. We in the Government know who ends up footing the bill—ordinary hard-working tax payers. Over the past few months, the Labour party’s plans have become abundantly clear. We have heard about a radical change to council tax, a new local income tax, the abolition of the referendum tax limit and, as if that was not enough, a garden tax. Under the previous Labour Government, council tax doubled, and we all know that history tends to repeat itself. I can tell the House that this Government will always be on the side of hard-working tax payers. My hon. Friend the Member for Filton and Bradley Stoke (Jack Lopresti) was absolutely right to say that we should be getting them value for money and keeping their bills low.

Oral Answers to Questions

Debate between Alex Cunningham and Rishi Sunak

Monday 22nd January 2018 Commons Chamber

[Alex Cunningham (Stockton North) (Lab)]

8. What recent discussions he has had with the Secretary of State for Education on outcomes for looked-after children.

[The Parliamentary Under-Secretary of State for Housing, Communities and Local Government (Rishi Sunak)]

Like the hon. Gentleman, this Government have high ambitions for looked-after children and care leavers. The forthcoming corporate parenting provisions in the Children and Social Work Act 2017 will ensure high-quality care and support for these vulnerable young people.

[Alex Cunningham]

I welcome the Minister, my near neighbour, to his new post. When will the Government actually provide adequate funds properly to support these special young people?

[Rishi Sunak]

The hon. Gentleman will be pleased to know that, shortly, the Government will announce the winning applicants to their social impact bond to provide funding for local authorities to improve outcomes in education, training and employment for care leavers.