Local Government Finance

Annette Brooke Excerpts

Tuesday 10th February 2015 Commons Chamber

[Kris Hopkins]

Although I live in a large metropolitan district, I also represent a significant rural area, and I know that many single elderly people live in large houses. That is another form of deprivation, in that they must sustain those houses on limited and fixed incomes.

1 urge all councils to protect taxpayers this year by taking the additional Government funding that is on offer for a freeze. That will enable them to help hard-working households and those on fixed incomes, such as pensioners, with their living costs. The tax-freeze grant will be embedded in councils’ baseline funding. Five successive years of freeze funding have seen council tax in England fall by 11% in real terms since 2010, after being doubled by the last Administration. Our actions will save for the average Band D household up to £1,075 over the course of this Parliament.

[Annette Brooke (Mid Dorset and North Poole) (LD)]

I welcome the extra funds that will help people to be moved from hospital into the community or to other forms of care, but what is the rationale for ring-fencing that pot of money and not ring-fencing the local welfare assistance money?

[Kris Hopkins]

The additional £37 million is specifically to address some of the winter pressures we face. We wanted to make sure that local councils work with authorities to address the particular needs of those individuals we wanted to help move into appropriate accommodation, and make sure there was sufficient and appropriate domiciliary care to look after them. That is why it is targeted around that group.

--- Later in debate ---

[Annette Brooke (Mid Dorset and North Poole) (LD)]

As a vice-president of the Local Government Association, I wish to start by discussing the LGA figures. They point out clearly that there has been a 40% reduction in core Government funding since 2010, and that today’s settlement will require councils to make a further £2.5 billion in budget cuts. We must all be concerned about the financial sustainability of local government, and I concur with some of the points made by Labour Members and by my hon. Friend the Member for Southport (John Pugh). We must praise councils and councillors across the country for the way in which most have responded to the challenges, finding new ways of working, finding efficiency savings and protecting front-line services—and we find that satisfaction in council services has increased. That is remarkable.

I am proud that this Government introduced the Localism Act 2011 and of the emphasis on local decision making, with some notable exceptions such as top-down pronouncements or when local authorities have to implement local schemes with inadequate funds under constraints set by central Government such as the council tax reduction scheme. On that issue, more transparency on central support—or lack of support as the case may be—would be welcome.

Looking ahead, to deliver services more efficiently and effectively and to drive economic growth we must have devolution within and across England and on demand, building on what has been achieved so far. I do not exclude counties, as it is right that we have bottom-up devolution, through which areas outside the cities have opportunities to have more power. Tax-raising powers should be given to such areas. My right hon. Friend the Chief Secretary to the Treasury discussed that very point this week. Westminster has to let go.

It would be good to see published work on the implications of increasing the proportion of business rates retained by local authorities. I welcome the Government’s inclusion in the final settlement of an additional £74 million for local welfare assistance. I could criticise it and say that it is not enough, but to be honest, I am greatly relieved that all the many representations were listened to, including my own and that of the Liberal Democrat communities and local government committee, of which I am a co-chair. I feel so strongly that local authorities are a place of last resort for people who are destitute and who must be able to access immediate support when some unforeseen crisis has occurred.

[Mr Graham Stuart]

Can my right hon. Friend explain why her party believes that the local government settlement should and can be determined by the votes of Scottish MPs, when Scotland decides on the distribution of its local government formula itself? That is fundamentally unfair to the English voter whose will at the ballot box should hold in the way that local government funding is distributed.

[Annette Brooke]

I think I will stick to the issue under discussion this afternoon. I am very much speaking from a personal viewpoint.

Let me continue with comments on the local welfare assistance fund. I wish to address some of the brilliant schemes that the fund has been used to support. I hope that they will be able to continue and that the £74 million will continue—or even be increased—in the future.

On behalf of town and parish councils I wish to make a few general points. It is to be welcomed that no town or parish councils will be subject to the referendum threshold. That has concerned me greatly, because parish councils have taken on more responsibilities as services have been cut from higher level councils. I feel that that is a great deterrent to the taking on of some really important services, such as a community library in my constituency, but concerns remain on the short-changing by some principal councils of Government funding for council tax support. The National Association of Local Councils identified more than 30 such councils this financial year, and its research shows that the number of principal councils not passing on any council tax support funding to town and parish councils will increase in 2015-16.

I have just received a holding answer to some questions that I tabled. I was told that my question on what further action the Minister will take on this issue will take a little more work. I hope that the Minister will be able to give me an answer today. Will he tell me what more can be done to ensure that principal councils pass on this funding, which is intended to be passed on? I represent parts of both rural and urban authorities, and I support the Rural Fair Share Campaign. We have had some welcome steps in the right direction, but there is a central unfairness to rural residents, which is that they receive less in services and pay more. We need much more done in that area.

I welcome the reconsideration by the Government of Christchurch and East Dorset councils’ bid for the transformation challenge award and the allocation now of £867,500. The two councils have been working on service sharing for some time now, following a line suggested by the Government. That process has been hard for staff and a recent survey showed that staff morale is very low. I hope that this fund will mean a smoother process and some reassurances that residents in Corfe Mullen, Wimborne and Colehill in my constituency will not feel that they are on the fringes and left out.

I was very pleased when the three principal councils in Dorset were named as the first winners of the Government’s transformation challenge award in October 2013. With other partners, they are working together to transform how health and social services are delivered across Dorset over the coming years, but despite the excellent work that is taking place, funding for social care remains of enormous concern in my constituency.

I decided to look at my first speech in this House on local government finance and I found that in October 2002 I said that

“in the south-west, a recent analysis shows that there is a £70 million care gap. Local authorities are warning that the social care safety net is not adequate for children, the elderly and the vulnerable.”—[Official Report, 24 October 2002; Vol. 391, c. 452.]

Of course, I was addressing a Labour Government. The needs are rising and the problem is becoming worse, but we should acknowledge that it is this Government who have made moves to bring health and social care funding together to make services work better together and to get more for our money. Those are moves in the right direction, although of course I would like some transparency and clarity about the extra funding available through the better care fund for local authorities.

I recently met the leader of Poole borough council, Councillor Elaine Atkinson, and the Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Bristol West (Stephen Williams). The council leader’s concerns centred around the ranking of Poole, which is the third lowest funded unitary authority in England, and local needs. The greatest concerns were about social care, and I must praise the council leader, who is not a member of my party, for her passion for social care and for producing and providing the best possible services.

In Poole, the over-65s—that includes me—make up 21.61% of the population. That is a very hefty proportion indeed. For the rest of Dorset, the figure is 26.95%, and, interestingly, the figure is lower in Bournemouth. The demands are great and, of course, following the High Court ruling, we have extra expenditure on the deprivation of liberty safeguards. That judgment obviously affects the statutory requirements for all councils, and I am quite sure that it is important, but there is a shortage of funding. Additionally, as many Members have mentioned, there are even more pressures across children’s social care. That is happening for the saddest possible reasons, but at least we are alert to what is happening out there.

With Poole always having such a low ranking, there is very little room for manoeuvre with the extra demands placed on it. There is great concern that not as much money is coming out of the better care fund locally from the Dorset clinical commissioning group as was initially expected. I welcome the fact that Poole is to receive extra funding to help with the winter pressures of people being stuck in hospital when they are sick but do not necessarily need a hospital bed.

A point that the council leader was very anxious to make concerned the difference between Poole and Bournemouth. It is very difficult to make comparisons between different places to argue a case, but her point was that Poole is allowed to retain 25.49% of its business rates whereas Bournemouth is allowed to retain 42.46%. Obviously, that is worked out according to the existing formula. I do not doubt that the figures are correct, but I am beginning to doubt the mechanism, because on the face of it, looking at Poole and Bournemouth, I cannot understand it. I can understand it on the formula, but I think that it will be really sad if we have to wait until 2020 for the make-up of that percentage to be looked at. I would like that to be reviewed earlier.

In conclusion, I have said a lot today about social care, because I think that local government’s greatest concern is that day of doom, as we have heard. The Care Act 2014 is introducing new and welcome responsibilities, but with them come great uncertainty about the scale of the costs. I think that local government has done us proud. It is important that central Government give local government the tools and resources it needs.