Local Government Finance

Debate between Graham Stuart and Chris Williamson

Tuesday 10th February 2015 Commons Chamber

[Chris Williamson (Derby North) (Lab)]

I congratulate my right hon. Friend the Member for Leeds Central (Hilary Benn), the shadow Secretary of State, on his excellent exposition, setting out Labour’s alternative to what the Government have put forward today.

We are meeting at an apposite time. Hon. Members have referred to the reports of the National Audit Office and the Public Accounts Committee. I have with me a copy of the PAC report. To summarise it in respect of the Government’s record on local government, let me say that the Government have failed to provide leadership on local government finance; failed to understand the impact of the cuts they are making; failed to apply the cuts fairly, as we have heard today; and failed to recognise the effect that the cuts are having on councils’ ability to deliver their statutory services.

Many of us here will be familiar with the “graph of doom” produced by the Local Government Association, which has pointed out that in a very short time local authorities will be capable of delivering only their statutory services, and that if the funding arrangements continue on their present trajectory, many authorities will be struggling to deliver even their statutory obligations.

It was my privilege a couple of weeks ago to re-launch the “Fair Deal for Derby” campaign. Derby has been crucified by this Administration, and the Secretary of State is acting like a giant wrecking ball on local government services in the city. We have seen a reduction in funding for the local authority of some £379 per household in the city of Derby. The cuts that the council has already had to make amount to some £96 million with a further £69 million to find—unless the Government change tack or unless, as we hope, we see the election of a Labour Government on 7 May.

[Mr Graham Stuart]

Is it the hon. Gentleman’s understanding, as it is mine, that the Labour party has not pledged to increase the overall funding envelope for local government? Will he spell out—in a way that the right hon. Member for Leeds Central (Hilary Benn) failed to do—exactly who would be the losers in a process where there will be no winners except at the expense of others?

[Chris Williamson]

My right hon. Friend the Member for Leeds Central was absolutely clear about the funding. He said there would be a fairer funding settlement. I cannot see how my right hon. Friend could have been any clearer than that. What we have seen over the past four and a half years is anything but a fair settlement. What we have seen is the neediest and most deprived parts of the country shouldering the biggest burden. What did we hear from the Prime Minister and the Chancellor? We heard that they would not balance the books on the backs of the poorest people, yet that is precisely what they have done, as we heard from my right hon. Friend.

My local authority in Derby will have lost half its budget. Just imagine the impact of that on council services for vulnerable children and elderly and disabled people in our city! Social care has been decimated, and facilities such as street cleaning, street lighting and leisure services are also under threat as a result of the Government’s cuts.

Last week saw the ridiculous scenario, the ridiculous spectacle, of the Secretary of State coming to Derby and suggesting that the council should use its reserves. “The council has £81 million in reserves,” said the Secretary of State. “Why does it not use that money?” Well, as my right hon. Friend pointed out, we can only use the reserves once, and, furthermore, they have already been earmarked. They have been earmarked for new schools, for instance, and for the cost of the redundancy payments that must be made to the public sector workers who have had to be sacked because of the unprecedented cuts that the Government have imposed on Derby. It is ludicrous for the Secretary of State to come to Derby and say that the council should simply use its £81 million worth of reserves, as if they were not earmarked, which they are, and as if it could keep on using them, which it cannot. It is crazy for him to do that.

To add insult to injury, not only did the Secretary of State turn up unannounced, but when the leader of the council, Ranjit Banwait, politely asked if the Secretary of State would meet him, the Secretary of State snubbed him. He said, “No, no, I haven’t got time to meet the leader of the council.” The leader wanted to report some of the concerns felt by councillors and some of the problems that the council was facing, and to put the case for a fair deal for Derby, but the Secretary of State was not interested. He was only interested in making political capital and in speaking to the leader’s political opponents, his own Conservative friends on Derby city council.

As if that were not bad enough, the Prime Minister then weighed in. He appeared on Radio Derby, and he too referred to the reserves. He then made the ludicrous assertion that West Oxfordshire district council, his local authority, had been worse affected than Derby. I do not know whether the Prime Minister has been paying a visit to planet Zog or has been living in cloud cuckoo land for the past four and a half years, but the suggestion that West Oxfordshire has been worse affected than Derby flies in the face of the facts. The facts are very clear. The cut in West Oxfordshire amounts to some £90-odd per household, whereas the cut in Derby is almost £400 per household, which is four times as much.

I know that the Prime Minister went to a very good school. He went to Eton, I understand. I left school at 15, and I was not great at arithmetic, but it seems to me that the Prime Minister could have done with spending some time in Labour’s former “numeracy hour” to work out basic arithmetic, because he clearly got that very badly wrong.

As Labour Members have already pointed out, the cuts have caused the economy to struggle and to go into a downturn. We have experienced the longest recession for more than 300 years, and the slowest recovery for more than 100. Why is that? When this Government came to power, they inherited a growing economy and falling unemployment, We had started to turn the corner, but what did the Government do? Owing to their ideological zeal, their determination to smash the state, and their obsession with neo-liberal economics, they sent the economy into a tailspin.

It is important to bear in mind the symbiotic relationship that exists between the public and private sectors. Where does the Minister think public sector workers spend their money? Where do the almost 1,500 redundant council workers in Derby spend their money? They spend it in the local economy; they spend it on goods and services provided by the private sector. That is why it is important to recognise this symbiotic relationship between the public and private sectors. Members on the Government Benches clearly do not understand that or why the economy has struggled so much and continues to struggle. They claim it is doing incredibly well now—well, you could have fooled me and many millions of people who are still struggling with the cost of living crisis. It is obvious that their obsession with austerity and market-led economics and their hostility to the public sector have been an utter disaster in terms of the impact on the people who rely on those services and on the economy.

What is desperately needed is a Labour Government on 7 May, with my right hon. Friend the Member for Leeds Central as Secretary of State for Communities and Local Government, because he has made it very clear that there will be a fairer funding settlement within the financial envelope. We have also made it very clear that a Labour Government would grow the economy, which this lot have been singularly unsuccessful in achieving. We would then be able to use the fruits of economic growth to sustain our public services, to continue to grow our economy and to create that economic virtuous circle.

Today we saw the ludicrous spectacle and the political stunt of the Prime Minister pleading with the captains industry: “Britain needs a pay rise.” I thought for a moment when I saw that that he had converted to the TUC because it has been calling for this for a long time. Yes, Britain does need a pay rise—a pay rise for ordinary people, not the oligarchs and the hedge fund managers who fund the Conservative party, and whom Conservative Members were hobnobbing with last night at their black-and-white ball. What we need is a Labour Government, and a Labour Secretary of State—my right hon. Friend—with a fairer funding settlement so we can get this country back on its feet, and get our public services delivering the services people in our country desperately need.

--- Later in debate ---

[Chris Williamson]

Will the hon. Gentleman give way?

[Mr Stuart]

In a moment. This is not about Toxteth or areas of the most concentrated deprivation; it is about a broader picture in which it would be perfectly possible to protect the most deprived areas of, say, the hon. Gentleman’s constituency while seeking to address an imbalance in the funding formula.

[Chris Williamson]

The hon. Gentleman talks about the income profile of rural residents being somewhat lower. Would he therefore support me in encouraging those living in rural areas to join a trade union to try to improve their living standards and incomes?

[Mr Stuart]

I appreciate the hon. Gentleman’s point, but that would mean a further bill for a left-wing organisation and we know where that leads. He will be aware that in the past couple of years the wages of non-unionised workers have eclipsed those of unionised workers and that the TUC is, for the most part—as, indeed, is the hon. Gentleman’s party—a front organisation for those who receive money from the public purse. Trade union membership does not have a great deal of relevance to those who work in the private sector, which exports across the world and generates the wealth that pays for those of us, including MPs, who are paid from the public purse. However, I would always welcome and support anyone who wished to join a trade union, if they saw fit to do so.

Although there is a smaller gap of £73 per person between rural and urban spending power, it is smaller only because it takes into account the higher council tax that rural residents have to pay. Poorer rural residents are subsidising richer urban authorities. That is worth repeating, because anyone listening to the impassioned protestations of Labour Members would think that was not true: poorer rural residents are subsidising richer urban authorities. There is no acceptable justification for that status quo.

The fact that the Government have introduced the rural services delivery grant during this Parliament and increased it every year is welcome recognition of the rural penalty. This year its value has been set at £15.5 million, or £1.20 per head. At just 1% of the shortfall in the main central Government grant, that additional money does not by itself deliver a fair deal for rural areas.

Paid Directorships and Consultancies (MPs)

Debate between Graham Stuart and Chris Williamson

Wednesday 17th July 2013 Commons Chamber

[Chris Williamson (Derby North) (Lab)]

May I start by saying to the Leader of the House that it seems to me that, in his opening remarks, he was being deliberately obtuse when he said that he did not understand the motion? For clarity, let me read it to him. It seems very clear indeed. It states that

“this House believes that, as part of a wider regulatory framework for second jobs, from the start of the next Parliament no hon. Members should be permitted to hold paid directorships or consultancies.”

It could not be clearer. I do not understand the claim from the Leader of the House that the motion is flawed.

[Mr Graham Stuart]

Can the hon. Gentleman tell us the definition of “consultancy” so that we can all refer to it?

[Chris Williamson]

Here we go again. I was going to go on to say that the Leader of the House accused my hon. Friend the Member for Hemsworth (Jon Trickett) of putting up chaff, and here we have yet more chaff from the hon. Member for Beverley and Holderness (Mr Stuart). There is a clear legal definition of a consultant and if he needs to check that out, I suggest he look up the dictionary definition. I am not going to waste the limited amount of time I have explaining it to him. He knows very well what a consultant is.

As my hon. Friend the Member for Hemsworth pointed out, perception is key in this agenda. We know that Parliament and MPs are held in very low esteem by many of the electorate and it is our duty to try to repair the trust of the electorate. I say that because I have spoken to many constituents—people have also written to me—who have said, for example, that the top-down reorganisation of the national health service was done only because many senior Conservative MPs stood to benefit financially from the 49% privatisation. Surely none of us, on either side of the Chamber, can allow that sort of perception to persist among the wider electorate. People need to have trust in their Members of Parliament. The motion would go a long way towards re-establishing that trust with the electorate at large.

The Leader of the House implied that agreeing the motion would impose some terrible, onerous obligation on Members, as though this idea had somehow dropped from space, from Mars or somewhere. However, if we look around the world, it becomes clear that the restrictions imposed on fellow parliamentarians in other countries are much more stringent than the restrictions in the UK. Our friends in America have imposed strong, stringent restrictions on the elected representatives who serve in that country. This motion contains a reasonable and measured proposition that would put us on a par with many of our international colleagues.

Local Government Finance (Rural Authorities)

Debate between Graham Stuart and Chris Williamson

Monday 11th February 2013 Commons Chamber

[Chris Williamson]

My hon. Friend draws attention to a real problem with the council tax freeze grant, as have Government Members this evening. Local authorities of every political persuasion have seen through the Secretary of State’s wheeze. For many local authorities, taking the grant would clearly create significant problems down the road. That is why we are seeing Conservative, Liberal Democrat and Labour authorities refusing to take the grant, for very good reasons.

We have heard contributions this evening from my hon. Friend the Member for Bishop Auckland (Helen Goodman), who we have just heard from again, and the hon. Member for Beverley and Holderness (Mr Stuart), who spoke passionately about the need for a fairer settlement—although, rather paradoxically, he also said he supported the Government’s austerity programme. It seems to me that he cannot have it both ways.

[Mr Graham Stuart]

This is about the allocation and getting a fair share—hence the name of the Rural Fair Share campaign. We were going to have to control public expenditure whoever was in office; this is about recognising the need to look even more carefully to ensure a fair division based on need.

[Chris Williamson]

I hope the hon. Gentleman would agree, however, that it would be completely unfair to impose even deeper cuts on some of the most deprived local authorities in urban areas. The real issue is that the Secretary of State volunteered to accept unprecedented funding cuts—far higher than those for any other Department—in local government. The blame rests fairly and squarely on his shoulders; he has let down local government in rural and urban areas alike.

We also heard from the hon. Member for Mid Dorset and North Poole (Annette Brooke), who made a significant contribution in calling for greater clarity about funding for local government. She made the point that there is no scope in her local authority for more efficiencies. She and others have seen through yet another scam from the Secretary of State: his “50 ways to save” document. Let me tell him that all local authorities have been doing that for years. I do not understand what he is talking about when he issues such a document. It might make a good soundbite in a press release, but he is not living in the real world.

We also heard from the hon. Member for Totnes (Dr Wollaston), who talked about the cost of delivering health and social care needs in rural areas and referred to the cost of rurality. It was interesting that the Secretary of State, sotto voce, did not seem to understand the term “rurality”. Perhaps that is an indication of the sort of problems that local government in rural areas is suffering from.

Finally, the hon. Member for Penrith and The Border (Rory Stewart) talked about the importance of communities, but when the Secretary of State agreed the unprecedented cuts in local government funding, he drove a metaphorical knife into the heart of local communities up and down our country.