Local Government Finance

Jack Dromey Excerpts

Wednesday 5th February 2020 Commons Chamber

[Andrew Gwynne]

I will give way a little later on, because I have been generous so far.

The Tory-led Local Government Association estimates that if we continue on this current course, the funding gap will grow to £8 billion by 2025. That is an £8 billion gap not to rebuild our services after 10 years of cuts, but just to stay still: just to prevent already heavily stretched services from falling apart under the weight of growing demand, rising costs and wage inflation. I reiterate: it is £8 billion more needed just to stay as we are today. So, even if this £8 billion funding was provided, in full, by 2025, it would barely keep the sector’s head above water, allowing councils to continue delivering services at current levels, with no capacity to meet the growing need for services. It would be interesting to know whether the Minister considers that a sustainable way to finance the sector. As my hon. Friend the Member for Sheffield South East (Mr Betts), the Chair of the Select Committee, has mentioned in an intervention, research published today by the Local Government Information Unit shows that 73% of councils would not agree with Ministers. The Chief Executive of the LGIU has warned:

“Our social care system is no longer on the edge, it’s fallen off the cliff. Our children’s services aren’t at breaking point, they’re broken.”

That has real-life consequences: Age UK estimates that in the past two years alone, 74,000 older people died waiting for care. An average of 81 people a day, equivalent to three every hour, died before they received the care that they needed. This is not a political point; it should shame each and every one of us, on whichever side of this House we sit. Age UK states that 1.4 million older people are not getting the help that they need to carry out essential tasks such as washing themselves, dressing and going to the toilet. That is not just unacceptable; it is appalling. It is a stain on this House—on all of us—and on our country.

[Jack Dromey (Birmingham, Erdington) (Lab)]

My hon. Friend is making a powerful speech. Birmingham City Council and the great city of Birmingham have been hit hard by the biggest cuts in local government history—cuts of £700 million—with children’s centres and youth clubs closing, and social care and special needs provision being cut. Does he agree that it is fundamentally wrong, not only that the vulnerable have been hit as hard as they have, but that Birmingham reels from those cuts while the leafy shires of Surrey get yet more?

[Andrew Gwynne]

I agree with my hon. Friend, who has been a champion for not only local government across the country, but that great city of Birmingham, fighting the devastation that has befallen that great city. On the LGA’s own statistics, a further £48 million in adult social care funding could be removed from Birmingham to add to the devastation that has already hit his city. That is why the fair funding review is so unfair and wrong.

According to the King’s Fund—so this is not coming just from the LGIU—by the end of the next decade the number of older people who need adult social care support is predicted to increase to 4.1 million. That is piling even more cost pressures on our local councils, which is why the LGIU also highlights the increase in financial pressures on children’s services, as adult social care is only one part of the very costly equation that is people-based services—the services that councils, by law and by right, have to provide. Mrs Smith, on any street of any town in any shire, thinks that her council tax increases are going towards ever-reducing bin services, and she sees parks not being maintained and libraries closing. That is because she never sees the impact on adult social care and children’s services.

On children’s services, the LGIU argues that councils are no longer able to shield vulnerable children from the worst of the budgetary pressures that councils are facing. More than one in three councils said their inability to protect vulnerable children was their biggest concern. We know that there are unprecedented demand pressures on children’s services. The number of children in care has hit a 10-year high, but without the funding to support that increase in demand.

From 2009 to 2019, the number of section 47 inquiries—that is, where a local authority believes that a child is suffering, or is likely to suffer, significant harm—has increased by 139%. The Local Government Association warns that children’s services alone are facing a £3.5 billion funding gap by 2025. It is these pressures on people-based services that are pushing many councils towards the cliff edge, and sticking plasters will no longer suffice. The Minister will no doubt say that he gave £1 billion to be shared by adult social care, children’s services and provision for NHS winter pressures. That is not enough.