Local Government Finance (England)

Lindsay Hoyle Excerpts

Wednesday 13th February 2013 Commons Chamber

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

We will debate motions 3 to 5 on local government finance together.

[The Parliamentary Under-Secretary of State for Communities and Local Government (Brandon Lewis)]

I beg to move motion 3,

That the Local Government Finance Report (England) 2013-14 (HC 948), which was laid before this House on 4 February, be approved.

[Mr Deputy Speaker]

With this we shall consider the following:

Motion 4—Local Government Finance (England)—

That the Referendums Relating to Council Tax Increases (Alternative Notional Amounts) Report (England) 2013-14 (HC 928), which was laid before this House on 4 February, be approved.

Motion 5—Local Government Finance (England)—

That the Referendums Relating to Council Tax Increases (Principles) Report (England) 2013-14, which was laid before this House on 4 February, be approved.

[Brandon Lewis]

This settlement is a landmark for local government. After years of doffing their cap to Whitehall, councils throughout the country can now take charge of their destiny. That message has been in danger of being lost amidst the fog of deficit denial and doom-mongering coming mainly from Labour Members, who are mumbling right now. There are real reasons why people will soon see the benefit of this settlement as plain as day—despite the doom-mongering work of the Labour party.

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[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. If the hon. Gentleman wanted to speak, he should have saved his speech and not used it in an intervention. What I am bothered about is that we have a lot of Members who wish to speak in this very important debate, so we need short interventions. Let us try to get through.

[Brandon Lewis]

My hon. Friend makes a good point. Authorities across this country, particularly small district councils, have to start looking carefully at how they structure their management and how they share management to get best value for their residents’ money. I will come back to that issue in a few moments.

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[Richard Burden (Birmingham, Northfield) (Lab)]

To put it as politely as I can, some of the figures the Minister has been using today are questionable to say the least. He emphasised his willingness to talk. Core Cities twice wrote to his right hon. Friend the Secretary of State to ask for a meeting. There was no response. The Secretary of State is sitting alongside the Minister. Will he tell us through the Minister whether he is prepared to meet Core Cities—

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. We have to get the message across. There are going to be short interventions. The hon. Gentleman has been here even longer than I have so he should know. Short interventions help the debate. The Minister is desperate to get on.

[Brandon Lewis]

Thank you, Mr Deputy Speaker. I am slightly surprised by the comments of the hon. Member for Birmingham, Northfield (Richard Burden). Not only is my right hon. Friend the Secretary of State happy to meet representatives from Core Cities, but I met them myself during the consultation process. They were part of it, so I am not sure where the hon. Gentleman gets his facts.

To help local authorities, we published 50 ways to make sensible savings. [Interruption.] As I might have guessed, the Opposition scoff at the idea that looking after the pennies will take care of the pounds. That is probably why they got us into an economic mess in the first place.

The Opposition should take a leaf from the book of an Olympic hero—Sir Dave Brailsford, the head of British Cycling. His philosophy is the aggregation of marginal gains; tiny changes across the board that add up to the difference between silver and gold. That is what we should be doing. We should not scoff at small savings, because they add up to large amounts.

Thanks to the autumn statement, which exempted local government from the 1% top-slice in 2013-14, councils have time to put their house in order and put people first. As my hon. Friend the Member for Sherwood (Mr Spencer) suggested, they should start by freezing council tax, as Nottinghamshire county council and many others are doing—we know of about 150 already.

Once upon a time under the previous Government, council tax rose exponentially: it more than doubled. We have put money aside to put tax rises on ice for a third successive year. Councils should take advantage of that for the benefit of hard-working people who can ill afford to pay more. Already, 150 councils are taking that high road—councils from Derby to Dorset, from Northampton to Norfolk and Wolverhampton to Watford; but if councils take the low road and put up taxes, they should be aware of the wrath of the taxpayer. We are setting a 2% referendum principle for all principal local authorities, police and crime commissioners and fire and rescue authorities. That is direct democracy in action.

If an authority wants to raise council tax by more than 2%, the local electorate will have the right of veto in a binding referendum. I am sure that some councils may have a case—personally, I cannot see it—but if they do they should put it to the vote. They should stand up before residents and state their case. If they win the argument, so be it, but we will take a dim view of democracy dodgers trying to sneak in under the democratic radar, especially those using levies as places such as Manchester and Rotherham are doing.

I urge hon. Members to think about what we are saying. The Government grant is equivalent to 1%, so councils that are seeking to increase council tax and avoid a referendum are doing so, in effect, for at most 0.99%. What a kick in the teeth for local taxpayers. Any council leader that cannot get their officers and members to work together to find 0.99 % of savings should look again.

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[Julie Hilling]

I do not think the hon. Gentleman has been listening. I am saying that Bolton council is already looking at every one of the points on that list. On pensions, it is a disgrace to say that councillors should not be able to pay into the pension scheme—[Interruption.]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. We cannot have challenges about each other’s pensions at this stage—[Interruption.] Order. Mr Percy, you should know better. I am not worried about your pension; I have no interest in how much your pension is worth, and the House does not want to know either. We want to hear the hon. Member for Bolton West (Julie Hilling).

[Julie Hilling]

Thank you, Mr Deputy Speaker.

The only time my council uses agency staff is when it is forced to do so because of the changes it has had to make. The people I spoke to pointed out that agency staff were often cheaper because they did not have pensions or sick pay, but we want local authority workers to have those things. The council does not send people on leadership courses, and it certainly does not waste money on head-hunters or adverts, because it has frozen all posts. Absenteeism is low, and it invests in physiotherapy to get injured employees back to work. It releases staff only for trade union duties; because of the scale of the changes that the Government have wrought, that is essential for effective consultation with staff. Of course, trade union reps are incredibly busy at this time.

The council does charge for check-off and has never employed a lobbyist. It does private advertising, including on roundabouts across the borough, and has service level agreements with the voluntary and community sector projects to which it gives money. It stopped free food and mineral water years ago, and now provides no tea or coffee at meetings, including all-day planning meetings. There is no first-class travel. Travel is paid at nationally agreed rates, but the top two bands have been cut. It uses videoconferencing when it can, but as the borough is compact there is no money to be saved on travel. It uses the voluntary sector and has had multifunctional printers for years. It does not produce glossy leaflets and makes questionnaires only when it consults on Government cuts.

The council sells the services that it has not already had to get rid of, and the town hall has been hired out for years. It may be able to lease a few more works of art if that makes financial sense, but it thinks that will bring in only a few pennies. It already leases out the Egyptology collection, which raises a lot of money. It saves money on computer software where it can, and asks staff for suggestions.

The Minister will, of course, have been listening very carefully and knows that I have missed two areas. Bolton council wanted me to ask how the Government think it can inform residents about changes to services if it does not communicate with them, and it finds the Secretary of State’s point about scrapping the “town hall Pravda” very insulting. In fact, the newspaper that the council produces four times a year is virtually self-funding.

The Secretary of State says that councillors can issue their own ward newsletter using party political funds—what nonsense. Anyone who has read a Lib Dem leaflet will know that it is not an organ for unbiased truth, and they and I fundamentally disagree with the Secretary of State’s proposal to stop translating documents into foreign languages. Would it not be wonderful if all our residents were fluent readers of English? In the real world, however, in which Labour Members live, people do not. What absolute nonsense to propose that translation undermines community cohesion. Translation enables all our citizens to play a full part in society and find out essential information. Without such information, there are higher costs to the state in terms of health and dealing with problems.

The Government are trying to put up a smoke screen and say that despite the most savage cuts ever known, local authorities do not need to cut services. Cutting more than £100 million from Bolton, the 36th most deprived local authority in the country, is wrong and will mean that my constituents suffer. The Government should hang their heads in shame.

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[Mr Foster]

I will not give way now.

Not only are this Government helping people by reducing their income tax; we are also helping them by keeping their council tax down. Interestingly, the shadow Secretary of State did not mention that issue. As my hon. Friend the Member for Bromley and Chislehurst (Robert Neill) said, the right hon. Gentleman’s speech was full of huff and puff and dated thinking. It was the same old mantra from Labour: nothing about protecting council tax payers from the huge rises they suffered under the Labour Government; nothing about finding more efficient and effective ways of delivering services, as many authorities are now doing; and nothing about the real opportunities provided by the business rate retention scheme. Helping local economies to grow means more money will flow into the local council.

The shadow Secretary of State asked a number of questions. He asked why the business rate baseline had been based on two years, not the five years we originally proposed. The answer is simple: we consulted and that is what the Local Government Association asked us to do. He asked what we are doing to help councils with the potential impact of business rate appeals. Again, we listened to local government, and then agreed that the costs could be spread not over one year, but now over five years, and we reduced by 8% the anticipated income and we have introduced a safety net for those whose income falls below 7.5%.

I was surprised that the shadow Secretary of State again attacked what he called the bedroom tax and failed to mention that the same approach was adopted for 13 years by the Labour Government. [Interruption.] He failed to mention that 390,000 households—[Interruption.]

[Mr Deputy Speaker (Mr Lindsay Hoyle)]

Order. We must have a little more order. It is very hard to hear the Minister, and it is important that all Members can listen to what the Minister has to say.

[Mr Foster]

My point is that the shadow Secretary of State failed to mention that 390,000 households have two or more spare bedrooms, while 278,000 households are overcrowded. However, I will give him some credit for getting up to date in one area. Last September, he came out in support of Manchester council spending nearly half a million pounds on a single Alicia Keys concert, so he is at least ahead of the Secretary of State in that he knows who Alicia Keys is, and I give him credit for that.

The Government have already done much to help local councils by giving them increased freedoms to help them meet the needs of council tax payers. In Monday’s debate, the hon. Member for Derby North (Chris Williamson) said that

“Labour’s policy is to give a fair deal, a new deal, for local government and to allow local government on the ground to determine the shape of local government, rather than it being imposed from the top.”—[Official Report, 11 February 2013; Vol. 558, c. 676.]

That certainly was not the policy of the Labour party when it was in power. Central Government’s stranglehold over local government got ever tighter then, but perhaps he is right and Labour has seen the error of its centralising ways. While the Opposition debate a new approach, we are delivering a new approach. We have already provided greater borrowing flexibilities, a general power of competence, the removal of numerous ring fences, and increased flexibilities in the decision-making process.