Local Government Finance Settlement: Transition Grant

Lord Beecham Excerpts

Wednesday 16th March 2016 Lords Chamber

Asked by

[Lord Beecham]

To ask Her Majesty’s Government upon what formula they based the transition grant forming part of the recently announced local government finance settlement, and what consultation they held, and with whom, before taking that decision.

[Lord Beecham (Lab)]

My Lords, I beg leave to ask the Question standing in my name on the Order Paper. In doing so I refer to my local government interests.

[The Parliamentary Under-Secretary of State, Department for Communities and Local Government (Baroness Williams of Trafford) (Con)]

My Lords, the approach to allocating resources in the local government finance settlement now looks at the main resources available to local councils. The transition grant is a response to requests from local authorities through the provisional settlement consultation and is for places that did not benefit from these changes in the formula. It will be applied in direct proportion to the difference in the revenue support grant that would have been experienced.

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[Lord Beecham]

My Lords, was it just coincidence that 83% of the transition grant went to 135 Conservative councils, while 16 Labour councils which received moneys received less than either Surrey or Hampshire did individually? To what extent did authorities in the so-called northern powerhouse benefit from the grant, and can the Minister tell us what the impact on councils will be of the announced £6.7 billion cut in business rates on which they were expected to rely in future?

[Baroness Williams of Trafford]

My Lords, I can say from personal experience of where I live that Trafford did not benefit very much at all, and it is indeed a Conservative council. This money is to make up the shortfall of what would have been expected and will help councils to transition towards full local funding.

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[Baroness Williams of Trafford]

Well, that is news to me, my Lords—but they will answer at the ballot box.

[Lord Beecham]

My Lords, would the Minister care to answer my second question about the impact on councils of today’s announcement of a £6.7 billion cut in business rates on which they were expecting to rely?

[Baroness Williams of Trafford]

My Lords, like my noble friend Lord O’Neill, I have not caught fully the Budget Statement, but I will say that residents’ satisfaction with councils has remained high, and I expect it to go on being so. I will analyse what the noble Lord has said because I simply did not catch it in the Budget.