Local Authority Interventions: Sandwell, Liverpool, Thurrock and Tees Valley

Simon Hoare Excerpts

Thursday 7th March 2024 Written Statements

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Simon Hoare)]

All hon. Members will recognise the critical role local authorities play in providing services to their residents and being accountable to the communities they serve. I would like to update the House on actions the Government have taken in relation to four local authorities, which demonstrate the importance with which this Government see our role in ensuring the high standards that we set for local government are met. I am updating the House on the developments in the statutory interventions in Sandwell, Liverpool and Thurrock councils and on the Tees Valley Mayor’s initial response to the independent review published on 29 January.

Sandwell Metropolitan Borough Council

Following evidence provided by a governance review from its external auditor, Grant Thornton, Sandwell Council has been under statutory intervention since March 2022. The review included statutory recommendations to the council and detailed years of governance issues, leadership instability, and a breakdown in trust, respect and confidence between members and officers. These led to some significant failures. The review led the Secretary of State to decide that the council was failing to comply with its best value duty and consequently directions were issued and commissioners appointed.

Given Grant Thornton’s observation that “green shoots” of improvement had started to show at Sandwell, the intervention package was shorter and narrower than other interventions. I wish to update the House on the fourth and final report from the commissioners and the end of the intervention.

The commissioners’ fourth report

Since the beginning of the intervention, the commissioners have been clear about the aim of the intervention, setting out in their first report their “12 proxies for success”, as the House was updated on in the statement of 1 December 2022. These proxies brought together all the recommendations of the Local Government Association (LGA), CIPFA and Grant Thornton reviews, and commissioners reported against these proxies in each report.

On 20 December commissioners submitted their fourth report, setting out that the council is

“a far cry from the organisation first encountered”

in March 2022, and noting the considerable progress even since their third report. They observe

“the scrutiny and accountability systems, including performance and risk management, are robust and being upheld rigorously. The improvement work which was once seen as a standalone priority has now been interwoven with the “business as usual” strategic planning of the council.”

They also praise the staff at the council,

“who were eager to...work hard to improve”

from the outset. They conclude that the council is now an organisation that is “resilient and agile enough to provide its services to residents whilst withstanding adversity, and one with the plans, aspiration and people to strive for excellence independently”.

The commissioners conclude that

“the council is now meeting its best value duty and is capable of taking forward its improvement independently”,

recommending that the directions be permitted to expire as planned on 22 March and that they too leave their roles at the council on that date. Having considered carefully the evidence, including triangulation with the council’s own assessment of its progress and the follow up review from the external auditor, Grant Thornton, I am happy to update the House that the Secretary of State and I are satisfied that the council is now meeting its best value duty. Consequently, when the directions expire on 22 March 2024 the intervention will end.

The commissioners’ fourth report and my response to them and to the leader of the council will be published on www.gov.uk today.

It is right that, as the commissioners acknowledge, improvement “is never finished”: Sandwell is not perfect. However, the draft statutory guidance on best value standards and intervention, which we intend to finalise shortly following the consultation last summer, is clear that

“local authorities are not expected to be perfect before an intervention ends”

and that an intervention should

“resolve incidents of failure to the point where the authority can demonstrate that it now has the capacity and capability to sustain its own journey of continuous improvement without the need for further external involvement.”

It will take continued, concerted effort for the council to sustain the rate of improvement, build further resilience and ultimately continue to improve outcomes for residents. The commissioners note that part of that striving for excellence will include the continued development of the council’s partnership working with its neighbours, the wider local government sector and supporting its staff and elected members.

Next steps

To that end, I am pleased to note that the LGA will be working to support Sandwell over the next 12-18 months, to ensure a steady path out of intervention. As I said in the Chamber in the Adjournment debate on 18 January on the governance at Sandwell, “falling back into the old ways...will not be tolerated.” We will keep a weather eye on Sandwell, and continue to be there to support, advise and encourage.

Liverpool City Council

On 13 December 2023, I announced that the Secretary of State was minded to change the scope of the intervention at Liverpool by returning certain functions to the council by March 2024, together with updating the directions as part of a planned and phased transition towards the end of the intervention. Today I am confirming that these proposals will be implemented.

The intervention started on 10 June 2021 following a best value inspection. Since then, the scope of intervention has changed, and there are five commissioners who can exercise functions relating to regeneration, highways, finance, and property and their associated governance.

When I announced to the House that I was publishing the commissioners’ fourth report, together with the Government’s response that the Secretary of State was minded to change the intervention, I invited representations on the proposals by 2 January 2024. Having considered carefully the two representations received (one from the council and one from a member of the public), and other relevant information, the Secretary of State has decided to implement those proposals.

Accordingly, the Secretary of State has returned certain functions to the council, recognising the progress made and as part of a planned and phased transition towards the end of the intervention. The commissioners will no longer exercise the following functions:

all executive functions associated with highways, from 31 March 2024;

the requirement from section 151 of the Local Government Act 1972, to make arrangements for the proper administration of the authority’s financial affairs, and all functions associated with the strategic financial management of the authority, from 31 March 2024, to include:

the power to amend budgets where commissioners consider that those budgets constitute a risk to the authority’s ability to fulfil its best value duty; and

providing advice and challenge to the authority in the setting of annual budget and a robust medium term financial strategy (MTFS) for the authority.

all functions in relation to the appointment, organisation and performance of persons to positions the holders of which are not designated as statutory officers, and the designation of those persons for tiers 1 to 3 from today.

In addition, directions issued to the council today direct the council to undertake a range of actions to the satisfaction of commissioners, including to:

allow commissioners to provide advice and challenge to the authority on strategic decisions related to its finance function, including the setting of annual budgets and medium term financial strategy;

continue to build on improvements to rebuild trust with residents, in particular to improve FOI performance, report writing and systems to record delegated decisions;

complete a review of the strategic risk management and implement a strengthened mechanism based on its recommendations;

significantly progress the implementation of the corporate landlord model, commence the stock condition surveys to understand better the asset base, develop comprehensive asset management plans and produce a revised structure for the property directorate; and

continue to establish and implement a cultural change programme which embeds a customer focus, performance management culture, systems and reporting across the organisation.

The Secretary of State has removed directions to the authority that commissioners have confirmed have been met and revoked the directions issued on 10 June 2021 and 8 November 2022. Outstanding actions have been retained in the new directions issued today, and commissioners will continue to exercise functions relating to governance, regeneration, property management and appointments (for directors of property, human resources/organisational development and statutory officers).

I also wish to put on record our thanks to Joanna Killian who will be leaving the commissioner team on 17 March when she becomes the chief executive to the Local Government Association.

The new directions, accompanying explanatory memorandum, representation from the council, and my response to the commissioners will be published today on www.gov.uk.

The next commissioners’ report, due in March 2024, will provide a full assessment by commissioners of the intervention and will be vital to support our decision on how to proceed. I will update the House at that time.

Thurrock Council

Thurrock has been in intervention, with commissioners appointed, since 2 September 2022, after grave concerns were raised about the scale and commercial risk facing the council. On 1 March 2023 the intervention was expanded.

On 22 January 2024, commissioners submitted their third report on the progress of the intervention. This describes continued progress, with the council “owning its recovery” and demonstrating it is able to take difficult decisions. I am pleased to see the strengthening of member officer relationships and that all councillors agreed to adopt and commit to the enhanced improvement and recovery plan in October; it is important that there continues to be a whole-council approach to Thurrock’s recovery.

While the progress to date is to be commended, there is still much to do, including addressing ongoing governance requirements and ensuring the council has underpinning plans to implement its recovery, including a corporate plan and operating model. The financial situation should not be underestimated, with commissioners making clear that the challenge remains substantial.

There has undoubtedly been good progress at Thurrock, and it is imperative focus is maintained in the months ahead on the long-term priorities, to continue to build upon and drive the necessary improvements. The commissioners’ report and my response will be published today on www.gov.uk.

Tees Valley Combined Authority

On 29 January my hon. Friend the Minister for Housing, Planning and Building Safety made a statement to this House alongside the publication of the report of the independent panel investigating the Tees Valley Combined Authority’s oversight of the South Tees Development Corporation and Teesworks joint venture.

The review was commenced in June 2023 following very serious allegations made in the House regarding potential corruption and illegality. As my hon. Friend confirmed, the independent panel found no evidence of corruption or illegality and the panel made several useful and important recommendations on governance and oversight.

Upon publication of the report the Secretary of State wrote to the Mayor and asked for an initial response to the report and its recommendations by 8 March: this was received on 28 February and also published by Tees Valley Combined Authority. The Mayor has accepted, in principle, all the recommendations for the combined authority and development corporation. His response proposed actions for each of the 26 recommendations for the combined authority, development corporation, and partners, as well as outlining actions he has already taken, including establishing a combined authority working group to take this forward. I welcome the independent support the Mayor is seeking from the LGA and the Centre for Governance and Scrutiny and have encouraged him to make full use of independent peer challenge and support.

I am encouraged by the progress within the first month and keen to give time now for the Mayor to develop his plans further and implement the changes required. These will enhance the successes of the Teesworks regeneration by ensuring governance arrangements and accountability are strong and transparent, and supported by robust scrutiny. Given the issues raised in the report, it is important that rapid progress is made that engages comprehensively with the substance of the report’s findings to implement lasting change. To that end, I look forward to receiving further updates from the Mayor, which I have asked for initially after six months.

I am confident that the Mayor and his cabinet will implement successfully their plans and continue their important work regenerating and bringing new jobs to the Tees Valley. The Mayor’s response to the review and the Secretary of State’s reply will be published today on www.gov.uk.

Conclusion

I want to acknowledge the work of the dedicated staff who deliver the important services of local authorities, on which local residents depend. I also want to thank the commissioners in Sandwell, Liverpool, Thurrock, and other councils in statutory intervention, for all they do. I will deposit in the House Library copies of the reports and associated materials.

[HCWS319]

Draft Representation of the People (Variation of Election Expenses and Exclusions) Regulations 2024

Simon Hoare Excerpts

Tuesday 5th March 2024 General Committees

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Simon Hoare)]

I beg to move,

That the Committee has considered the draft Representation of the People (Variation of Election Expenses and Exclusions) Regulations 2024.

It is a pleasure, Dame Angela, to serve under your chairmanship.

The draft regulations uprate the maximum campaign spending limits for Greater London Authority and local authority mayoral elections in England to reflect the changes to the value of money. This statutory instrument also provides an exclusion for reasonable security expenses—an issue which I think requires no further amplification from me—from various election campaign spending limits. Finally, the draft regulations make some technical amendments to remove drafting that is now redundant from the Police and Crime Commissioner Elections Order 2012.

Elections rely on the ability of political parties, candidates and other campaigners to communicate their views so that voters may make an informed decision at the ballot box. If approved by Parliament, this draft statutory instrument completes the package of reforms that the Government announced in July 2023 to uprate reserved and accepted party and candidate spending limits and donation thresholds. This is a necessary action, as many of the statutory limits, which are set in absolute terms, have not been uprated in recent times. If we do not uprate them in line with inflation, it means that they continue to be lower in real terms, which has a real impact on campaigning.

Furthermore, no one should feel afraid to participate in our democracy. In the past eight years, we have witnessed, as we all too horribly remember, murders of two colleagues, Jo Cox and David Amess. The safety of parliamentarians and candidates is important and, in recent years, the Government have introduced numerous measures to tackle intimidation in public life. It is of the utmost importance that candidates feel safe to campaign. The Government are therefore explicitly exempting reasonable security expenses from contributing to spending limits for political parties, candidates and other campaigners at reserved and excepted UK elections. I am pleased to confirm that this fulfils a recommendation made by the Jo Cox Civility Commission in its recent report, “No place in politics: tackling abuse and intimidation.” I am sure that the whole Committee will welcome that response.

Turning to specifics, the draft regulations will uprate the spending limits for candidates at GLA elections and local authority mayoral elections. The various spending limits for GLA elections have remained unchanged since they were set in 2000. Due to such a significant gap, the regulations will uprate the spending limits by 81.05%. That means that the limits for a candidate at an election for the Mayor of London will increase from £420,000 to £760,410; the limits for a candidate at an election of a constituency member of the London Assembly will increase from £35,000 to £63,360; and for an individual or party list candidate at the London-wide Assembly election, the limits will change from £330,000 to £597,460.

The draft regulations will also uprate the spending limits for local authority mayoral elections in England by 29.09%. The uprating is done from 2017 to align with the new spending limits for combined authority and combined county authority mayoral elections, recently approved by Parliament in the Combined Authorities (Mayoral Elections) Order 2017 (Amendment) Regulations 2024. This is to ensure parity between mayoralties, and it means that the limits for local authority mayoral elections in England will change from £2,362.059 per elector to £3,040.08 per elector.

The draft regulations will provide clarity for parties, candidates and campaigners, as I say, by explicitly exempting reasonable security expenses from contributing to the spending limits for candidates, political parties and third-party campaigners at UK reserved and excepted elections, other than local government elections in Northern Ireland. The Government will introduce an equivalent exemption for local elections in Northern Ireland in due course. The regulations will not apply to security expenses at devolved elections in Scotland and Wales. The Scottish Government have separately legislated to make similar provision and the Welsh Government have recently consulted on doing so as well.

Many parties and candidates already take the view that security expenses are, in general, not election expenses. This exemption will put that view beyond any doubt and ensure that campaign spending limits are not a barrier to provision of security during election campaigns. I thank the Electoral Commission for drawing the Government’s attention to this point of law and for its support in getting the drafting of this important exemption right.

The draft regulations make minor technical and consequential changes to remove police areas of Greater Manchester, North Yorkshire and West Yorkshire from the Police and Crime Commissioner Elections Order 2012. [Interruption.] At the very mention of West Yorkshire, the hon. Member for Leeds North West arrives in Committee, and he is most welcome.

Those functions have been transferred to the relevant Mayors by separate legislation, so these regulations do not make a substantive policy change. They simply remove the redundant drafting from the 2012 order to ensure that the law accurately reflects that position.

Before uprating election spending limits, the Government consulted the members of the Parliamentary Parties Panel on two occasions. The parties were first consulted in 2020 ahead of uprating spending limits for candidates at local elections in England. In September 2022, the Government wrote to the members of the Parliamentary Parties Panel again regarding uprating election spending limits and exempting reasonable security expenses from those limits. The responses received indicated support for increasing various spending limits and also endorsed exempting security expenses. As is statutorily required, the Electoral Commission was formally consulted on this statutory instrument.

In conclusion, the uprating of campaign spending limits at GLA and local authority mayoral elections in England to reflect inflation is necessary. The significant gap since the limits were last set and the current high level of inflation mean that the uprating exercise is required to avoid the spending limits putting greater constraints on campaigners than originally intended.

I am sure I speak for the whole Committee when I say that violence and intimidation cannot and will not be tolerated and have absolutely no place in our public and democratic life. The security expenses exemption will bring clarity and reassurance for parties, candidates, third parties and those who enforce the rules as to their ability to incur security expenses without it impacting on their overall spending limits.

--- Later in debate ---

[Simon Hoare]

I am grateful to the hon. Lady for her in-principle support for this measure and for her general approach to the issue. With regards to timing, this is the fourth of a quartet of SIs dealing with these matters. The Government will of course always strive to meet the Gould principle: we aim to comply with the principle wherever possible. This was a judgment call. I will be perfectly frank with the hon. Lady and with the Committee: we could have delayed this until after the elections in May. We took the view that, given the need for clarity on security and on upgrading, it was better to do it now. I take entirely the point that she made that it is relatively close to May to make the decision, but I took it in good faith, believing it to be helpful to candidates, particularly on security.

As for how the guidance on expenses will be dealt with, these things have to be done in a sensible and prudent way. Given the temperature of some of our political discourse in this country, I am tempted to say that security issues trump all, and the Electoral Commission and others who inspect candidates’ returns will take that into account. That is not an excuse to defray other campaigning costs under the banner of security. To do so would not only be wrong; it would also be deeply dangerous and offensive to those whose memory I mentioned in my opening remarks, and to others. The hon. Lady was right to point to the spirit of International Women’s Day and the disproportionate amount of abuse that female politicians receive, irrespective of party. We would do well to bear that in mind.

As my right hon. Friend the Prime Minister said on Friday outside Downing Street, our democracy feels slightly under threat. The defending democracy taskforce, which I sit on with my right hon. Friend the Minister for Security is bringing together a whole raft of agencies and involved parties to ensure that everybody who takes part in our democratic life, whether they are a deliverer, campaigner, door knocker, putter-up of posters, candidate, candidate’s agent, a member of a candidate’s family or whoever, feels safe and secure in fulfilling that important role. If we want people to stand, they must feel safe to be able to do so. I know that the hon. Member for Vauxhall will agree with me on that. The whole purpose is to ensure that security is understood clearly by those standing and helping in those elections and those monitoring and regulating the expenditure.

We take this issue seriously. Where we think that there are new burdens, as the hon. Lady will know, with regard to voter ID and changes to postal votes, we have created a new burdens fund for local authorities. We keep those issues entirely and consistently under review, because—without sounding too lofty, because I think that there is comity between the Front Benchers on this— we really cannot put a price on the functioning of our democracy. The Government stand ready to do whatever they can, wherever and however they can, to ensure the safe progress and conduct of our elections such that when results are declared, irrespective of which body there is an election to, the victorious are confident in the legitimacy of their victory, as are their supporters and voters, but, more importantly—I suppose this is really the fulcrum on which our democracy rests and works— the defeated know that they lost fairly, squarely and legitimately. Everything that we have been doing post the Elections Act 2022, with all the flow-through of statutory instruments, is designed with that key importance in mind. I hope that that is helpful to the hon. Lady.

Question put and agreed to.

Oral Answers to Questions

Simon Hoare Excerpts

Monday 4th March 2024 Commons Chamber

[Mr Toby Perkins (Chesterfield) (Lab)]

5. If he will make a comparative assessment of trends in (a) the level of local government financial settlements and (b) the number of cars damaged as a result of potholes in the last 10 years.

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Simon Hoare)]

We have made available up to £64.7 billion for local authorities through the 2024-25 local government finance settlement. Local authorities can decide how to spend the majority of that funding. The Government are also investing more than £5 billion into local highways maintenance in this Parliament. In October, we announced a further £8 billion to fix our roads.

[Mr Perkins]

GoCompare’s recent pothole report described the potholes in Tory-run Derbyshire as the very worst in England. The Conservative council leader was clear in his view that it is funding decisions from central Government that have forced the county to adopt what he called the totally ineffective “sticking plaster and patching approach”. He said that the funding from the Government

“doesn’t touch the sides of the issue for counties”

across the country. Why should Derbyshire motorists pay a Tory pothole tax, with tyres, springs and suspensions all constantly needing repairing as a result of the state of our roads?

[Simon Hoare]

For the hon. Gentleman’s benefit, let me repeat those figures of £5 billion for local highways maintenance and the additional £8 billion announced in October. That will fill holes, including in Derbyshire and his constituency, to support motorists, the economy and people going about their business.

[Mark Pritchard (The Wrekin) (Con)]

It is normal in these circumstances to invite a Minister to visit a constituency. The Minister is welcome to visit my constituency, The Wrekin in Shropshire, and the Telford and Wrekin borough, but if he visits the Telford and Wrekin borough bit, could he bring a spare tyre? The potholes there are enormous. I thank him for allowing £32 million to be released over the next 11 years to ensure that those potholes are filled. Rather than a pothole tax, may I thank him for the pothole fund? Finally—[Interruption.] I will not give a “finally”, but he is very welcome to visit. Bring a spare tyre!

[Simon Hoare]

As I struggle with my Lenten observations, I need no lessons about spare tyres—it is all about trying to get rid of spare tyres, as far as I am concerned. I am grateful for my right hon. Friend’s comments. The Wrekin is a part of Shropshire that I know well. Those sums can and should be used by upper-tier authorities, which are the highways authority, to ensure that their networks are working well, smoothly and safely. That benefits all, and the Government are putting up the money to allow them to do that.

[Mr Speaker]

I call the shadow Secretary of State.

[Angela Rayner (Ashton-under-Lyne) (Lab)]

Public service workers and local leaders across the country are working incredibly hard to improve their local areas and provide vital services, so rather than the begging bowl culture that makes them bid for money, will the Minister take forward Labour’s commitment for a long-term, more secure funding settlement to allow them to plan for the future?

[Simon Hoare]

I am intrigued by what the right hon. Lady proffers to the House. Only a few weeks ago, in the debate on the local government finance settlement—none of her colleagues apart from the hon. Member for York Central (Rachael Maskell), the hon. Member for Sheffield South East (Mr Betts), who chairs the Levelling Up, Housing and Communities Committee, and those on the Front Bench could be bothered to turn up and speak on it—the hon. Member for Blaydon (Liz Twist), who is sitting next to her on the Front Bench, said:

“As I will come on to say shortly, we will have a review to look at the long-term plans. We understand the problems that local government is facing.”—[Official Report, 7 February 2024; Vol. 745, c. 326.]

May I say to the right hon. Lady that part of the job of being in Opposition is to work out the policies that she may want to deliver in government?

[Peter Grant (Glenrothes) (SNP)]

6. What steps he is taking to tackle Islamophobia.

--- Later in debate ---

[Mohammad Yasin (Bedford) (Lab)]

8. What his planned timescale is for reviewing the flood recovery framework.

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Simon Hoare)]

I am grateful to the hon. Gentleman for his question. I am pleased to report that the review of the flood recovery framework has already begun and I expect the work to be completed by autumn this year. We will, of course, update Parliament in the usual way when that review is completed.

[Mohammad Yasin]

My constituent Lucy owns Ride Leisure Events on Wyboston Lakes, which flooded again during Storm Henk. She cannot get insurance and her business is not entitled to compensation under the flood recovery framework because of the Government’s arbitrary decision to expect cash-strapped councils to cover the cost if fewer than 50 properties are impacted. It is very unfair that my constituent has fallen through the safety net. She will not be the only one, with property in Kempston regularly affected by flooding. Will the Minister crack that anomaly in the framework and help my constituent save her business?

[Simon Hoare]

I am sorry to hear about that case, and if the hon. Gentleman wishes to write to me giving details of the business, I will of course look into it. As for Storm Henk, 2,241 properties have been identified as eligible for grant support. That covers 16 upper-tier local authorities, and to date payments of £788,743 have been reported by authorities to impacted householders and businesses. There always has to be a rubric in these cases, and this issue will be considered during the flood recovery framework review, on which, as I have said, we will report back to the House. However, the offer is there: if the hon. Gentleman wishes to write to me, I will happily look at what he has to say.

[Alexander Stafford (Rother Valley) (Con)]

Whiston has been flooded repeatedly over the past decade, and there is a huge ongoing issue, but Rotherham council recently approved the building of 450 new homes there. Whiston Parish Council, which is independently aligned and thus not party political, called a special public meeting about the plans, which show water running uphill—which I believe it does not do—and floodwater draining into a non-existent stream. This surely demonstrates that Rotherham Council does not understand the issue of flooding. Does my right hon. Friend agree that all councils, including Rotherham, have a responsibility not to build on floodplains?

[Simon Hoare]

My hon. Friend has raised an important issue. Between them, the local planning authority and the Environment Agency should always find the most appropriate sites for development and take hydrology and water management into consideration. The Minister for Housing, Planning and Building Safety, my hon. Friend the Member for North East Derbyshire (Lee Rowley), will have heard what my hon. Friend has said, and may contact him in due course.

[Alistair Strathern (Mid Bedfordshire) (Lab)]

10. Whether he has had recent discussions with local authorities on adopting private roads on new estates.

--- Later in debate ---

[Florence Eshalomi (Vauxhall) (Lab/Co-op)]

This week’s Budget will be a big one for young people—16 and 17-year-olds—who are starting work or making important education choices, yet they currently have no say on who will be the next Government. We on the Opposition Benches believe in our young people. Will the Government act now to give 16 and 17-year-olds a say in the next general election?

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Simon Hoare)]

The hon. Lady makes a case for lowering the voting age—one that I do not support and the Government do not support. The age of 18 is seen as the age of maturity in this country and many others across the world. It seems to have served us pretty well up to now and I see no particular reason to change it.

[Marco Longhi (Dudley North) (Con)]

T3. Will the Minister join me in congratulating South Staffordshire Council on serving an enforcement notice to rebuild the Crooked House pub? Will he also look favourably at measures I will be bringing forward to ensure that heritage pubs are better protected, because, as he will know, the Crooked House and many others have had no protections at all?

--- Later in debate ---

[Simon Hoare]

Yes.

[Luke Hall (Thornbury and Yate) (Con)]

Councillors will not be covered by the newly passed Neonatal Care (Leave and Pay) Act 2023 and are at risk of losing extra responsibility allowances if they have a child who spends time in neonatal care. Will the local government Minister issue guidance to councils, asking them to ensure that all parents are protected if their councillors find themselves in those most difficult of circumstances?

[Simon Hoare]

My hon. Friend has worked on this campaign. We spoke about it last week and I understand entirely the merits of the argument he makes. So powerful is he as an advocate that I have already put work in hand to deliver what he is talking about.

[Richard Foord (Tiverton and Honiton) (LD)]

On the community ownership fund, it is welcome that the match funding requirements for local organisations have been reduced to 20%. In future rounds, could the criterion around match funding take account of prior investment by the community, such as the very many small donations that people in the Axe valley area gave to build Seaton community hospital?

Local Government Finance Settlement Update

Simon Hoare Excerpts

Thursday 29th February 2024 Written Statements

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Simon Hoare)]

On 5 February, my right hon. Friend the Member for Surrey Heath (Michael Gove) set out the final local government finance settlement for England for 2024-25. The final settlement includes new funding for local authorities worth £600 million and makes available up to £64.7 billion for local authorities in England, an increase in core spending power of up to £4.5 billion, or 7.5% in cash terms—an above-inflation increase—on 2023-24.

As a result of this settlement, the vast majority of local authorities will be able to set balanced budgets in 2024-25 and continue to deliver vital services for their communities.

Members of the House will be familiar with the small number of local authorities with severe local failure, where the Government have had to step in and take the most serious action through statutory intervention. These authorities are Birmingham City Council, London Borough of Croydon Council, Liverpool City Council, Nottingham City Council, Sandwell Metropolitan Borough Council, Slough Borough Council, Thurrock Council and Woking Borough Council. The House receives regular updates on the progress of these interventions. In some of these cases, significant local failures in governance and financial management have resulted in acute financial failure, and these councils have asked the Government for continued support to help them set budgets including for 2024-25.

In addition, the Government have always stood ready to engage with local authorities who may request support on an exceptional basis due to local issues that they are unable to manage themselves. While those discussions are confidential, the Government are committed to making the details of any support that is agreed public, in the interests of transparency. Today, my Department is publishing on www.gov.uk details of in-principle capitalisation directions provided to a small number of these local authorities. I will deposit copies of any relevant documents in the Library.

Capitalisation directions permit a local authority, in specific and exceptional circumstances, to meet revenue costs through capital resources, enabling them to manage budget pressures over time—for example through the sale of council-held assets. They do not include any additional direct grant funding. At this stage, and in line with precedent, the Government have provided these local authorities in-principle support only, to ensure that they can set their 2024-25 budgets and deliver vital services for their communities.

In line with the usual framework for agreeing capitalisation directions, appropriate conditions will apply. These are intended to ensure that the process is only used in circumstances where it is truly necessary, address the drivers of the issues that have led to local authorities requesting support, and ensure continued progress towards achieving financial sustainability. In all cases, the Government expect these local authorities to take into account the need to reduce wasteful expenditure, and ensure every area is making best use of taxpayers’ money. Where statutory interventions are in place, any final agreement to support will be contingent upon the demonstration of ongoing improvement, transformation and recovery.

Where the Government have agreed to provide support, it is essential that appropriate assurance arrangements are in place. Where appropriate, any final agreement to support will be conditional upon the completion of rigorous external assurance reviews to assess, at a minimum, the local authorities’ financial management practices, and the production of improvement and transformation plans that focus on securing the local authorities’ medium-term financial position. The Government are taking additional action in the case of Plymouth City Council, which has requested a very significant capitalisation as a direct result of the incorrect accounting treatment of a transaction in 2019-20 through which the council borrowed to pay off a large part of its pension deficit. Given the unusual nature of Plymouth’s approach, the in-principle capitalisation is conditional on a thorough, independent investigation into the transaction.

I am clear that the Government will not hesitate to take action if needed to protect local taxpayers.

[HCWS300]

Draft Non-Domestic Rating (Rates Retention: Miscellaneous Amendments) Regulations 2024

Simon Hoare Excerpts

Wednesday 28th February 2024 General Committees

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Simon Hoare)]

I beg to move,

That the Committee has considered the draft Non-Domestic Rating (Rates Retention: Miscellaneous Amendments) Regulations 2024.

Mr Vickers, it is a pleasure to serve under your chairmanship this morning. I should begin by con-gratulating each and every one of you, the members of this Committee, for so annoying your Whips Office that you were appointed to this Delegated Legislation Committee. It is probably the most fun you will have today. If this was not on the Committee’s bucket list, I do not know what was.

I detect that there is no sign of a division between the two Front-Bench teams today. I could dilate at some length about the business rates retention scheme. I am of course happy to take Members’ questions. I am inclined to say that these proceedings are a piece of housekeeping, which has to be done because it has to be done.

I apologise to colleagues who have, tantalisingly, controlled their expectation of serving on this Committee on at least one occasion, when we had to withdraw it. Let me explain: I will carry the blame for this. There was, in one bit of the formula, a misplaced bracket. Never in the history of misplaced brackets has so much potential disaster been averted by putting it in the right place. On the second occasion, we had the peculiar problem whereby we made the judgment of leaving a blank space where there was no data to put in, only to be advised by somebody or other in the House that that could be frightfully confusing, and that therefore adding a zero to confuse the mind still further was an important thing to do.

The business rates retention scheme is governed by seven principles. Those are set out in the regulations. This is helpful to local government and helpful to business. I could detain the Committee for a very long time reading the wonderful piece of Shakespearean prose that has been put before me. I read it in bed last night, and I have never had a better night’s sleep, having woken up with my box on my lap. Given that it is a technical, housekeeping point, and given that, amongst others, myhon. Friend the Member for Weston-super-Mare has always advised me that the most popular Minister is the one who spends the least time discussing non-contentious, technical, housekeeping issues—echoed by my hon. Friend the Member for Copeland (Trudy Harrison)—I commend the regulations to the Committee.

[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

It is a pleasure to serve under your chairmanship, Mr Vickers, and to attend the Committee this morning. I am happy to confirm that the Opposition do not wish to divide the Committee on this matter, which we believe to be technical. Very much in the spirit of the Minister, I do not propose to go into a lot of detail, but it is important to say that business rates retention is a fundamental foundation stone of many devolution deals that have been agreed. The thrust towards devolution is not just about devolving power; it is also about devolving fiscal responsibility, and enabling areas to benefit from growth in that local area. However, any system of course needs floors and ceilings, to ensure that councils can afford to run their services. That is what this technical instrument is about.

As the Minister says, there has been a delay in tabling. I accept that stray brackets and commas and zeroes play some part in this—we have all had that experience in the past—but it is a matter of fact that we are now four months on from when we expected the instrument to be tabled, so it is legitimate to ask, have there been any financial winners or losers during that time, and will the Government compensate on that basis?

[Simon Hoare]

I can assure the hon. Gentleman that no one has disproportionately won or disproportionately lost. This is timely. It was a singular bracket that was misplaced, rather than a pluralised bracket; I can assure him of that. Every comma was in the right place, ditto semi-colons. Nobody has had extra money that now has to be clawed back, and nobody has had less money which we then have to dole out.

[Jim McMahon]

That is a fundamental point and I am grateful for that early clarification. In that spirit I do not want to give advice—indeed, I am not strictly qualified to give advice to others—but I will say, in the spirit of statutory instruments of this nature, that perhaps not allowing the good to be the enemy of the perfect means that we can get through some of this process a bit more quickly and give local authorities the certainty that they need in order to ascertain their financial position.

[Simon Hoare]

I know this sounds bonkers, but if we had proceeded with the SI with the bracket in the wrong place, it would have led to miscalculations of the sums that we are talking about. So we made a judgment that this was not an arcane case of the perfect defeating the good; this was a rather important decision to take. We did not take it lightly, but we thought it better from local authorities’ perspective to get it right, rather than having to come back and ask for extra money, or dole out extra money, thereby sowing the seeds of confusion.

[Jim McMahon]

My final question for the Minister in his winding-up speech will be to ask where the Government are up to on the wider reset of business rates that the sector is waiting for.

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Simon Hoare)]

I am grateful to the members of the Committee for the forensic dissection of this piece of legislation. Let me answer the outstanding question from my good friend, my shadow. In due course, the way in which local government is funded, both from council tax subvention and from business rates, will have to be reviewed, and it will have to be done in the round. I think the hon. Gentleman is on exactly the same page on that. There is an opportunity for cross-party working, to give the sector, in the widest sense of that definition, the greatest possible security and certainty.

To conclude, this is a highly technical set of regulations. They are necessary to ensure that the rates retention scheme continues to operate as it should and as we would like it to. I hope and believe that the Committee will join me in that assessment.

Question put and agreed to.

Resolved,

That the Committee has considered the draft Non-Domestic Rating (Rates Retention: Miscellaneous Amendments) Regulations 2024.

Local Government Stewardship Update

Simon Hoare Excerpts

Thursday 22nd February 2024 Written Statements

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Simon Hoare)]

All hon. Members will recognise the critical role local councils play in providing essential statutory services to their residents and being accountable to the communities they serve. Where councils do not meet the high standards that we set for local government, it is right that the Government intervene in order to protect the interests of residents. Today I am informing the House of a best value inspection of the London Borough of Tower Hamlets, confirming the final decision to appoint commissioners to Nottingham City Council and providing an update on the existing statutory interventions in Slough Borough Council and Birmingham City Council.

London Borough of Tower Hamlets

It is a matter of public record that the London Borough of Tower Hamlets was subject to statutory intervention under section 15 of the Local Government Act 1999 between December 2014 and September 2018. This followed an inspection by PricewaterhouseCoopers LLP, and an inspection report published in November 2014, which identified best value failure, particularly in relation to grant making, property disposal and publicity spending. As the then Secretary of State, my noble friend Lord Pickles, noted when initiating that intervention on 4 November 2014:

“The abuse of taxpayers’ money and the culture of cronyism reflects a partisan community politics that seeks to trade favours and spread division on the rates. Such behaviour is to the detriment of integration and community cohesion in Tower Hamlets and in our capital city.”—[Official Report, 4 November 2014; Vol. 587, c. 666.]

It is also a matter of public record that Mayor Rahman and his agent, who was also the cabinet member for resources, were found to have been guilty of election offences by an election court in 2015 and were banned from standing for elected office for five years, and that the conduct of making grants amounted to the corrupt practice of bribery under section 113 of the Representation of the People Act 1983.

Commissioners were withdrawn and functions returned in March 2017 on the condition that the council continued to achieve against its best value plans and report regularly to the Secretary of State on its ongoing compliance with the best value duty. In June 2018 a Local Government Association (LGA) corporate peer review concluded the authority was now “on a positive trajectory” but that to continue to improve, it must

“be forward looking and learn the lessons of the past”.

Following that peer review and recognising the role of the then Mayor and chief executive in providing leadership to drive change, Ministers took the decision to end the intervention in September 2018.

It is clear to me that the council has made significant progress in the past years to improve governance and assurance processes. A recent corporate peer challenge by the LGA highlighted a range of areas in which the council does very well. These include strong relationships with statutory partners and that the council knows its places well. However, some recent changes have the potential to undermine the improvements that allowed the previous intervention to end. These changes include significant churn at the senior management level, which has resulted in a number of interims in the senior management of the council; the use of policy advisers and expansion of the mayoral office, which has reportedly resulted in the creation of a “two council culture”; the review of the constitution; changes to the grant regime, given the election court judgment of 23 April 2015 and the improvements put in place by commissioners previously; weaknesses in the scrutiny function; the decision to bring some services in house and the need to realise substantive savings in the short term. While the Mayor has a clear democratic mandate, and change to the way the council is organised to deliver priorities is not itself a cause for concern, given the history of the council, changes made to arrangements that were necessary to ensure compliance with the best value duty could mean that compliance is now at risk.

To support the council to continue to make arrangements to secure improvement in its governance arrangements and other areas linked to the past intervention, I am clear that the Government require direct independent assurance that the London Borough of Tower Hamlets is compliant with its best value duty. Therefore, I am today informing the House that the Secretary of State has exercised the powers granted to him by Parliament under section 10 of the 1999 Act, to appoint Kim Bromley-Derry CBE DL as lead inspector and Suki Binjal, Sir John Jenkins and Philip Simpkins as assistant inspectors to carry out an inspection of the council’s compliance with its best value duty.

The inspection will occur in relation to specified functions where we have concerns. This includes the council’s functions under part 1 of the Local Government and Housing Act 1989, section 151 of the Local Government Act 1972, and the strength of associated audit and scrutiny arrangements, with particular attention to potential changes to constitutional arrangements, budgetary proposals and medium-term financial planning, the appointment of senior management posts, the use of policy advisers, the expansion of the mayoral office, the policy and practice of grant making, functions that relate to the appointment and removal of an electoral registration officer and returning officer, the funding of electoral registration and local elections work, the use of resources for elections and the maintenance of the independence of the returning officer, and the arrangements to bring services in house, such as Tower Hamlets Homes and leisure services. Given that our concerns also relate to wider decision-making functions, and whether expectations for effective and convenient local government are being met, the inspection will also consider decision-making in relation to those functions, encompassing leadership, governance, organisational culture, use of resources and impact on service delivery.

The lead inspector has been asked to report findings by 31 May 2024, or such later date as may be agreed.

Once the inspection is complete, we will carefully consider the inspection report. If it shows that the council is in breach of its best value duty, we will then consider whether or not to exercise powers under section 15 of the 1999 Act.

This action is not undertaken lightly, and my Department is committed to providing the council with whatever support it may need to support compliance with its best value duty. I will update the House in due course.

Nottingham City Council

On 13 December 2023, I announced to the House that the Secretary of State was “minded to” appoint commissioners to take over certain functions at Nottingham City Council. Commissioners would replace the existing improvement and assurance board, chaired by Sir Tony Redmond, with immediate effect. I also announced that the commissioner team, if appointed, would consist of three appointments: a lead commissioner, a commissioner for finance, and a commissioner for transformation.

These proposals followed the evidence provided in Nottingham City Council improvement and assurance board’s latest reports, also published on 13 December, which included the board’s assessment that the council is still not acting at the required pace to make the necessary improvements; and the council issuing, on 29 November 2023, a section 114 notice due to an inability to balance the budget for 2023-24. The Secretary of State concluded that the council is continuing to fail to comply with its best value duty. He was minded to escalate the current intervention arrangements in order to secure compliance with that duty and to ensure that the necessary improvements are made at pace for the benefit of the local community.

I invited representations by 2 January 2024 on the intervention package proposed in December from the council, and any other interested parties, especially the residents of Nottingham. The Secretary of State and I have now received the representations on his proposals, which we have considered carefully.

We received a total of 70 representations, including from the authority, the Nottingham Labour group, 16 Labour councillors, local MPs, 35 from members of the public, four local businesses, two community leaders, Unison and eight partner organisations.

The representations presented a mixture of support and opposition for the proposals to appoint commissioners. The representation from the council made clear its preference for retaining the improvement and assurance board, but stated that it will co-operate with commissioners if appointed and noted the proposed commissioner team. It requested that any decision to appoint commissioners is taken expeditiously and that a smooth transition is ensured.

Having considered carefully all of the representations received, and all other developments since the “minded to” decision, the Secretary of State and I are satisfied that no further issues have been raised which were not known at the time we made the “minded to” decision and that no change is warranted to the position outlined in that “minded to” decision. The Secretary of State is satisfied that Nottingham City Council is continuing to fail to comply with its best value duty, and that the necessary improvements are still not being made quickly enough. I am today confirming that commissioners have been appointed to Nottingham City Council and new directions have been issued.

The Secretary of State, as proposed in December, has decided to appoint three commissioners: a lead commissioner, a commissioner for finance, and a commissioner for transformation. This team structure reflects the most pressing priorities at the council as highlighted in the improvement and assurance board’s latest reports, namely weaknesses in finance and transformation, along with an underlying culture of poor governance. The Secretary of State is today appointing individuals to the roles of lead commissioner and commissioner for finance. The chosen commissioners have a proven record of leadership, finance, transformation and strong governance, together with the specific expertise relevant to their functions. We will appoint a commissioner for transformation in due course.

Tony McArdle OBE (lead commissioner) has extensive experience in local government and is the former chief executive of Lincolnshire County Council, and Wellingborough Council. Tony has experience in multiple interventions and best value roles, including as current chair of the London Borough of Croydon improvement and assurance panel, former lead commissioner at Northamptonshire County Council, and best value inspector at Thurrock Council.

Margaret Lee (commissioner for finance) previously worked at Essex County Council where she held the posts of section 151 officer and executive director for corporate and customer services for 13 years. Margaret also has experience of interventions and best value roles, including as former finance commissioner at Slough Borough Council, finance lead on the London Borough of Croydon improvement and assurance panel, and best value inspector at Thurrock Council.

The commissioners have been appointed for two years, or such earlier or later time as the Secretary of State determines. The Secretary of State is clear that the directions should operate for as long, and only as long, and only in the form, as necessary. The Secretary of State and I wish to again place on record the instrumental role the improvement and assurance board, under Sir Tony Redmond’s leadership, has played in Nottingham City Council’s improvement journey to date. Indeed, the current situation would be even more challenging without their dedication and sustained efforts over the past few years. Commissioners are today replacing the board with immediate effect. The Secretary of State and I are clear that we expect a managed transition from the improvement and assurance board to the commissioners and that momentum is not lost, particularly over the critical budget setting period for 2024-25. We are supportive of the commissioners drawing on reasonable support to facilitate this transition, including from the former board members, if they wish and in the terms they deem reasonable.

The commissioners will be asked to provide their first report within the next six months. Further reports will be provided every six months, or as agreed with the commissioners.

As with other interventions led by my Department, the council will be directed to meet the costs of the commissioners, along with such reasonable amenities and services and administrative support as the commissioners may reasonably require. The fees paid to individuals are published in appointment letters which are available separately on gov.uk. I am assured this provides value for money given the expertise that is being brought, and the scale of the challenge in councils requiring statutory intervention.

Slough Borough Council

Slough Borough Council has been in intervention, with commissioners appointed, since 1 December 2021, after an external assurance review found the council had failed to meet its best value duty. Following the commissioners’ first report on 9 June 2022 the intervention was expanded on 1 September 2022. The intervention is due to end on 30 November 2024, though we have always been clear that the Secretary of State may decide to extend directions beyond this date, or that it may be appropriate to return functions before this time.

When I last updated the House on 14 September 2023 on the commissioners’ third report, it was clear that while progress was being made and there was cautious optimism that the council was moving in the right direction, there were still significant challenges. It was vital that the council accelerated the pace of improvement to make substantial changes in the months ahead.

I am sorry to report that while the fourth report submitted to the Secretary of State on 17 January 2024 does record continued progress in some areas, including the political leadership, children’s social care and special educational needs and disabilities (SEND), procurement and contract management, the pace of improvement has been insufficient and inconsistent given the stage of the intervention, and there is still a lot to do before the council will meet its best value duty.

It is of concern that the council has not accelerated the pace of improvement, especially on tackling organisational transformation and developing a future operating model, and continued financial instability remains a concern. Commissioners are now of the opinion the Government need to consider the nature of the intervention beyond the current timelines. I have today written to commissioners to request a further assessment of progress in April 2024 to allow the Secretary of State and I to decide whether further intervention is required beyond November 2024. That report will need to cover:

An assessment of continued best value failure including progress against each of the directions and against the best value themes published for consultation by DLUHC last summer;

A view on timeframes needed for the authority to deliver its best value duty;

Whether the current directions are sufficient and necessary for the authority to meet its best value duty.

In the immediate term, it is essential that the council demonstrates fresh resolve in implementing the changes required to deliver a sustainable council that the residents of Slough deserve.

I will update the House on further progress with the intervention and next steps at that time.

Birmingham City Council

The Government intervened in Birmingham City Council in October 2023, and in January the commissioners wrote to the Secretary of State to set out their initial findings and progress of the intervention. I am today publishing that letter. The financial challenges facing the council are acute and, while it is encouraging that commissioners have made early progress, the situation is worse than they had initially expected. It is vital that the council continues to listen to, and work with, commissioners to ensure their savings plans are delivered to achieve a balanced budget for 2024-25 and beyond. The financial implications of the failed implementation of the Oracle system and the potential equal pay liability also remain a significant challenge. Commissioners have my full support in taking whatever steps are necessary to drive the required improvements. I expect to see demonstrable progress from the council in the commissioners’ first full report, which is due in the spring, and I will update the House on further progress with the intervention and next steps at that time.

Conclusion

I want to acknowledge in today’s announcement the work of the dedicated staff who deliver the important services of councils on which local residents depend. I also want to thank the commissioners for all they do. I will deposit in the Library of the House copies of the appointment letters for the Tower Hamlets inspectors, the appointment letters for the Nottingham City Council commissioners together with the directions and accompanying explanatory memorandum, and the report and letter I have referred to, which are also being published on www.gov.uk today.

[HCWS280]

Returning Officer Indemnities

Simon Hoare Excerpts

Wednesday 21st February 2024 Written Statements

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Simon Hoare)]

For the purposes of police and crime commissioner and UK parliamentary elections and recall petitions, returning officers and petition officers are statutorily independent officers and are separate from both central and local government. As a result, they are personally liable for the conduct of the elections. It is therefore necessary for the Department of Levelling Up, Housing and Communities to indemnify police area returning officers and local returning officers in England and Wales against uninsured claims that arise out of the conduct of their duties in PCC elections. It is also necessary to indemnify returning officers or acting returning officers in England, Scotland and Wales against uninsured claims that arise out of the conduct of their duties during UK parliamentary elections and petition officers in respect of recall petitions.

Local authority officers acting in the role of returning officer and similar statutorily independent offices when running polls have traditionally had arrangements which insure them against any risks they face in taking forward their statutory duties at local elections and which may also cover UK parliamentary elections. The cover obtained usually forms part of the local authority’s own insurance arrangements. While this insurance may also cover some risks to which the returning officers and petition officers may be exposed at PCC and UK parliamentary elections and recall petitions, they could be liable for claims of a type not covered by those insurance policies. They could also be liable for claims that exceed the insurance limits in their existing cover. Hence the Government have provided an indemnity to ensure they have effective cover and which can be called on where insurance is not available or inadequate.

The existing indemnities for PCC and UK parliamentary elections run out on 1 May 2024. The existing indemnity for recall petitions runs out on 6 May 2024. Considering this, DLUHC proposes to continue to provide police area returning officers and local returning officers with a specific indemnity for the forthcoming PCC elections on 2 May 2024. Separate indemnities will also continue to be provided for returning officers and acting returning officers at UK parliamentary elections and petition officers in relation to recall petitions. The indemnities for PCC, UK parliamentary elections and recall petitions will indemnify against claims that arise out of the conduct of the relevant officer’s duties where existing insurance cover does not apply. The renewed indemnities will cover costs arising in relation to PCC elections where the date of the poll is on or before 2 May 2028, and for UK parliamentary elections and recall petitions where the date of the poll is on or before 2 May 2029.

Where a relevant returning officer already holds insurance which covers liabilities incurred at a PCC, UK parliamentary election, and recall petition they will be required to claim under that insurance—or to seek to claim under it—before making a claim against the relevant indemnity. Insurance for specific elections has historically provided extremely poor value for money, with claims made under such cover being smaller than the cost of the insurance premium. An indemnity therefore provides better value for money and this approach has been taken for elections since 2009. The indemnities will be limited to the extent set out in the departmental minute. The indemnities are subject to exceptions identified in the minute but are unlimited in terms of the maximum amount covered per claim. If the liability is called, provision for any payment is to be met from the consolidated fund.

On this basis, I have today laid a minute setting out DLUHC’s intention to extend the current arrangements which indemnify the relevant returning officers and petition officers against claims that arise out of the conduct of their duties in relation to PCC elections, UK parliamentary elections, and recall petitions.

Regarding the process of renewing indemnities, since 2009, the Minister concerned has presented a departmental minute to Parliament giving particulars of the liability created and explaining the circumstances, and has refrained from incurring the liability until 14 parliamentary sitting days after the issue of the minute, except in cases of special urgency. HM Treasury has approved the renewal of these indemnities. However, following further discussion with HM Treasury, it has been agreed that, in line with the contingent liability approval framework, the renewal of indemnities now qualifies as part of Government’s “normal course of business”. This means that any future renewal of indemnities will not require HM Treasury’s consent or future notification of Parliament.

[HCWS275]

Local Government Finance

Simon Hoare Excerpts

Wednesday 7th February 2024 Commons Chamber

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Simon Hoare)]

It is a pleasure to wind up for the Government in this debate. I will just say gently to one of my shadows, the hon. Member for Blaydon (Liz Twist), that if the situation is as bad as she and the hon. Member for Oldham West and Royton (Jim McMahon) have painted it, I am surprised that with the exception of those on the Front Bench and the hon. Member for Sheffield South East (Mr Betts)—I know, as a former Select Committee Chairman, that one is obliged to take part in these debates when they relate to one’s Department—we have, against all this horror, had only one Labour Back-Bench contribution. I thank and congratulate the hon. Member for York Central (Rachael Maskell)—at least there is one Labour Member who is concerned about local government and who is not obliged to come and talk about it.

What an exciting prospect we have—the nation sits agog! After 14 years of opposition, a review to look at long-term plans is what the hon. Member for Blaydon tantalisingly holds before the House and the electorate. After 14 years of opposition, one has to ask what on earth they have been doing with the time. A review to look at long-term plans! As always, the Labour party is quick to critique and slow to deliver. What a contrast to the speeches we have heard from Conservative Members.

[Mr Betts]

I take the Minister back to the beginning of the debate, when the Minister for Housing, Planning and Building Safety talked about doing a long-term review of local government finance in the next Parliament. The difference, of course, is that the Government have been in power for the last 14 years and could have done something about it.

[Simon Hoare]

The hon. Gentleman and I have discussed this on many occasions, and I know he broadly agrees with me on this point. Local council chief executives and leaders would have come at the Department with pitchforks and flaming torches if we had dumped a 200-page consultation document on their desks at a time when they were rallying to support their communities during the covid crisis.

This year, as last year, the Government have rightly set our focus on stability, certainty and security. I believe this local government finance settlement delivers on all three.

[Richard Foord]

Will the Minister give way?

[Simon Hoare]

No. If the hon. Gentleman is not here for the opening, he cannot take part in the summing up. He has tried that trick before, and it did not work then.

As we heard from the hon. Members for North Shropshire (Helen Morgan), for Sheffield South East and for Blaydon, some of these issues came through in the consultation and in the engagement: support for special educational needs; a long-term view of adult social care; and reform to the funding formula, which so many hon. and right hon. Members have referenced. A reformed funding formula would provide stability and security to our local authorities, and the best way to deliver it is through cross-party working. That is what this House owes them.

When I was asked to take on this job, I had no idea of the complexity and time required to arrive at a local government finance settlement. I thank all colleagues who came along to take part in my parliamentary engagement, which was hugely helpful. I pay tribute to my private office and to officials in the Department—long hours, huge work. I pay particular tribute, not least because her note tells me I have to, to Victoria Peace for all her hard work, as well as to Kate, Nico and others. It has truly been a team effort.

I also thank the Chancellor of the Exchequer and the Prime Minister for listening to the case that the Secretary of State and I took to them on revising the formula. We said that we would listen, we did and we have acted. Those are the hallmarks of prudent, listening, caring, one-nation conservativism, and it is writ large in this local government finance settlement.

I also pay tribute, as so many others have, to the work that councillors and council officers do, day in and day out, to deliver to make the lives of some of the most vulnerable people in our society more bearable and a little better, and to create a sense of place in which people wish to live. We salute all of them. Are all of them brilliant? Of course not, but not all of us are brilliant either. But I know that, day in and day out, they focus on doing their best.

I have been called many things, but the hon. Member for Sheffield South East called me “genuinely helpful”. My hon. Friend the Member for West Dorset (Chris Loder) called me “the great rural tsar” and a “knight in shining armour”. And my hon. Friend the Member for St Austell and Newquay (Steve Double) called me a “warrior” for rural councils. I am grateful for those comments, and I look forward to their being carved into my headstone in due course.

[Mr Betts]

Not too soon.

[Simon Hoare]

Not too soon, I hope.

I could bore the House with the figures for the local authorities of each Member who has contributed, but those figures are on the public record. They are all going in a positive direction. I think we have started to make significant inroads into addressing those concerns, by turning our thinking to the common themes that have ranged through this debate. The trajectories on SEND and adult social care show no sign of abating, and we need a long-term solution. The formula does need reforming and the Government are committed to doing just that in the next Parliament.

I say to everyone that the transformation and productivity plans, which we see as a key part of the settlement, are all part of underscoring that “Agenda for Change” is a process, not an event; it has to be iterative and organic, because, as my hon. Friend the Member for St Austell and Newquay mentioned, we have no money and councils have no money save that which we raise through the taxpayer. We have a duty to ensure that we deliver the biggest bang for each and every buck.

My hon. Friends the Members for Hastings and Rye (Sally-Ann Hart) and for West Dorset, the hon. Member for Somerton and Frome (Sarah Dyke), and my hon. Friends the Members for Loughborough (Jane Hunt) and for Waveney (Peter Aldous) all made important points about how the formula review must ensure that we take into account the differentials in the demand of need in delivering services in a rural or coastal area. I do not believe that we would be right in any definition of the term to say that “need” in an urban area outranks that in a rural or coastal area, or vice versa. Need is need and our local authorities want to play their part in making a difference on that. My hon. Friend the Member for Loughborough was not the only one, but she was right to mention the need for other Departments, when they create a new burden or duty on local authorities, to take into account the budgetary impacts that those services have, and I certainly take that on board. My hon. Friend the Member for Hastings and Rye made that point as well and I agree with all who have made it.

The hon. Member for York Central asked a specific question about the flood recovery framework and business rates. I am delighted to confirm to her that 100% business rate relief is available to business for a minimum of three months where they have been flooded and that that relief can continue to an agreed date until the business is able to be reoccupied for trading. I hope that that gives some comfort to her and to her constituents who have suffered from flooding issues in the recent time.

A lot has been done, services can continue, but the need for reform, cross-party working, blue skies thinking and significant change remains. This settlement is a generous one, with more than half a billion pounds or, I should say, “just” half a billion pounds, available for children’s services and adult social care. My hon. Friend the Member for West Dorset has long advocated for the rural services delivery grant and that is up now to its highest level, at £115 million. I know that rural councils, including that of the hon. Member for North Shropshire, will have welcomed that as a useful means of supporting their services.

We understand, applaud and appreciate the important contribution that councils make across our country, and the difference they deliver for their communities. We understand and are going to work with the sector, sector leaders, council leaders and others to ensure a bright, secure and stable future for local councils. We are providing a £600 million uplift, and, on average, a 6% to 7% increase in core spending power for most councils. This is a fantastic opportunity for councils to continue to deliver and for us to support them. I close with the point that many have made: we will deliver better for our constituents when central and local government work in partnership, matched horses pulling in the same direction, serving our communities and making a vital difference for those who need it. I commend the settlement to the House.

Question put and agreed to.

Resolved,

That the Local Government Finance Report (England) 2024–25 (HC 318), which was laid before this House on 5 February, be approved.

Resolved,

That the Referendums Relating to Council Tax Increases (Principles) (England) Report 2024–25 (HC 319), which was laid before this House on 5 February, be approved.—(Simon Hoare.)

Resolved,

That the Referendums Relating to Council Tax Increases (Alternative Notional Amounts) (England) Report 2024–25 (HC 320), which was laid before this House on 5 February, be approved.—(Simon Hoare.)

Business of the House (Today)

Ordered,

That, notwithstanding the provisions of paragraph (14) of Standing Order No. 80A (Carry-over of bills), the Speaker shall put the Questions necessary to dispose of proceedings on the Motions in the names of:

(1) Secretary Michelle Donelan relating to the Data Protection and Digital Information Bill: Carry-over extension; and

(2) Secretary Alex Chalk relating to the Victims and Prisoners Bill: Carry-over extension not later than one and a half hours after the commencement of proceedings on the Motion for this Order; such Questions shall include the Questions on any Amendments selected by the Speaker which may then be moved; proceedings may continue, though opposed, after the moment of interruption; and Standing Order No. 41A (Deferred divisions) shall not apply.—(Penny Mordaunt.)

Blackpool: Regeneration

Simon Hoare Excerpts

Thursday 1st February 2024 Commons Chamber

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Simon Hoare)]

I thank the hon. Member for Blackpool South (Scott Benton) for his speech, and for raising this important issue. I will start where he ended, by referring specifically to his words on Waterloo Road and Bond Street. I assure him and his community that Homes England and the council are working closely to find the best possible opportunities in the town for regeneration. I think he will agree— I hope he will—that the local council, with all its local knowledge and understanding, is clearly the best placed organisation to speak to specific plans, but I reassure him of our ambition to level up and secure the lasting change for Blackpool for which he has advocated since he came to this place in 2019.

I appreciate the hon. Gentleman’s patience, and that of the community that he represents, in awaiting further news. Let me reassure him that I fully recognise how important the project is for Blackpool. It continues to be a priority for my Department. I will of course discuss the issue with the Under-Secretary of State for Levelling Up, Housing and Communities, my hon. Friend the Member for Redcar (Jacob Young), and collectively we will do all that we can with the Treasury to press the case that the hon. Gentleman has made today. I wanted to get those specifics on the record for him.

Let me now say a few words about Blackpool. The hon. Member for Blackpool South does not need me to tell him that it is a town of incredible strength and resilience, allied with enormous potential. Blackpool’s tourism economy alone is worth more than £1.4 billion, supporting in excess of 20,000 jobs. Replying to this debate has reminded me, with a tinge of emotion, of a very enjoyable boyhood holiday that I had with my grandmother in Blackpool. My memory is a little hazier, for reasons that I really cannot recall, with regard to attendance at successive Tory party conferences. It must be something to do with the air that makes the mind a little fuzzy. Of course, the famous scene of Rita Fairclough and Alan Bradley, beaming Blackpool into the sitting rooms of millions of our fellow citizens, left an indelible impression on so many minds—hopefully encouraging people to use the trams, but to be a little careful when alighting from them.

The hon. Gentleman’s speech and work has rightly reminded us that Blackpool should not be seen just as a holiday and tourist destination, as delightful as that is, and as important as it is for the economy. It is home to many businesses and thousands of people, with all their linked housing, education, and health service needs, together with their aspirations for hope, job security, economic growth and a better life for their children. It has been restrained for too long by some deeply rooted societal challenges in health, in housing and in skills and diverse investment, and the hon. Gentleman set out some of those in his remarks. He made the case, as he always does, for the pressing need for regeneration, and the dramatic statistics he used to underpin his argument only served to illuminate that point still further.

That is why the Government have been working in partnership with local leaders to level up the town. I was grateful to the hon. Gentleman for referencing the investment of around £400 million in the town since the Government took office. That is a phenomenal level of investment, and I hope it speaks to the faith and confidence that this Government have in the whole of the north of England and in Blackpool in particular. We support their vision to make Blackpool better, a leading UK tourism destination and a brilliant place in which to live and work, with improved jobs, housing and skills.

We are committed to working in partnership with Blackpool Council to boost opportunity and restore local pride through levelling up housing and living standards and restoring pride of place. Blackpool has received more than £100 million of levelling-up funding alone since 2019, as well as investment helping to unlock a major £300 million development, as the hon. Gentleman said. That included £40 million from round 2 of the levelling-up fund to create that important state-of-the-art learning centre for more than 1,000 people, the Multiversity, which will replace the ageing Blackpool and the Fylde College facilities with new state-of-the-art facilities in the town centre. Another £15 million from round 3 of the fund will improve traffic flow, access to public transport and infrastructure for cyclists and pedestrians—all key arteries and routes to see people moving across their town, visitors moving freely, jobs being created and business being done.

As the hon. Gentleman knows, the town is benefiting from just shy of £40 million of investment from the towns fund, which is being spent on a host of job creation and tourism-boosting projects. He will know that that includes rejuvenating the famous Blackpool illuminations—and they are indeed famous—to attract more visitors to the town in the usually quiet autumn and winter period. It is the unique selling point of Blackpool to have that marvellous attraction in those darker months of the year. I know the hon. Gentleman’s love of football, so of course I must mention the creation of a new sports village, which combines leisure, education, and residential facilities, while helping to address health deprivation and wellbeing and providing much stronger links with Blackpool Football Club.

The town is also benefiting from the wider Lancashire devolution deal, announced in the autumn statement by the Chancellor, through which £20 million will be provided to Lancashire Combined County Authority, along with a further £1 million to support the authority in the early stages of the deal. The adult education budget will also be devolved as part of the deal—this Government once again trusting local decision makers and local community leaders to help shape the place that they want their people to live in.

As the hon. Gentleman has referenced, housing is a key focus of the partnership working between Government and Blackpool. I thank him again for setting out the opportunities for regeneration in Waterloo Road and Bond Street, which are indeed interesting and exciting. If we are to truly achieve our shared levelling-up ambitions for Blackpool, we must ensure that there is as wide a range as possible of quality homes across different tenures. To unlock Blackpool’s immense economic potential, we want to see more homes, safer homes, better homes, in well-designed neighbourhoods that will help to attract and retain skilled residents in the town.

Part of our approach is through legislation—the Renters (Reform) Bill, which will apply decent homes standards to the private rented sector for the first time. This will ensure that tenants benefit from homes that are safe and decent, and will support the Government’s ambition to reduce the number of non-decent rented homes by 50% by 2030—and one hopes that we will exceed that target. We know, of course, that the majority of landlords already provide decent housing and a good service for their tenants, but there is always room for improvement. The decent homes standard will help landlords by simplifying and clarifying requirements, and establishing a level playing field, backed up by consistent enforcement.

As the hon. Gentleman will know, we are running a pilot for the decent homes standard in Blackpool to improve standards in areas that are in greatest need, as part of our mission to halve the number of non-decent homes by 2030. The Under-Secretary of State for Levelling Up, Housing and Communities, my hon. Friend the Member for Redcar, was in Blackpool in January, when he had the opportunity to see some of the fantastic work being undertaken locally, with Government support, to improve the standards of homes in the town.

Physical regeneration of the built environment is vital if we are to truly level up Blackpool. As the hon. Member for Blackpool South is aware, my Department, alongside Homes England, has been working closely with the council to develop transformational plans to improve the quality of housing. I hope that we will be able to say more about that in due course.

The hon. Gentleman has advocated so strongly for his town, as he always does. He need not convince me—he preaches to the choir, if you like—that Blackpool has incredible potential. I am proud of the work that this Government are doing, in partnership with local leaders and with him, to level up the town. I thank him once again for raising this important issue.

Question put and agreed to.

Financial Distress in Local Authorities

Simon Hoare Excerpts

Thursday 1st February 2024 Commons Chamber

[Mr Betts]

I thank my hon. Friend for that question. Yes, it certainly is doing so. I have just produced a report about local government audit. There is a real problem there. If accounts have not been audited for three years, as in most cases, but probably longer in other cases, how on earth do we know what is happening in local council finances? Certainly, getting local audit on an even keel by the end of this year is very important, but where accounts are qualified, as they will be, councils should not be blamed for that; it is the problem of the local audit system, and we really must sort that out.

[The Parliamentary Under-Secretary of State for Levelling Up, Housing and Communities (Simon Hoare)]

On behalf of the Government, I thank the Chair of the Select Committee and all his colleagues on it for the work that they do in general, and for the report in particular. I will obviously study it with great care, and respond in the usual way. He made a number of points. I think we can all agree that certainty and security for the local government sector are important, and I concur with his view that there is clear merit in multi-year settlements. I also agree that whoever is standing at the Dispatch Box in the role of local government Minister after the next general election—I pray to God that it will be me, and I hope that my prayers will be answered—reforms will always be difficult and complex. I would be interested to know whether the hon. Member for Sheffield South East (Mr Betts) sees any merit in establishing some cross-party working and blue-sky thinking on the issue, in order hopefully to land something that can deliver certainty and security for five, 10, 15 or 20 years ahead, to give comfort to local government leaders, section 151 officers and others.

[Mr Betts]

While I might not completely agree with the Minister’s prayers, I agree that if we are to sort this out for the long term, particularly social care funding, we need a system that has general support. The Committee has called for that in the past. What we did on pensions reform a few years ago, cross party, has stuck, so there is merit in that suggestion. Whether we can achieve it, I do not know, but we ought to try.

[Mr Deputy Speaker (Mr Nigel Evans)]

I thank the hon. Member for her point of order and her forward notice of it. Clearly, the Chair is not responsible for the accuracy of Ministers’ remarks, but at the same time we want them to be accurate. I hope that those on the Treasury Bench have heard what she has had to say, and will ensure that the Secretary of State has it brought to his attention. At the same, given that she is a diligent Member of Parliament, I am sure that she will bring it directly to the notice of Ministers.

[Simon Hoare]

Further to that point of order, Mr Deputy Speaker. I have heard what the hon. Lady said. It is a serious point. I will ensure that my officials raise it with the office of the Secretary of State this afternoon to ensure that the situation is clarified. It is a sensitive issue, and her constituent and others will want to have clarity.

[Mr Deputy Speaker]

I cannot do it quicker than that, can I?