Ministry of Housing, Communities and Local Government

Vikki Slade Excerpts

Tuesday 24th June 2025 Commons Chamber

[Vikki Slade (Mid Dorset and North Poole) (LD)]

I refer Members to my entry in the Register of Members’ Financial Interests, as I am a councillor on Bournemouth, Christchurch and Poole council.

Local government funding is in crisis, from social care to special needs, homelessness to high streets. Our councils—whose work impacts us all and who are the backbone of local service delivery—are being pushed to the brink. While the estimate sounds positive, it is way more complicated, just like the work that councils do. The lack of funding is not a new problem. The hollowing-out of local government has been happening for a decade. In my home councils of BCP and Dorset, central funding through the revenue support grant was slashed by between 95% and 98% over that time. The Government’s announcement that central funding for councils with low tax bases will be weighted sort of misses the point. Many councils in the south receive no revenue support grant and are already raising their council tax by the maximum 5% each year. The Government need to talk to the councils they are targeting and review this proposal before they create a new problem.

Local areas are dealing with ageing populations and soaring house prices, and councils risk having no choice but to take money directly from services for the poorest, sickest and most vulnerable. The three-year settlements are welcome to help planning, and the headline £13.5 billion increase in Department funding by 2028-29 sounds positive, but measured against 2025-26 it is actually a real-terms cut of 0.6%. While MHCLG’s day-to-day spending will rise by £2.5 billion, much of this comes through transfers. For example, much of the £857 million for adult social care is reallocated from children’s social care, and the £515 million to cover increased national insurance contributions does not cover the demand.

Adult social care is now the largest spending area for upper-tier authorities. Meanwhile, tensions between the NHS and councils over who funds the sick and elderly are growing, leaving families stuck in the middle. Carers bear the brunt, often being forced to choose between caring and working, which has knock-on effects on the wider economy and carers’ wellbeing. The situation is made worse because independent providers are not covered for the NICs increase. The Nuffield Trust estimates that the increase in national insurance will cost independent social care employers £940 million this year. Many are handing back contracts, unable to make the numbers add up, which is piling pressures on to councils. I urge the Minister to look closely at the impact of this change. The Liberal Democrats want a social care workforce plan, a royal college of care workers to improve recognition, and a higher carer’s minimum wage. We call on the Government to complete the Casey review within one year instead of three. The elderly, disabled and our NHS deserve better than further delay.

The crisis extends beyond adult care, affecting our youngest children too. SEND provision is, as we know, inconsistent and underfunded. Parents are exhausted, teachers are overwhelmed, and children are being left behind. We are relieved, rather than happy, that the statutory override will continue for another two years, because many councils would face insolvency within months without it, but this merely defers the inevitable. As debts outgrow reserves, councils cannot invest in their communities or drive local growth.

The upcoming White Paper must guarantee every child with an EHCP the support that works for them, make mainstream education more inclusive so that children can stay close to home with their peers, and urgently reform the funding formula. The funding formula does not work. In some areas, the annual base funding per pupil is £2,500 less than in others. Schools have to fund the first £6,000 for any special educational support, but some schools do not get £6,000 a year for a pupil’s whole education. The Liberal Democrats really are begging for that to be resolved. In specialist provision, I have seen independent settings charge more than £100,000 to educate children with moderate needs when a state-maintained special school is doing the same for £20,000; but, without alternatives, councils are forced to pay.

The loss of the £100 million rural services delivery grant was a huge blow to rural councils, so I welcome the consultation on reviewing that, but those councils face not just higher delivery costs but recruitment challenges. It was wrong for the Government to suggest that rural communities do not face the same deprivation—tell that to some of my constituents who have no mains gas and no sewerage, no job opportunities and are miles from anything.

The Liberal Democrats welcome the £267 million for rough sleeping and £194 million for homelessness prevention, and we are pleased that that has been ringfenced, but without a target for social house building, councils remain burdened with the costs of temporary accommodation. It is not just about money: the Housing, Communities and Local Government Committee’s recent report revealed that temporary housing is detrimental to our children’s health, with it being a factor in the deaths of 74 children, including 58 infants, in the last five years. It also damages the developmental, mental health and life chances of every child in that situation. We therefore welcome the £39 billion investment in affordable housing, but we are disappointed to see how backloaded it is, meaning that many families will wait up to 10 years finally to get a roof over their heads.

Finally, I want to address devolution. The Liberal Democrats support genuine devolution, so we are disappointed that the Government have cancelled funding for neighbourhood plans and are discouraging the formation of new town and parish councils where there is local government reorganisation. Instead, we are seeing top-down area committees with no statutory powers. The spending review mentions funding for mayoral areas, but that benefits only those areas that are ready to go. What about the areas outside wave one such as Kent and Medway, or Wessex? Where is their support in the meantime? Our local councils deliver every day, but they cannot do it alone, so I urge the Government please to provide fair funding and real devolution for those areas.

[Madam Deputy Speaker (Ms Nusrat Ghani)]

I call the shadow Minister.