Local Government Finance

Debate between Hilary Benn and George Howarth

Wednesday 8th February 2012 Commons Chamber

[Hilary Benn]

My hon. Friend is absolutely right, and he anticipates some of the figures I am going to give to the House.

First, however, it is important to note that the Secretary of State lost out to the Treasury—assuming, of course, that he tried to protect local councils in the first place, and there many who would doubt whether he put up much of a fight, given the glee with which he regularly attacks councils for what they do. The consequences of all this are: one, that local government has to deal with cuts that are unfairly distributed; two, that residents are having to come face to face with the consequences of those cuts, as services they rely on change or go; and, three, looking to next year, that councils face nothing but uncertainty about their future financial position. Let me deal with each of those in turn.

Despite the Secretary of State’s claim that what he has done is fair and sustainable, the House knows that the 10% most deprived upper-tier authorities are facing a reduction in their spending power that is nearly four times greater than that faced by the 10% least deprived authorities. That is why the Minister’s argument falls at the very first hurdle. It is also undermined by his Department’s figures.

Newcastle city council has done us all a very great service by laying out the facts. It looked at data taken from the Department for Communities and Local Government showing the cuts in 2010-11, 2011-12 and 2012-13, taking account of transition and council tax freeze grants and the provisional new homes bonus allocations. What do the figures show when all that is taken into account? Basingstoke and Deane will gain—I stress, gain—£6 a person overall, while Knowsley will lose £227 per person. East Dorset gains £3 a resident, while Manchester loses £186. In Greater London, everyone loses, but some lose much more than others. The borough of Richmond is down by £2 a head, whereas Hackney is hit by a whacking great loss of £234 a head. Why is that? Those are the raw figures behind the hard-faced politics that prove that the Chancellor is trying to balance the budget on the backs of the poor.

If Ministers do not like hearing the truth from Newcastle or from their own statistics, what about hearing it from the independent Institute for Fiscal Studies? Its analysis by region shows that London and the north of England have been especially badly hit. Every year it publishes the green budget before the real Budget, and the 2012 green budget shows that overall cuts in local government spending, excluding education, are largest in both absolute and proportional terms in London, the north-east and the north-west.

[Mr George Howarth (Knowsley) (Lab)]

My right hon. Friend mentioned Knowsley a moment ago when he was comparing figures. Does he agree that when we look at the acute levels of deprivation across the spectrum that we experience in Knowsley, those figures are even worse, because some of the poorest communities in the country are being punished severely in comparison with some of the better-off communities which are getting off almost scot-free?

[Hilary Benn]

My right hon. Friend argues the case for his constituents with great force and vigour, and he is absolutely right. This is fundamentally unfair. The reason it is happening—the Minister was remarkably reluctant to admit the truth—is that councils in deprived urban areas rely to a much greater extent than councils in more affluent areas on central grants from the Treasury, which have been cut significantly.

Business of the House (Thursday)

Debate between Hilary Benn and George Howarth

Wednesday 8th December 2010 Commons Chamber

[Hilary Benn]

As I said, the quote from Lord Browne is:

“Over the last year, we have consulted widely and intensively.”

[Interruption.] If hon. Members will be patient, they will see what this has got to do with the business motion before us tonight. Let us compare the length of time that Lord Browne took in preparing his proposals to what is before the House tonight. The Browne committee had a year to consider what it recommended; the House is to be given five hours to consider the recommendations and dispose of them. Everybody else was consulted at length, but MPs are to be given just five hours to express a view.

[Mr George Howarth (Knowsley) (Lab)]

I wonder whether my right hon. Friend can help me. I have been pondering whether any measure of comparable controversy has ever gone through this House with so little debate and in such a short space of time. Can he help me? Is there any example of that?

[Hilary Benn]

In preparing for the debate this evening, I, too, asked myself that, and I struggled to think of another example of when the House had so little time to consider something so profound.

Nobody can be under any misapprehension about the scale of the change that is being proposed. Lord Browne said:

“What we recommend is a radical departure from the existing way in which HEIs”—

higher education institutions—

“are financed…Our recommendations will lead to a significant change”.

The plain truth is that the Browne report, which is radical and significant in its implications, has not even been debated in the House yet. Since the report was published, on 12 October 2010, there has been one urgent question, when the Secretary of State was forced to come to the House and explain what was going on, and one ministerial statement, on 3 November. However, there has been no debate at all on the Browne report in Government time—none.