Local Government Funding: North-East

Debate between Lord Beamish and Ronnie Campbell

Tuesday 1st March 2016 Westminster Hall

[Mr Kevan Jones (North Durham) (Lab)]

It is a pleasure to serve under your chairmanship, Sir David. I congratulate my hon. Friend the Member for Darlington (Jenny Chapman) on obtaining the debate.

There was a time when the Conservative party believed in local government, and it had a long tradition of supporting it. My hon. Friend the Member for Washington and Sunderland West (Mrs Hodgson) highlighted the effect that the Thatcher Administration had on our region, but one thing that Margaret Thatcher did not do was devastate local government as the present Government are doing. Many people in my constituency say “They are as bad as Thatcher”. No, they are worse than Thatcher. They do not believe in the state as we do. They take the view that local government should just deliver statutory services. As my hon. Friend the Member for Darlington eloquently outlined, that is what the people of Darlington will end up with—an authority with the ability to deliver just statutory services. Everything else that we have for generations taken for granted that councils should deliver will go by the bye.

What makes it worse is that the Government are in the most blatant way allocating funding to pacify voices within their own party. I am not sure that it will pacify them for long, because I do not know how they will protect the areas in question in the long term, given the reductions that the Government still have in line—a cut of some 56% for the Department for Communities and Local Government. However, at the moment that is clearly what they are doing.

Where, in the core spending and transitional arrangements, are the lowest reductions being made? What are those very deprived areas? They are Surrey, Hampshire, North Yorkshire and Devon. We have a ludicrous situation of North Yorkshire getting a 2.5% increase and Surrey a 1.5% increase in core spending. A 2.5% increase in our core spending in Durham would mean an additional £10 million of funding. On the figures for core spending powers and cuts in 2016-17, Durham will have minus 4.1%, Newcastle minus 4.4% and Sunderland minus 4.3%. Surrey will have a 1% reduction and my favourite place, Wokingham, a 0.4% reduction.

I think it has been the understanding of all Governments, irrespective of political make-up, since the second world war, that need has to be taken into account. The idea that it is possible to equate the health problems and social deprivation of the north-east and, I must say, inner-city areas in parts of some London boroughs and the north-west with pressures in Surrey and Wokingham, is nonsense. In the figures for the final settlement for 2016-17, the core spending per dwelling figure for Durham county council is £1,608; for Surrey it is £1,661. It may be thought that that is not much higher, but no account is taken of the demands of an ageing population in Durham, and its higher unemployment and social care needs. If the district councils in Surrey are taken into account, the core spending per dwelling figure goes up to more than £2,000. I am sorry, but it cannot be right that one of the wealthiest parts of the country is getting more expenditure than some of the most deprived communities.

The rural indicator was a measure that the Government brought in to try to compensate for rurality. There could not be a more rural county than County Durham; but what did it get out of it? Not one penny. I do not object to Northumberland, which includes the constituency of my hon. Friend the Member for Blyth Valley (Mr Campbell), getting some extra funding, but why did that county get it? It is because it has two Conservative Members of Parliament. We are now in a situation where funding is allocated on the basis of what the local electors decided. The Government are punishing electors in the north-east for voting Labour. We would expect that in a totalitarian dictatorship, not in a democracy such as ours.

[Mr Campbell]

Could we press the Communities and Local Government Committee to have an inquiry, covering the whole gamut of this issue?

[Mr Jones]

I would welcome that, but I remind my hon. Friend that this lot do not care. What they did in the previous Parliament shows that. They are small state Conservatives who frankly do not give a damn about the north-east, because it means nothing to them electorally.

One of the biggest needs of, and pressures on, most of our councils is social care. The Government have announced that councils can charge 2% extra on council tax. That will raise a lower amount in Durham than in Surrey, because about 55% of properties in County Durham are in band A. The idea that that is a panacea that will answer the social care issue is not true. My hon. Friend the Member for Newcastle upon Tyne North (Catherine McKinnell) demonstrated the problems that Newcastle City Council faces, and the situation will be duplicated in all north-east and inner-city councils, which have huge pressures on them.