Local Government Finance

Andrew Snowden Excerpts

Wednesday 11th February 2026 Commons Chamber

[Manuela Perteghella (Stratford-on-Avon) (LD)]

I am incredibly proud to have been a councillor until last year, because local government is the foundation of so much that matters in people’s daily lives. It keeps our streets clean, supports vulnerable families, funds social care, maintains roads, protects our environment, ensures that our children can get to school safely, keeps our bins emptied and keeps our potholes filled, but not everywhere. When councils are stretched to breaking point, it is residents who feel the strain.

I welcome the move to a multi-year settlement, which we have long argued for. Councils need certainty and to plan beyond a single financial year. That stability matters, but let us be clear: a longer settlement does not in itself fix a broken system. The Public Accounts Committee has warned that deficits could reach nearly £4 billion a year by 2027-28, and that is not sustainable.

On top of that, we now have rising demand, inflationary pressures, increases in the national living wage and the hike in national insurance contributions, and councils are expected to absorb all of this. Further, making any material changes—for example in the assumptions about the level of business rates pooling and effectively reducing councils’ funding allocation between the provisional and final settlement—will cause serious challenges for many councils, including Stratford-on-Avon district council, which could see a big cut of 5% or more of its total spending power. If I heard correctly, the Secretary of State pledged to refund those councils affected by this material change, and I would like those on the Treasury Bench to confirm that. Our constituents are the ones who are going to be impacted, and the provision of valuable local services will be affected.

I am deeply concerned about the impact on rural areas like mine. The shift to a need-and-demand model risks overlooking the real costs of delivering services across large, sparsely populated areas. Rural councils often receive less grant funding yet face higher transport costs, greater recruitment challenges and weaker public transport networks. That reality must be properly recognised in any fair funding formula.

In my constituency, I see the pressures on local government every day. Stratford-on-Avon district council, led by the Liberal Democrats, has shown what responsible local leadership looks like even in tough times. It has delivered the third highest recycling rate in England. It has rolled out natural flood management. It has installed solar panels on leisure centres to cut running costs and reduce emissions. It has allocated £600,000 to a cost of living mitigation fund to support our most vulnerable families. That is practical, sensible, community-focused governance. That is what can be achieved when councils are run competently and with a clear sense of purpose.

We can contrast that with the chaos we have seen at Warwickshire county council, now run by Reform. Last week, after a gruelling 10-hour meeting, the minority Reform administration failed to pass a budget. The Liberal Democrats put forward an alternative that would have invested £20 million in tackling child poverty, protecting youth services, improving home to school transport, and investing in infrastructure for the future. For an extra 39p a week, we could have protected services for thousands of young people and vulnerable residents. Instead, Reform doubled down on cuts that would hit families hard, including changes that could leave children walking up to five miles to school, often along unlit rural roads. Reform and the Conservatives combined to block that investment, and then still could not agree a budget of their own, leaving the council in limbo. This Tory-Reform stitch up is costing residents in Stratford-on-Avon and across Warwickshire. As we look ahead to local reorganisation in Warwickshire, these choices matter even more.

[Mr Andrew Snowden (Fylde) (Con)]

On the point about Reform councils and the promises they made and the reality of that, in Lancashire they are trying to balance the books by initially consulting on closing 10 care homes and day centres and narrowing that down now to just the day centres. Does the hon. Member share my surprise that Reform MPs are not here to defend their record on what they promised versus the reality of a Reform-led council?

[Manuela Perteghella]

Yes, the Reform Benches are empty, as we all can see and as the British public can see, and this is really important because, as I have said, local government is the foundation of our places. It gives us our civic pride in our areas and is on the frontline of delivering services, so this is really disappointing, and there is chaos in Warwickshire; we are still without a budget. Stratford-on-Avon district council has made a clear case for a south Warwickshire unitary authority that reflects the real communities and keeps decision making closer to residents. Reform is pushing for a single county-wide super-authority that would centralise power, moving it further away from local people. At a time when trust in politics is fragile, we should be strengthening local democracy, not weakening it. We must keep local government local.

Local authorities are ready to play their part in delivering growth, tackling the climate emergency, insulating homes, improving air quality and building the infrastructure that our communities need, but they cannot do so if they are permanently firefighting. If we are serious about having strong communities and a strong economy, we must get local government finances right and not defund rural councils. We need to support them, so that they can deliver for their residents, rather than leaving them to pick up the pieces of national Government failure.

--- Later in debate ---

[Mr Betts]

I will not go through every detail of this settlement. There is always a balance to be struck in local government settlements, and Ministers have to make their own judgments about that. It is the overall impact that I want to judge the settlement by. For me, this is a fairer settlement for those authorities with high levels of deprivation and some of the worst cuts in the years of austerity.

[Mr Snowden]

It is all very well to say that this is a fair settlement. On balance, councils that have Labour constituencies benefit from it, and councils that are represented by Conservative Members do not. The fairness can be derived from that.

[Mr Betts]

First, there are many more councils with Labour MPs. It might be the case that Labour MPs represent councils with higher levels of deprivation. That might be the simple explanation.

--- Later in debate ---

[Mr Brash]

I would say that if we want there to be trust in politics, we need to be accurate in what we say in this place, but I appreciate the hon. Gentleman’s correcting the record.

The Minister understands exactly what I am going to say. I know how sympathetic and supportive she is in this respect, and I hope that in the coming days we will be able to deal with the issue that I am going to raise. I thank her for her support in recent weeks.

I want to be clear about what Hartlepool is facing, and about why I cannot regard the current settlement to be fair and also believe it to be self-defeating. Hartlepool now has the third highest number of children in care in England. That pressure has been made worse by other local authorities placing families in my town, leaving us with a £6 million overspend in children’s social care alone. My brilliant Labour council has already taken decisive action, halving that projected deficit in-year and establishing a robust, credible plan to eliminate it entirely. That plan is exactly what the Government say they want to see: it means fewer children coming into care, more early intervention, stronger families and better outcomes. It includes strengthened early help and family support, a dedicated edge-of-care team, a refreshed in-house foster care model, safe reunification pathways, wholesale SEND reform, enhanced support for care leavers, and better workforce planning. This is a serious, preventive change, not a sticking plaster solution.

But here is the problem: these reforms require short-term stability to succeed. The settlement does not recognise the sheer number of children in care in my constituency. It undermines prevention, which means that we are likely to see more children in care, more long-term costs, and worse outcomes. That is why I see this settlement as self-defeating. Ministers will rightly point to percentage increases in funding, but those percentages mean far less in Hartlepool than they do almost anywhere else, because our baseline is already so low. The cost of a child in care is exactly the same in Hartlepool as it is anywhere else.

When we look at it in cash terms, the reality is stark. The increase in the Government grant for Hartlepool this year is just £3 million, which is equivalent to funding around six children in care. After weeks of discussions and representations, the final settlement for Hartlepool has remained unchanged, yet down the road—this sticks in the craw for me—Reform-led Durham county council has received an additional £3.7 million this year, which means that it is reducing the amount by which it is increasing council tax. The increase in Durham’s final settlement is more than our entire increase this year. I cannot describe that as fair funding.

As we have heard from many Members from across the House, the unfairness is compounded by a broken council tax system. Hartlepool has one of the weakest tax bases in the country, with a high proportion of homes in band A. A 1% increase in council tax in Hartlepool raises a fraction of what it raises in wealthier areas, yet our residents already pay far more, both in real terms and as a share of their income, than those living almost anywhere else in the country. The settlement simply does not change that reality.

Governments of all stripes talk about core spending power, but half of that core spending power is achieved by raising council tax. That hammers the poorest communities the most, and it is a regressive tax. That is not fairness; it is entrenched inequality. To make matters worse, changes to deprivation measures and population assumptions mean that Hartlepool’s needs are being systematically underestimated. Official forecasts put our population at under 94,000, yet the Office for National Statistics data shows that it is already closer to 100,000—growth that is driven in large part by other councils discharging their homelessness duties into my constituency. Hartlepool is not asking for special treatment; we are asking for support to deal with a problem that is not of our making.

[Mr Snowden]

The hon. Member is touching on an important issue that affects a lot of councils across the north of England, including Blackpool, which neighbours my constituency. Larger metropolitan areas are effectively exporting their children-in-care problems to much cheaper areas, such as Blackpool and Hartlepool, which the hon. Member represents. Some kind of restriction on how far councils can move children who are being put into care might stop the dumping of children in care in areas where housing is cheaper.

[Mr Brash]

I thank the hon. Member for his comments, and I endorse them wholeheartedly. I have heard stories of London boroughs and Birmingham city council putting families in taxis with the threat, “Get in the taxi, or you’re homeless.” They do not know where they will get out at the other end, and they discover that they are in Hartlepool only when they arrive. It is left for our council to deal with the pressure and the additional SEND needs, and for our council to deal with the children, who sometimes end up in care. It is a disgraceful practice that should rightly be cracked down on. I know that the Minister is alive to this problem, and it needs to be dealt with.

--- Later in debate ---

[Mr Brash]

I absolutely endorse all that; part of that work needs to be taking a very close look at the funding settlement. We need to look at whether councils that may have done very well out of the settlement are still moving people out of their areas, even when they have extra finances from this Government.

[Mr Snowden]

I thank the hon. Member for giving way, as he gives me a chance to respond to the Minister as well as to himself. As a former police and crime commissioner for Lancashire, I saw at first hand the impact on communities of cities miles away in effect dumping children into high crime, high deprivation areas simply because the housing is cheaper. Dealing with the damage that has on children’s life chances—let alone the impact on communities already struggling with regeneration by adding to the problems—is paramount. I would be more than happy to meet the Minister and the hon. Member to discuss how we take forward this issue not only on the Fylde coast, but across the north.

[Mr Brash]

I will take up the hon. Member on that invitation. He mentioned Blackpool, and I know that the Members who represent Blackpool and Stoke—in the top three areas for the number of children in care—would also be very interested in his offer.

Without support to deal with the gap in our in-year funding for children’s social care, the risks are clear: prevention will fail, costs will rise, and vital community services such as youth provision, libraries and community hubs will be under threat. I fully support my Labour council colleagues, who have been clear that they are not prepared to make those cuts, which would be so self-defeating in the round.

This is a moment of profound seriousness for my constituency. Hartlepool has a plan for children’s social care that is aligned with the Government’s agenda, but we now need a settlement that gives us a fair chance to deliver it. I have spoken today with our council leader and colleagues in Hartlepool, and they are distraught, despondent and profoundly worried about what the future holds—in just a matter of days, when the budget is due to be set in Hartlepool—so I appeal to the Minister for any piece of support she can give me.