Local Government Funding

Baroness Hayman of Ullock Excerpts

Wednesday 3rd February 2016 Westminster Hall

[Sue Hayman (Workington) (Lab)]

It is a pleasure to serve under your chairmanship, Mr Davies.

I will raise just a few of the significant concerns that Cumbria County Council has spoken to me about regarding the provisional local government finance settlement. I am sure that everyone is aware that Cumbria suffered very badly in the flooding before Christmas, but what people perhaps do not realise is that it is ongoing. Another bridge collapsed last week. Our problems are not over. The amount of money with which the Government propose to support us is so woefully inadequate that it will add to the difficulties we have with the settlement.

I will speak about rurality and the fact that we have a super-ageing population. Rural residents on the whole—certainly in west Cumbria—earn less than their urban counterparts, yet they pay more in council tax, get less in Government grants and receive poorer and fewer services, which often cost residents to access them because they might have to move. It is not a fair system.

[Imran Hussain]

Although I have some sympathy with the argument regarding the rural and urban comparison, surely this is not a matter of rural versus urban. This is a matter of some of the most deprived authorities, whether they are rural or urban, being hit the hardest. My district of Bradford will face up to £260 million of cuts by 2018. Does my hon. Friend agree that the most deprived authorities, regardless of whether they are rural or urban, are the worst hit, and that that will increase inequality and deprivation and decrease opportunities?

[Sue Hayman]

The fundamental point of argument, which I will come to, is about the way that funding is decided on need. That relates to what my hon. Friend says.

Cumbria has one of the fastest-growing populations of older people in the whole country, which will put extra pressure on the council in the future. This is about not just the funding formula now but the proposals for future years, and that is not taken into account.

The timing of the announcement and the consultation process is important, but it often gets glossed over. The announcement of the provisional settlement came very late in the year, more than three weeks after the autumn statement and the announcement of the spending review. Inevitably, that resulted in a short consultation period, which happened over Christmas. I understand that that was done to keep to the timetable for the announcement, but it is not helpful when councils are trying to manage their budgets and prepare for the future. There were significant changes, which should have meant a proper consultation, as Government guidance states that “12 weeks or more” is appropriate when significant changes are being made. The consultation fell well short of that. I urge the Minister to look at how we can improve consultations and their timings.

On the proposed approach to allocating the funding, I appreciate what my hon. Friend the Member for Leicester West (Liz Kendall) said, but the methodology does result in rural areas losing a significant amount of funding.

[Steve Double]

As the hon. Lady may know, I represent a constituency in Cornwall that faces many of the same challenges as her constituency. Does she agree that part of the problem—this is not a party political point, because this has been true under successive Governments —is that deprivation is not measured in the same way in rural areas as it is in urban areas? It is often hidden, but it is just as much of a real issue.

[Sue Hayman]

The hon. Gentleman makes an extremely pertinent point. People who live in rural areas often have very low expectations of the level of service they should receive, so they often put up with receiving an awful lot less. That is not sufficiently taken into account.

I will briefly touch on the topic of social care, about which my hon. Friend the Member for Leicester West made some powerful points. My understanding was that the Government’s stated desire—the Minister may put me right on this—is for greater protection for councils that provide adult social care. Therefore, it does not make sense to me that that money is diverted away from the county areas, such as Cumbria, that have a larger proportion of ageing people and a faster-growing elderly population. It has a profoundly negative impact on the stability of an already very fragile care market, and will have a knock-on effect for the wider health sector.

The distribution of funds for councils should take into account not only resources but needs. The proposals do not reflect that, and it is important to address that for the future. If we do not reflect need, where are we going, particularly with regard to social care? Cumbria County Council struggles to deliver social care and mental health services. To come back to my first point, social care and mental health care will be under increased pressure because of the impact of the floods. I urge the Minister to consider how he can support us in those areas.