Levelling-up and Regeneration Bill

Baroness Hayman of Ullock Excerpts

Report stage
Thursday 13th July 2023 Lords Chamber

Moved by

[Baroness Hayman of Ullock]

63: After Clause 78, insert the following new Clause—
“Fair funding reviewThe Secretary of State must publish the fair funding review within one year of the day on which this Act is passed.”Member's explanatory statement
The Secretary of State must publish the fair funding review setting out baseline funding allocations for local authorities within one year of the day on which this Act is passed.

[Baroness Hayman of Ullock (Lab)]

My Lords, we have one amendment in this group, on the fair funding review. The review document was first published some time ago, back in December 2017. We are concerned that virtually nothing has happened in those five, nearly six, years to bring about its implementation.

We know that local government needs its core funding to have long-term security in order to make proper budgetary decisions and to ensure that it can meet all its obligations. So, the fact that reforms to local government funding have been delayed time and again is of great concern. We are particularly concerned now—we were initially told that they were being delayed until April 2023, but they now seem to be delayed beyond the next general election. For some authorities, the delay will simply postpone an inevitable reduction in funding, which is concerning in itself, but for others it could mean waiting up to at least two more years for funding to come close to catching up with their needs.

I stress that what we are talking about here is the critical core funding; it is not related to the other different pots the Government have for councils to bid and apply for. It is the central, critical core funding that councils receive.

What is the Government’s expectation about when these funding reforms will be implemented? Is it going to be in 2026-27? Is it likely, by any chance, to come in earlier, or could it even be later? It is important that local government has some sort of clear idea about when to expect it. Is the Minister able to give any oversight on the factors likely to govern and influence the timing of implementation? What kind of package of funding reforms is currently under consideration within the fair funding review?

Given that it has been quite a long time—more than five years, coming up to six—do the Minister and his department believe that the proposals which came out then are still fit for purpose? Are they flexible enough to deal with the shifts in available data and the different council service models that have come forward as a result of Covid-19? There have been quite a number of changes and responses to the pandemic.

We tabled this amendment because we feel that the Government need to act urgently in this area and to basically just get on with it. Our amendment would ensure that within a year of the passing of this Act, the Secretary of State must publish the fair funding review, which would include setting out the baseline funding allocations for local authorities. We believe this is necessary to bring to an end so much uncertainty for local authority budgeting and to allow our councils to plan and deliver the services our communities need. I look forward to the Minister’s assurances.

[Lord Shipley (LD)]

My Lords, my Amendment 66 would repeal Section 13 of the Elections Act 2022. Its aim is to reinstate the supplementary vote system for police and crime commissioners in England and Wales, the Mayor of London, combined authority mayors and local authority mayors in England. I said earlier today that there was an excess of centralisation in this Bill and other structures that have been created around combined authorities.

--- Later in debate ---

In addition, in practical terms, Section 13 of the Elections Act works together with a suite of statutory instruments which were also approved by your Lordships in 2022. Those statutory instruments made consequential changes to the rules for how mayoral and PCC elections are conducted, and to the ballot paper and other forms to ensure consistency with the first past the post voting system. Repealing Section 13 would therefore leave an incomplete and inconsistent legislative framework, which could lead to confusion for those tasked with administering elections.

[Baroness Hayman of Ullock (Lab)]

I thank the Minister for his response. However, I would like to make a couple of points. I do not think he has addressed the fact that we still have this huge issue of funding not being fairly allocated. That is the whole consideration. I completely appreciate that the figures are different now and that things have moved on; the Covid pandemic changed the situation for councils. But how long will it be before further consultations and discussions take place? How long will it be before we have another proposal, and will that be looking at fair reallocation? This is something that has been promised to councils for an awfully long time, and it is frustrating that it is potentially going to drag on for years longer, because we still have that disparity of core funding.

The extra funding mentioned by the Minister such as the levelling-up funds is not part of what we are talking about in this instance. It does not deal with the fundamental problem of the long-term fairness of allocation of funds right across the board. The Government may say that they are giving a particular council some extra money or there is this bit coming in, but that does not deal with the ability of councils to know in the long term what kind of funding to expect and be able to budget and plan services accordingly.

Finally, the lack of fair funding, which means that many poorer areas have less money, is only exacerbated by council tax returns—richer areas tend to receive more because their properties are of a higher value—and this is particularly true for business rates, as poorer communities do not tend to have businesses that pay the higher rates of tax to local authorities. So, while I will withdraw my amendment, I really think that this needs to be considered in more detail.

Amendment 63 withdrawn.