Local Government Finance

Baroness Primarolo Excerpts

Wednesday 12th February 2014 Commons Chamber

[Relevant documents: Oral evidence to the Communities and Local Government Committee on 27 January, HC 1024.]

[Madam Deputy Speaker (Dawn Primarolo)]

I can report to the House that the Select Committee on Statutory Instruments has cleared the two reports that are to be debated.

[The Parliamentary Under-Secretary of State for Communities and Local Government (Brandon Lewis)]

I beg to move,

That the Referendums Relating to Council Tax Increases (Principles) (England) Report 2014-15 (HC 1056), which was laid before this House on 5 February, be approved.

[Madam Deputy Speaker]

With this we shall consider the following motion:

That the Local Government Finance Report (England) 2014-15 (HC 1055), which was laid before this House on 5 February, be approved.

[Brandon Lewis]

Members on both sides of the House may well be aware that until now the Secretary of State has not missed a local government finance settlement debate in this Parliament. He sends his apologies, and hopes to join in the debate later in the evening, but, as I am sure Members will understand, he is currently attending a Cobra meeting.

The coalition Government have been working determinedly to restore the public finances, which were left in such disarray by the last Labour Government. It has been complicated and difficult work, and difficult decisions have had to be made. It is in the context of our responsible, long-term economic plan that we have been consulting on the local government finance settlement for 2014-15. Our proposals are fair and balanced, and provide an effective basis for all local authorities to transform local services and promote efficiency. Following a wide range of representations and meetings, we confirmed last week that the settlement would remain almost entirely as announced in December. This is effectively the second year of a two-year settlement, which gives councils a new level of self-determination so that they can take control of their own finances.

--- Later in debate ---

[John Hemming (Birmingham, Yardley) (LD)]

I thank the Minister for meeting MPs from Birmingham to look at this issue, and I congratulate hon. Members generally on highlighting the difficulty of working out what a fair system is for allocating local government finance. The Government have focused on percentage reductions in spending power. Does the Minister agree that, after incentives, looking towards the reduction in percentage spending power, not absolute spending power, provides an equality of pain that gives us a way forward? It takes into account the fact that in areas like Greater Birmingham, where people work in Birmingham but live around it and require services from Birmingham but are not contributing towards—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. Before the Minister replies, may I remind the House that 17 Members wish to participate in this debate? Interventions must be short, and I will start to interrupt them if they continue to be as long as they have been so far.

[Brandon Lewis]

Thank you, Madam Deputy Speaker. The hon. Gentleman made that point in the meeting we had. As I said to him, I will happily go through it in more detail over the next couple of months, meeting him and officials to look at some of the ideas he is talking about.

--- Later in debate ---

[Richard Burden (Birmingham, Northfield) (Lab)]

On this issue of spending power, may I take the Minister back to the first and second answers that he gave and see how he puts them together? My hon. Friend the Member for Birmingham, Erdington (Jack Dromey) talked about the reduction in spending power in a deprived area such as Birmingham. The Minister said, yes, but it has a higher spending power in the first place. My hon. Friend the Member for Easington (Grahame M. Morris) then said that the reason—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. This is not an opportunity to make a speech. I want the hon. Gentleman to put a short question to the Minister.

[Richard Burden]

The Minister said that the reason was that such areas have higher needs. If that is the case, let us go back to the same question: why do the most deprived areas with the highest needs get the biggest reductions?

--- Later in debate ---

[Several hon. Members]

rose—

[Madam Deputy Speaker (Dawn Primarolo)]

Order. It will be necessary to have a six-minute time limit on all Back-Bench contributions, although it might be necessary to revisit that later.