Local Authorities: Financial Difficulties

Baroness Stuart of Edgbaston Excerpts

Wednesday 14th February 2024 Lords Chamber

[Baroness Scott of Bybrook (Con)]

I agree with much of what my noble friend said. In December 2022, the Government ruled out reform of the local government finance system in this Parliament in response to the sector calling for stability and certainty from local government. However, this Government are committed to reforming the local government funding landscape in the next Parliament.

[Baroness Stuart of Edgbaston (CB)]

My Lords, I stress the need to review the local government financial settlements and support systems. In the case of a city such as Birmingham, even if increasing the council tax were realistic, a quarter of households—some 461,000 —are eligible for council tax support, and of those, 75,000 pay no council tax at all. Over the next two years, the city is facing a budget gap of some £300 million. Does the Minister agree that the structure needs to be reviewed and that individual circumstances have to be taken into account?

[Baroness Scott of Bybrook (Con)]

I repeat that we have said that we will look at funding in the next Parliament. There is an 18% increase in budgets per dwelling in the most deprived areas, compared to the least deprived. Through the settlement, places such as Birmingham are getting a lot more money.