Local Government Finance

Bob Stewart Excerpts

Wednesday 8th February 2012 Commons Chamber

[Bob Blackman]

I thank the hon. Gentleman for that contribution. One of the necessary aspects of outsourcing is making sure that local authorities work on a partnership basis, rather than just by the letter of the law as set out in the contract. Far too many local authorities are not smart enough in the way they write procurement contracts to make them fit for purpose. By ensuring that contracts are demonstrated and written in the right sort of way, flexibility can be built in and services maintained.

[Bob Stewart (Beckenham) (Con)]

Surely the best way of doing that is by writing the contract in the first place with break points at regular intervals so that changes can be made.

[Bob Blackman]

I thank my hon. Friend for reminding me that one of the necessary aspects of procurement is having suitable break points and review points in a contract, so that the contract is long enough for investment to take place but can be changed or terminated by the local authority if the service is not up to scratch.

I also take issue with the view of the right hon. Member for Leeds Central on balances and reserves. I feel very strongly that taking money from council tax payers and putting it into reserves or balances, rather than spending it on services, is theft from the taxpayer, because it is not being invested in the services provided. In my view, local authorities that maintain large reserves or balances are fundamentally fooling their taxpayers and should be exposed for doing so. Local authorities should maintain balances, but only balances that are required for cash-flow purposes or for funding in-year hikes that might take place.

--- Later in debate ---

[Bob Stewart]

Would it not be fairer, and would it not be seen to be fairer, if we talked in terms of percentage cuts rather than using actual figures? If we looked at the cuts in terms of percentages, we would see things better. I am myself trying to clarify the point.

[Mr Betts]

Sheffield city council is making cuts of 11% in its budget this year, and that is substantially more than many councils in more affluent parts of the country are making—much bigger in percentage terms, let alone in amounts per head.