Local Government Funding: Rural Areas

Cheryl Gillan Excerpts

Monday 11th January 2016 Commons Chamber

[Graham Stuart]

I do. As the system comes in, there will be equalisation, and because of the different dynamics at work and despite the righteous principle—on this side of the House—in believing people should be incentivised to do the right thing and then keep the money, there will almost inevitably be a revisiting. If it turns out that someone’s huge shopping centre is going to be closed, the idea of them being left with no money is preposterous; similarly, if a huge bounty comes someone’s way, it is pretty likely that the Government will do what Governments have always done and raid it.

[Mrs Cheryl Gillan (Chesham and Amersham) (Con)]

From the perspective of Buckinghamshire, it is no exaggeration to say that this year’s local government settlement is far worse than the worst case and the worst scenario that the county council had calculated. On my hon. Friend’s specific point, beyond 2018-19, when Buckinghamshire loses the revenue support grant, the council has learned that it will effectively lose a significant portion of the business rate top-up grant. In 2018-19, it is set at £1.6 million and in 2019-20, it is £10.95 million. Is this not, in effect, a tax on success?

[Graham Stuart]

My right hon. Friend makes a strong point.

Returning to my theme of why we should be at least cautiously optimistic about any review promise in future, the Government responded to our campaign in 2014 and promised to conduct research into the additional costs of delivering services in rural areas. They say that they cannot move to recognise it until the evidence is there, and we have long said, “Show me a single service that is cheaper to deliver per head in a sparse rural area than in a concentrated urban one, and we will be delighted to hear it.” I have not heard anything yet. Apparently the current inequities are defensible without any evidence, but any change, even on the most common-sense basis, requires vast amounts of it.

Anyway, the Government conducted the promised research.in 2014. They gathered data from councils at short notice, during the month of August. Strangely, there was a shortage of data, and—unsurprisingly—no real conclusions were reached and no appreciable change was delivered. We were told, “We are sorry, but there is nothing to justify any change.” I therefore caution colleagues not to expect jam tomorrow.