Local Government Spending (Floods)

Chris Williamson Excerpts

Tuesday 20th November 2012 Westminster Hall

[Chris Williamson (Derby North) (Lab)]

It is a pleasure to speak under your chairmanship again, Mr Gray. I congratulate the hon. Member for Thirsk and Malton (Miss McIntosh) on a very passionate and well-argued speech, which set out admirably the difficulties that her constituents have faced as a consequence of the flooding earlier this year. She is right to refer to the impact of climate change, because we are seeing more and more freak weather patterns, which are affecting constituencies all over the country. It is just the luck of the draw whether her constituents or my constituents happen to be the ones facing this extreme and localised flooding. That needs to be set in the context of a Government decision to reduce significantly—by some 27%—the funding for flood defence work. This is work that had been envisaged up until 2010, but will now no longer go ahead. Indeed, 294 flood defence schemes around the country are still awaiting a start date. It is money well spent if the Government invest in flood defence work. According to the figures I have seen, for every pound the Government invest in flood defence work, they save £1. That seems to be extremely good value for money, so it is a mistake for the Government to cut flood defence work.

My hon. Friend the Member for Newcastle upon Tyne North (Catherine McKinnell) spoke passionately about the devastating floods to which her constituents were subject. She is right to highlight the consequences for her local authority of the unprecedented funding reductions by the Department for Communities and Local Government. Of all sectors, local government has seen by far and away the biggest share of funding reductions, even though it plays a vital role in people’s everyday lives; dealing with the consequences of devastating floods is just one case in point.

My hon. Friend spoke eloquently about the difficult situation in which her local authority is being placed. Not only is Newcastle subject to significant funding cuts but the level of cuts that it has to absorb is far greater than that in other parts of the country. How can that be fair? Of course, it is not the only local authority affected in that way. Newcastle faces, in a sense, double jeopardy; the unprecedented funding cuts are far greater than those in many other parts of the country and it is faced with such huge expenditure. How is it supposed to cope? Many other local authorities could face the same dilemma that Newcastle faces as a result of the floods and unfair funding reductions.

My hon. Friend the Member for West Lancashire (Rosie Cooper) made some excellent points, which I hope the Minister will respond to, as did my hon. Friend the Member for Newcastle upon Tyne North and the hon. Member for Thirsk and Malton. My hon. Friend the Member for West Lancashire said that some of her constituents understandably felt abandoned in the situation that they found themselves in. How can that possibly be acceptable in the 21st century in one of the richest nations on the planet? Constituents faced with such extreme circumstances feel abandoned, and that cannot be right, and cannot be justified. Their plight has been exacerbated by funding cuts.

My hon. Friend also mentioned the heroic work of the fire and rescue services, and I pay tribute to them and the water rescue and flood relief work that they do. I hope to hear from the Minister today how he intends to enable the fire and rescue service to respond to water rescue work this winter and beyond, in view of the likelihood of more severe weather and flooding in different parts of the country. It is not only local councils that are subject to swingeing and unprecedented funding reductions and uneven funding cuts; the fire and rescue service is similarly affected.

Metropolitan chief fire officers have pointed out that, unless the Government make more funds available or do not proceed with the further cuts, which are planned in years three and four of the budget cycle, a number of those metropolitan fire and rescue authorities will be unable to fulfil their statutory obligations. It is interesting to note that the role of the fire and rescue service in dealing with flood relief and water rescue work is not a statutory one. As a result of the funding cuts imposed on the fire and rescue service, some fire and rescue authorities might not be able to respond to severe flooding events this year and in future years. I hope that the Minister can reassure us and tell us how he intends to resource fire and rescue services appropriately to enable them to respond in the event of further extreme weather patterns later this year, this winter and in the years to come.

In a sense, local authorities and local people have had insult added to injury. As hon. Members have mentioned, the former Local Government Minister is on record as saying that local authorities would receive a 100% reimbursement for dealing with the impact of the floods:

“I know that many households and businesses have been disrupted by the floods that have affected parts of the country. That is why we have announced that we will reimburse councils 100 per cent of their costs under the Bellwin scheme”.

The activation of the scheme was reaffirmed in a written ministerial statement by the then Environment Secretary, the right hon. Member for Meriden (Mrs Spelman):

“The Secretary of State for Communities and Local Government is activating the Bellwin scheme of emergency financial assistance to help local authorities with their immediate costs associated with protecting life and property in their areas. Exceptionally, the scheme will reimburse local authorities for 100% of their eligible costs above threshold.”—[Official Report, 9 July 2012; Vol. 548, c. 5WS.]

And yet, as the hon. Member for Thirsk and Malton mentioned, North Yorkshire county council somehow seems to have been bypassed by the Bellwin scheme. As I understand it, it has not received any money through the scheme as yet.

I do not understand what is happening. How can that possibly be? We had a ministerial statement. The Minister went on record to say that local authorities would receive 100% reimbursement, and North Yorkshire, which has had devastating floods, has not received anything. Gary Fielding, the authority’s corporate director for strategic resources, said:

“We wrote to the Department for Communities and Local Government…asking that they activate the Bellwin scheme. Unfortunately, the scheme is restrictive and does not help to meet the costs of capital…which includes infrastructure work…roads…, so the bridge which was swept away at Scawton and which will cost us £600,000 is not eligible. The CLG has declined any flexibility and has not activated Bellwin in any case.”

Local authorities are in an impossible position: the most extreme funding cuts are being inflicted on them and severe weather patterns result in extreme localised flooding. Local authorities and local people are left with an enormous clean-up bill, and local government is too enfeebled to respond to the needs of constituents. I do not envy any local councillor, or indeed MP, in that situation, when their constituents come to them for support and assistance, but no funding is available and the funding that was supposed to be available, and has been promised, has not been forthcoming.

I sincerely hope that, when the Minister responds, he will reassure hon. Members who have spoken today, those outside the Chamber this morning and, more importantly, the members of the public who have been subjected to floods. As we head towards the winter months—due to climate change, we see extreme weather and flooding in the summer months as well—people will be concerned about what assistance will be available should they be unfortunate enough to experience extreme flooding in their neighbourhoods. I hope that he will give reassurance that this shambolic state of affairs will be rectified, that the promised funding will be forthcoming and that the DCLG will look to assist local government flexibly, particularly because, as hon. Members have mentioned, it faces unprecedented cuts, so cannot respond as it would wish. Local government relies on central Government, and on the Minister, to give that reassurance and ensure that the funding will be forthcoming, so that we can protect the general public appropriately.

--- Later in debate ---

[Brandon Lewis]

I thank my hon. Friend for her intervention. I was about to turn to the difference between Bellwin schemes and capital expenditure. As I said, a Bellwin scheme covers only the costs of immediate action to safeguard life and property. Payments made under the last Administration—for example, in 2008—with which I think her local authority is making comparisons, were not Bellwin grants; they were to cover cost recovery from an exceptional event. I will turn to that in a moment.

A Bellwin scheme typically covers the costs of evacuating people from dangerous structures, and works to make them safe following a disaster; temporary re-housing; and initial repairs to, and the clearing of debris from, highways, pavements and footpaths. Let me make it clear—this may provide clarification for my hon. Friend—that it does not usually cover capital expenditure; the normal wages and salaries of an authority’s regular employees, whether diverted from their usual work or otherwise; and the standing costs of an authority’s plant and equipment.

Although a Bellwin scheme is discretionary, it has a statutory basis. As a Department, we must therefore ensure that the terms of each scheme and the eligible costs comply with the legislation. In particular, the statute sets out that expenditure must have been incurred on, or in connection with, immediate action to safeguard life and property or to prevent suffering or severe inconvenience. The idea of a Bellwin scheme is to put local authorities in a position to take speedy emergency action, to protect people during and immediately after an incident and to deal with the immediate catastrophic consequences.

Clearly, the statutory basis of the schemes means that longer-term works of repair or restoration will be ruled out, because they fall into the recovery stage rather than into that of immediate action. Although Ministers have previously used their discretion to enhance some of the Bellwin scheme terms—indeed, we have done so in relation to these incidents by extending the percentage of grant payable above the threshold, as others have said—we must continue to have regard to the legislation. Permanent repairs to roads and bridges would not therefore be eligible, but initial repairs and patching up works are fine.

[Chris Williamson]

Will the Minister comment on the fact that, as he has conceded, the last Administration funded local authorities over and above the Bellwin formula? Given the parlous state of local government finance as a result of reductions in funding, does he not agree that it is even more imperative for his Administration to look sympathetically on local authorities facing such exceptional costs? They simply do not have the resources to meet such expenditure under their funding regime.

[Brandon Lewis]

I agree with the hon. Gentleman in the sense that it is a shame that we inherited the parlous economic state in this country, and have therefore had to make decisions about how to sort out the debt and deficit problems left by the last Labour Government. I will turn to the capital situation in a moment. We have sometimes faced calls for Bellwin schemes to be amended or refreshed, but we remain committed to the terms outlined in statute. The scheme has the necessary flexibility, and it continues to be well-known and well used by local authorities.

Let me turn now to North Yorkshire. I am aware that the colleagues of my hon. Friend the Member for Thirsk and Malton from North Yorkshire county council registered a possible intention to apply for Bellwin support in September. My officials have requested further information to support a possible activation of the scheme and we await the council’s response. I understand that the council now considers that it will not be eligible for the scheme because the costs will not be above the Bellwin threshold. However, as allowed under the Bellwin rules, we will record costs for any future claims if further flooding occurs later in the financial year.

I know that hon. Members are keen to understand why the Department has not considered launching a recovery grant scheme, which has occasionally happened in previous years, most notably following the significant and widespread flooding events of 2007. Let me be clear—I appreciate that this is not an easy message to relay to constituents—while the flooding incidents of this summer were locally significant, we did not witness the devastating effects of previous years. Despite the individual stories of loss that we have heard, and our sympathy for those affected, the flooding this year has been on a much smaller scale overall.

Let me put the matter in context. In 2007, 55,000 properties, both houses and businesses, were flooded compared with only 4,000 this summer. The events on those two occasions are not comparable and the response, therefore, must be proportionate. Although we have activated a Bellwin scheme, we have not considered the need for a wider recovery grant. None the less, I will, in a moment, touch on the capital expenditure for roads and highways.

Successive Governments have used the Bellwin scheme as a benchmark, and we are doing the same. If we were to experience flooding on a larger scale, we would doubtless consider further Government support. For now, the balance has been appropriately struck between our Bellwin scheme, boosted to 100% of costs above the threshold to reflect the particular circumstances of the June and July flooding, and local support.

Thanks to the Government’s continued investment in flood defences, some 19,000 properties have been protected from flooding. In places such as Carlisle, the local authority has told us that the defences have saved some 2,000 homes from the summer flooding events. Despite the financial situation that we inherited, the Government have continued to invest substantially in flood defence, spending £470 million a year. I am sure that my hon. Friend appreciates that that has undoubtedly protected people’s homes and kept businesses operating when, in the past, they would have been under water.

[Chris Williamson]

I am surprised that the Minister is eulogising the Government’s continued investment in flood defence work when there has been a significant reduction in such work, as I pointed out in my opening remarks. Will he concede that there has been a 27% reduction in flood defence work?

[Brandon Lewis]

I was not eulogising the Government, but making the point that we are spending £470 million a year which, considering the economic mess that we inherited from the previous Labour Administration, is something that we should all know about.

Let me turn now to the role of local authorities. As ever, local authorities have been on the front line of the response to the flooding this summer. Of course, once flooding has subsided, recovery begins. Local authorities support such work from their reserves, which are there to help to meet the costs of emergencies, such as flooding. Of course, Bellwin is also in place.

I am sure that local authorities will look sympathetically at requests for hardship relief from business rates for businesses affected by the flooding. They were urged to do that quickly in the immediate aftermath of the event. If they grant such relief, Government will fund 75% of the cost.