Local Government Finance

Christian Matheson Excerpts

Tuesday 5th February 2019 Commons Chamber

[Christian Matheson (City of Chester) (Lab)]

It is always a pleasure to follow the hon. Member for Rugby (Mark Pawsey). It is a particular pleasure to follow my hon. Friends the Members for Sheffield South East (Mr Betts) and for Liverpool, Riverside (Dame Louise Ellman), both of whom came to the House with long and distinguished careers in local government, and indeed having achieved positions of national prominence. We can learn from their experience.

It seems clear from the debate that the Government have a two-pronged approach. The first is cynically to try to divide rural and urban areas. It will not work in my constituency because there are both urban and rural areas in it. The second is the cynical modus operandi that I have mentioned previously of slashing support to public services, then blaming local authorities for failing to deliver them, or when they are forced to put up the council tax.

For example, it is slightly off topic, but we are campaigning to bring a second fire engine back to Chester, yet the fire authority’s funding will fall to zero next year. Local Conservatives have the nerve to support that campaign, even though their party introduced the cuts.

In the previous debate, hon. Members talked about the increase in knife crime. The Mayor of London is often blamed for a rise in knife crime in London, despite the fact that across the country 20,000 police have been cut. The problem intermeshes with the cuts to local government that we are discussing. Children’s services and money to schools have been slashed. It is no wonder that knife crime has increased, but apparently it is all the fault of the Mayor of London and others.

That brings me to the settlement for my council, Cheshire West and Chester. For the last four years, the Labour council, led by Samantha Dixon, has had to deal with a £57 million cut. Since 2010, the cash cut to my local authority has been £330 million. In the next round, which we are discussing, a further £20 million will be cut, despite the fact that that extremely efficient council, which is down to its bare bones, is already running on empty. If the Secretary of State had any courage or sense of responsibility, he would tell us where he thinks those cuts should fall. Should they be to support for vulnerable children, disabled adults, the homeless—homelessness has of course doubled nationally on the Conservatives’ watch—or rural bus services? Ministers will then of course attack our council leaders when we are forced to put up council tax.

My hon. Friend the Member for Denton and Reddish (Andrew Gwynne) pointed out that all the additional spending power is created only from increases in council tax, but the situation is worse than that. The rate support grant is largely being replaced by individual pots for which councils have to bid in a beauty contest: money for potholes; money for rapid rehousing; support for high streets; extra cash for children’s services. Councils have to go cap in hand to Ministers every time they want to fund anything, and Ministers can cherry-pick their favourite councils. We all know where that money will go.

The Government are centralising expenditure and taking away local democracy. They have announced extra money for 20 councils to support children’s social services. I can make a fair guess that the majority of those councils will be of a particular political complexion, and they will not be Labour. There will be another special deal for Surrey or, as we have heard tonight, for Tory Northamptonshire.

Meanwhile, locally, the Minister’s fellow Conservatives in Cheshire West and Chester want to spend more money supporting free parking and on mowing the grass while criticising Labour locally for having to put up the council tax. Those are both worthy aims, but those Conservatives need to do locally what the Conservatives have so far failed to do nationally—namely, to say which services will be cut to pay for the increased expenditure. If I may, I will briefly cross over the border into Cheshire East, because this has implications for the Minister. Madness still reigns there, with police investigations, corruption allegations and a whole series of chief executives and senior officers being sacked. I say to the Minister that if that were a Labour council, the commissioners would have been called in years ago.

Ministers are driving ahead with plans to keep 100% of business rates, which means that the richer councils will get richer and the poorer areas will be made even poorer. The Conservatives will use that business rate revenue to keep their council tax rises low, then claim political credit because the funding formula has been cut back. Cuts are forcing local authorities and other public services to hunker down and defend the money that they have. In Cheshire West and Chester, we are trying to build local partnerships with voluntary groups and charities, but that is not sustainable for long. At some point, Ministers will have to take responsibility for the dreadful effects that their cuts are having in the real world.