Local Government Funding

David Ward Excerpts

Monday 6th December 2010 Commons Chamber

[Mr David Ward (Bradford East) (LD)]

I welcome in particular the speech by the hon. Member for Mitcham and Morden (Siobhain McDonagh), one of the few people who seems to have read the motion. Many hon. Members have tried to support or, indeed, argue against the scale of the cuts, but the guts of the motion are really about front loading and authorities’ ability or inability to deal with that in the short term.

Scaremongering has been mentioned, but back in Bradford the council has been working on the figures, and the numbers on front loading are scary. Those are the figures we have been given, so it is a question not of scaremongering but of what we have been given to work on and are working to.

Members have traded stories and histories of their time on local councils. I had 26 years on my local council, 13 under the Tories and 13 under Labour, and with all due respect to my coalition partners, I can tell hon. Members which were the worst by a long way. I remember, back in the ’80s, we had to raise £2.40 to spend £1 in Bradford and send £1.40 back to the Treasury, and it did not get much worse than that, so I am not worried about the Liberal Democrats having only 57—or, soon, 58—Members, because two of us Liberals managed to stop Councillor Pickles slashing the education budget in the ’80s, although unfortunately a by-election and the lord mayor’s casting vote enabled him to do so the following year.

During the 13 years under Labour, additional funding went to the local authority and it was very welcome. Unfortunately, it was accompanied by obsessive control, bureaucracy, targets and the ring-fencing of funds, which would enable Ministers to issue press releases telling us how good they were and what they were doing for the people of Bradford. Building Schools for the Future was a colossal waste of public funds, and if we had been given only half that money to spend in our area on our priorities for schools, it would have been much better.

The cynical use of local services to win Government popularity reached shameful proportions with the free school meals handout and free swimming. It would have cost us 8 million quid to keep free school meals going the year after, and, although the shadow Secretary of State says that we did not turn that money down, how could we? That is how much it would have cost us to keep the service going, and it was pure political cynicism to make that offer leading up to a local election.

Similarly, the area-based grant and the working neighbourhoods fund were time- limited, and, although we got as much as we possibly could because we had things to do with the money, local education authorities invariably required that that short-term funding be added to the base. The position we were in meant we could stop the funding or add it to the base, but if we did not continue with it we would have been the villains of the piece, so invariably we did.

Year by year, the base grew and grew, and all the time we faced the relentless pressures of an ageing population, and all that that meant for increased social care, and the fastest growing school population in the country. In turn, there was budget creep: unsustainable budgets that got bigger and bigger. Between 2000 and 2008, private sector jobs declined by 7.5% and public sector jobs went up by 14%, and that could not be sustained.

Despite all that, over those 26 years the local authority survived. It got through, and it will get through this recession, too. The Secretary of State was absolutely right: we cannot rely on a salami approach any more. The truth is this—it is a secret, so please do not tell anybody else—of the £1.3 billion gross budget that we were spending, we had a furious argument every single year at budget time about a couple of million quid. That was what was really going on, rather than dealing with the structural changes that were required in the authority.

As someone said earlier, necessity is the mother of invention. We are responding positively in Bradford, including the leader of the Labour group who, after six years of self-imposed exile, is actively working as the leader of the council with all the other groups because he understands the severity of the problems that we face. I give him great credit for that. But—and this is the big “but”—we cannot turn the tanker around in a short time. When we are faced with reducing £60 million on a net budget of £450 million, it is not about a planned, structural, cultural local authority change contributing to the deficit reduction programme; it is simply reckless, economic vandalism. That is what we face.

I do not know about other hon. Members, but I have detected a shift tonight on the subject of the front loading. I get a feeling that something has been said and there is something in the air. People might ask, “So why on earth are you making all these comments and raising these concerns?” I would say to them that that is what we have been given to work on and what the directors of finance across the country have been told, and they are acting on it. That is the point I am trying to make. We knew this was coming and we have been told how severe it will be, so we are now making decisions and cutting our budgets. The decisions we are making are not long-term, rational, objective assessments; it is simply panic. We are saving £1 million a month on the vacancy freeze. That is very welcome in terms of helping us with the budget, but it is arbitrary and has not been planned. Such an approach is salami slicing of the worst possible kind and it cannot go on because people will be affected by it.

We need to give local authorities time. They are rising to the challenge, but they need time to achieve what we are asking them to achieve, and we need to work with them. Despite what will happen later, if there were a free vote in the Chamber tonight, I think that the majority of hon. Members would support the motion. What has emerged from the various speeches is a recognition that local authorities need time. I hope that in the winding-up speeches tonight from the coalition side, we are given a very strong positive indication about all the concerns raised on front loading and that we are told it will be abandoned.