Local Authority Funding

Debbie Abrahams Excerpts

Tuesday 3rd December 2013 Westminster Hall

[Chi Onwurah (Newcastle upon Tyne Central) (Lab)]

Mr Streeter, it is a great pleasure to serve under your chairmanship for the first time, particularly in this most important debate, which I was delighted to secure.

Local government finance holdbacks may not, on the face of it, be the most exciting subject to be debated in the House, but the issue is central to the daily experience of so many of our constituents. Indeed, for my constituents in Newcastle upon Tyne Central, this is probably the most important debate that I have secured. It goes to the heart of the delivery of public services—services that are delivered mainly, and increasingly, by local councils—and ultimately affects how many potholes are filled, how many homes are built and how well our buses are run.

I have come here not to ask the Minister for more money, although if he has found some that would be great, but to examine how we might best use what we have and how we can ensure that fairness, which is so ingrained in British values and culture, is at the centre. I hope that he will engage with the debate constructively and that he will not use the autumn statement and the upcoming settlement announcement to hide from what I am sure he knows are the serious concerns of councils throughout the country, of all political persuasions.

We can agree, at the outset, that we all want a system of local government financing that is fair, transparent and allows councils to plan ahead, as far as possible. Although I will speak mainly about the impact on Newcastle, the issues we face there are the same as those faced by many councils across England, particularly, but by no means exclusively, in urban areas.

Shortly after the election, the Prime Minister said,

“This government will not cut this deficit in a way that hurts those we most need to help, that divides the country, or that undermines the spirit and ethos of our public services”.

I was so pleased to secure this debate, because that is exactly what the current local government finance proposals will do. We in this country pride ourselves on a sense of fair play. Fairness is, these days, the political centre ground and everyone wishes to position themselves on it. This Government are finding that if a policy, such as letting energy companies hike up energy prices in the midst of a cost of living scandal, is seen as unfair, you lose—except, perhaps, if that policy is wrapped up in enough accounting doublespeak and councils are blamed for not implementing what the Association of North East Councils has called “impossible cuts”. It seems that, if that is done, one can get away with it. ANEC says that, since 2011, councils have seen a one third reduction in funding—a staggering amount—and estimates that by 2017 funding will have been cut by 50% in real terms.

I emphasise that this debate is about not the overall spending level—I know that the Minister does not decide that—but how we distribute what we have. Analysis of the Government’s proposals for the next local government finance settlement by the special interest group of municipal authorities, which is a group of urban councils within the Local Government Association, found that municipal authorities

“started off from a position of disadvantage; have borne a disproportionate burden of cuts under the Spending Review; and carry the greatest risk of the highest cuts in the future.”

The insidious nature of this Government’s top-slicing and holdbacks in particular will have an impact on services for people struggling through the cost of living crisis in Newcastle and similar towns and cities.

Councils must be in a viable financial position if they are to fulfil the statutory burden that Whitehall places on them. On top of that, we expect them to be—indeed, we insist that they should be—active partners in driving forward economic growth, yet the north-east has endured the biggest cuts, with higher reductions in spending power than the national average. In the spending review, we were told to expect 10% cuts in core funding, yet the north-east is now looking at a real-terms cut of 25% when social care costs are included. That is putting public services under severe strain.

At the beginning of the year, the Department for Communities and Local Government estimated that next year Newcastle would see a cut per dwelling of £126, compared with an average cut in England of £75 and a cut in Wokingham, for example, of £19. It later emerged that those figures for Newcastle were significantly understated. At a time when demand for services in the north-east is increasing, why does the Minister think that targeting areas with higher levels of deprivation to make savings is the fairest way to implement these cuts? Will that not hurt

“those we most need to help”,

to use the Prime Minister’s words? I urge the Minister to respond to that question in particular and I am sure that he will.

Has the Minister considered allocating cuts to councils by an equal percentage, based on spending power? Would that not be fairer? If not, why not? By what process did he decide that his current proposals are fairer and will not disproportionately hit the most deprived? I ask him to publish any evidence that is to the contrary of the Audit Commission’s report, among others, which sets out how deprived areas will suffer more than wealthier ones and to which Sir Merrick Cockrell, the Conservative leader of Kensington and Chelsea council and chairman of the LGA, responded:

“The report highlights a significant variation in the impact of the cuts at a local level, with a number of places taking a disproportionately heavy hit. It provides yet more evidence that the existing system of funding is too exposed to the vagaries of national politics and incapable of delivering the long term certainty that local areas need to deliver consistently excellent services.”

[Debbie Abrahams (Oldham East and Saddleworth) (Lab)]

My hon. Friend is making a powerful speech. Does she agree that, in addition to the cut in revenue support grant for Newcastle upon Tyne Central, there has been a disproportionate cut in the revenue support grant for Oldham, a metropolitan area with two Members of Parliament? In fact, in 2014-16, that will have decreased by £36.8 million, which will, unfortunately, not be recouped by the new homes bonus, for example, which has raised just £700,000. I support her argument. Does not that cut put dreadful pressure on the council, which provides services such as social care, and does it not impact on constituents?

[Chi Onwurah]

I had the pleasure of visiting Oldham not long ago, and my hon. Friend is absolutely right to highlight the disproportionate cuts that Oldham is suffering under this funding approach. I will speak about the new homes bonus shortly. The Government claim to be giving money to councils such as Oldham and Newcastle, but they are in fact taking away far more than they are giving.

The Audit Commission estimates that one third of councils, many of which are in the most deprived areas, are at risk of financial failure in the medium term under current proposals. An equal percentage cut based on spending power would bring significant benefits to many of those deprived areas across the country, not only in Newcastle and London but in the north-west and the shire counties and districts.

Children’s social care is an area of particular concern as we see growing need and reduced funding. In Newcastle and the north-east, there are real and growing concerns about the pressures on children’s services. Indeed, I recently looked at a website containing anonymous reports from social workers working in children’s services, and it was a frightening insight into the pressures that they face.

The number of looked-after children is growing at 11% nationally, with higher pressures in the north-east. Councils have seen a 4% cash increase in costs, but DCLG and the Department for Education have cut children’s social care funding by 30%. Children’s social care assessment was cut by 30% between 2010 and 2013-14, which is about four times the assumed cut, while the number of looked-after children has increased by 31% in the north-east since 2009. Budgeted spending on children’s social care rose by 4% nationally, but by just 1% in the north-east.

When ANEC raised concerns, the response by Ministers at the Department for Education was that councils would have to find the cuts “somewhere else.” It is difficult to see how a further 25% cut in core funding in the north-east can in any way be justified. How can it be taken out of children’s services over the next two years? Will the Minister explain why spending on children’s social care has been cut so much when the levels of need are increasing?

Ministers like to come up with complex formulas for giving money to councils that tend to benefit wealthier authorities, but when it comes to cutting money, Ministers are increasingly turning to crude holdbacks and top-slicing from the central revenue budget. It is possible that not everyone here is familiar with holdbacks. Indeed, I confess that, prior to entering Parliament, I did not follow the intricacies of local government financing with as much attention as I possibly should have. I dread to think how much excitement I have missed as a result.

A holdback is when Ministers or civil servants decide that money allocated to councils will literally be held back by Whitehall for a specific purpose or on a certain condition, which, again, disproportionally affects the most deprived councils. Money is being cut from the central pot, the revenue support grant, which automatically means that councils with the highest need lose out the most. If the Minister decides that he wants to hold back £500 million, for example, it comes from the central budget, which means that all councils lose a slice. The councils that would have received a bigger slice, because they have greater need, lose out more. A holdback of £500 million would mean that Newcastle loses £4 million, whereas Wokingham loses only £400,000. That is a £32 cut per household in Newcastle and a £6 cut per household in Wokingham. Authorities such as Hackney and Birmingham are even worse off, at £50 and £37 per household respectively. All authorities would then get some money back, but if the funding is skewed to favour wealthy authorities, as it so often is under this Government, the effect is a budget transfer from poor to rich, which is Robin Hood, disguised as a Whitehall accountant, in reverse. That is not a pleasant sight.

Parliament has decided that the money should be used to fund councils for services that they have a legal duty to provide. SIGOMA, ANEC, the Audit Commission and the Joseph Rowntree Foundation have all highlighted the problem, so will the Minister explain whether he agrees with their analysis? With what does he disagree? Why are the Government increasingly using holdbacks to fund projects?

This week, we have been reading in the papers that on Thursday the Chancellor plans to cap business rate rises. With small business Saturday this weekend, it would surely have been more appropriate and beneficial to local economies if he had stolen another Labour policy by cutting and then freezing business rates. The Chancellor should not feel shy.

When councils were told that business rate takings were to be localised, thereby shifting the risk on to the councils, I do not think they expected that any potential reward would be offset by equal cuts to their revenue funding. The business rate safety net is yet another example of how unfair holdbacks can be for poorer areas. Will the Minister tell us whether the business rate safety net is flawed? Was it designed on purpose so that councils such as Newcastle end up funding shortfalls in business rate takings in Westminster by a staggering amount?

The safety net—again, this a technical description of a complex area—provides funding for any council for which business rate receipts fall more than 7.5% below its baseline funding level. The safety net is funded by a levy on councils for which the increase in revenue from business rates outstrips the increase in its funding level and holdbacks.

A holdback of £25 million was originally created to fund the difference between levy funds and safety net payments so that all authorities would fund the safety net. The history is quite complex, but what is crucial is that, because the estimated levy amount has proved inadequate, the top-slice holdback has been increased to £120 million next year. That is a staggering increase, and SIGOMA says that, because of the system’s design, Westminster city council will claim more than two thirds of the national £79 million safety net pot next year. That is two thirds for one of the richest councils in the country. Again, funding is disproportionately going from poorer areas to richer areas.

--- Later in debate ---

[Chi Onwurah]

My hon. Friend makes an excellent point. I was in the Chamber when it was revealed that the new homes bonus’s purpose was not to build new homes, which reveals a subtlety of language that I confess is beyond me. It is clearly of concern, and I am sure that the Minister will explain not only what the bonus is achieving, but how we can ensure that it is more fairly distributed, so that Newcastle and other authorities are not disadvantaged.

Will the Minister also explain why the figure in the settlement paper for 2015-16 is £210 million higher than that quoted in the new homes bonus consultation, which was based on an estimate from the National Audit Office? Would he consider using the National Audit Office figure? The Local Government Association estimates that £210 million would cover the cost of filling 4 million potholes or 30% of the country’s street-cleaning bill for a year. It would be good to know what has happened to and what is being done with that money.

Finally, I want to discuss the stability and transparency implications of the Government’s use of holdbacks. It is essential that councils get consistent figures when planning budgets. Newcastle city council has identified several other holdbacks, amounting to over £550 million next year and a massive £1.5 billion the year after, that would be better either returned to core funding or funded through other means. The holdbacks include capitalisation, the collaboration and efficiency fund, the fire transformation fund, the independent living fund, the troubled families fund and the money for the new social care burdens. I would welcome the opportunity to discuss them in more detail with the Minister if he feels that he does not have the time to speak to each today.

[Debbie Abrahams]

I congratulate my hon. Friend on securing the debate and on her speech. We are really getting to the nub of the issue. Although we have been discussing cuts to council funding, it is ultimately about the cuts to services and the impact on our constituents’ lives. The independent living fund and the social care issues, with a particular focus on children, are affected, but so are adult carers. People’s lives are being detrimentally affected, but it does not seem a priority for the Government.

[Chi Onwurah]

My hon. Friend is absolutely right. I pay tribute to her for the passion that she brings to the subject.

As I said at the beginning, the subject appears dry, but my post box and surgeries reveal the daily impact of cuts to the funding of services and the progressive and cumulative impact on the lives of often vulnerable people, who find not only an impact on housing and social care, but that their streets are not as clean, that their environment is more depressing and that schools do not have the same resources. That impact is partly a consequence of holdbacks. These dry financial mechanisms are holding back the services that my constituents and so many others need. We need to focus on that. It is important that the Minister identifies and explains why this is happening and what he can do to stop the impacts that we are talking about.

I have one overarching point for the Minister. The mechanism is regressive and effectively moves money to better-off areas, but it is also opaque and severely limits councils’ ability to plan in advance. Will he work to ensure that future rounds of local government finance settlements are conducted more transparently? Ministers have found ways to give varying protection to some more visible services, but that increases the pressure on other funds. When the Minister chooses to protect London transport funding by 6%, money for children’s social care and libraries is squeezed in Newcastle.

I want to bring the Minister back to the Prime Minister’s quote about tackling the deficit:

“This Government will not cut this deficit in a way that hurts those we most need to help, that divides the country, or that undermines the spirit and ethos of our public services”.

Does the Minister think that the Government’s approach to local government finance has been fair and in the interests of councils’ ability to plan for the long term?

I urge the Minister to listen to councils throughout the country, to find an alternative way to reduce the additional cuts by reducing council holdbacks and top-slices. That will help all councils to prevent further unnecessary service cuts and job losses. It will also help them to stabilise their finances, at a time when one third of them face serious financial failure in the medium term.

Two weeks ago, I visited St Paul’s Church of England primary school in my constituency and was given an excellent tour by the head, Mrs Judith Sword. I also held a question-and-answer session with the year 6 pupils. One of them asked me why the council did not spend its money better, so that the libraries could stay open. I explained that the council was losing a third of its budget, or more than £100 million—at that figure, there was big “Oh!” of shock in the room—but that it had consulted more than 50,000 residents to decide the fairest way to implement the cuts. I did not add, because I did not want to over-complicate my answer, that there was not really any such thing as the council’s money any more, because so much of it was being held back by the Government and redirected to other purposes, so that the council could not plan. I hope that the Minister understands how unfair that is to the children and adults of Newcastle and, indeed, to all the children and adults in our constituencies throughout the country.

--- Later in debate ---

[Andy Sawford (Corby) (Lab/Co-op)]

It is a pleasure to serve under your chairmanship, Mr Streeter, for what I think is the first time—certainly in my role as Opposition spokesman on local government matters, including local government funding, which I shall talk about today.

My hon. Friend the Member for Newcastle upon Tyne Central (Chi Onwurah) opened the debate by saying how important it was for her constituents. I congratulate her on securing it, and I thank her for doing so, because my constituents are also concerned about local services. Earlier today, I met 25 members of the University of the Third Age, from Thrapston, a small town in my constituency, and the topic of conversation was the impact of various funding cuts on their lives. They talked about having to pay £6 a week for the Lifeline service in sheltered accommodation, which was previously paid for out of the Supporting People funds. They also talked about the impact on their communities of further cuts to bus services. My county council has reduced the subsidy for local authority bus services by more than any other county council. My constituents said, “What is the point of a bus to a nearby town if I can’t get back from it?”

My constituents also spoke about the isolation that they experience as elderly people. They talked of their concerns about their grandchildren’s school transport costs. They highlighted the impact of cuts to police community support officer funding in their small market town, which have happened partly because local authorities can no longer fund partnerships. My constituents are also concerned—my hon. Friend mentioned this—about potholes and cuts to funding for other things that they see every day, such as street lights. This is therefore an incredibly important debate.

My hon. Friend said the Government’s changes to local government funding fundamentally impact the spirit and ethos of how public services are funded, and I wholeheartedly agree. She spoke passionately about the unfairness of the cuts, as did other hon. Members, including my right hon. Friend the Member for Newcastle upon Tyne East (Mr Brown). He said that, in his 30 years in this place, he has not seen anything handed down to communities that is as unfair as these local authority cuts, which are particularly impacting on his city. They are also impacting on Oldham, the local authority of my hon. Friend the Member for Oldham East and Saddleworth (Debbie Abrahams).

My hon. Friend the Member for Newcastle upon Tyne Central drew on comments from the Conservative leader of the Local Government Association, so it is not just Opposition politicians who are raising concerns. Sir Merrick Cockell said that the cuts were having a disproportionate impact on some areas of the community. Recently in the House, the hon. Member for Cambridge (Dr Huppert) said that his local authority and many other local authorities around the country were being “cut to the bone”, but the Government have failed to recognise the very real impact that the cuts are having.

I was struck by the summative description of the cuts that my hon. Friend the Member for Newcastle upon Tyne Central gave: she said that they were Robin Hood in reverse. My right hon. Friend the Member for Newcastle upon Tyne East simply suggested that their impact was wicked. It is not just that funding is being cut. As we all recognise, this is a time of rising pressures. In particular, Members have talked about the costs of dealing with looked-after children. My hon. Friend the Member for Newcastle upon Tyne Central highlighted the 11% growth in the number of looked-after children across the country, and the rate is higher in her area, as we might expect because of the nature of her community. Clearly, it compounds the problem when such a significant cut is meted out to her local authority.

My hon. Friend the Member for Oldham East and Saddleworth spoke passionately, as she always does, about social care. She talked about how the cut in the independent living fund is impacting people in her community. Not only are local authorities meeting only severe needs, but they are being forced to reassess elderly and vulnerable constituents who were previously considered to have severe needs, and are beginning to withdraw the services that those people had come to rely on, leaving them incredibly worried. In some cases, that has perverse consequences. Local authority social care cuts are causing hospitals to use acute hospital budgets to fund social care beds. Surely the Government cannot see that as a good use of public money.

[Debbie Abrahams]

My hon. Friend is making a passionate speech himself. These measures are having an impact on not only local authority services, but the NHS. As we know, we have an accident and emergency crisis across the country, and that is partly because of the impact on social care.

[Andy Sawford]

My hon. Friend is absolutely right. She has considerable expertise in these matters, and I have heard her speak frequently about them in the main Chamber. In my area, the A and E crisis, which means that many people have to wait more than four hours, is happening because the hospital is running “hot”. I do not know whether you have heard that term in relation to your local hospital, Mr Streeter, but it means that the beds are full, and that is partly because there are no social care beds. The services that should help people to return home are not being put in place properly or quickly enough to do that. These things are very much linked, and I hope the Minister will acknowledge that in a way that other Conservative Members have failed to do in some of our debates on health care, and on the impact of local authority funding cuts on a much broader range of public services.

We have quoted Sir Merrick Cockell, the LGA’s Conservative leader, who has called the cuts “unsustainable” because of their scale and pace and the rising demand we have highlighted. The Conservative leader of Kent county council has also said that his county cannot cope with further reductions, and that it is “running on empty”.

Ministers know that local government is the most efficient part of the public sector—the Prime Minister has said so—but they have decided to reward councils for that efficiency by cutting more from them than from any other part of the public sector. Indeed, the Secretary of State for Communities and Local Government approached the Star Chamber to bid for that substantial cut to local authority funding.

The Institute for Fiscal Studies is clear that the total cuts to local government spending will outpace those in the public sector as a whole, and the situation will get worse, not better. The LGA’s excellent report, “Future funding outlook for councils”, incorporates the 10% cut in this year’s spending review, which comes on top of the 33% cut that councils face over this Parliament, and that includes the issue of holdbacks, which I will come to in more detail.

The Minister will no doubt tell us that there has been a 2.6% cut—I hear those figures all the time, and I heard them again on “Look East” just the other day. At the same time, the leader of Norfolk county council was talking about what, by anybody’s measure, was a cut of a third to the council’s budget. Councils simply do not recognise this 2.6% figure; it does not stand up to scrutiny.

The black hole will get bigger: by 2020 there will be a £15-billion black hole in the finances, but the Secretary of State talks about council cuts as though they are modest. I do not think that it surprises any of us when Conservative council leaders raise complaints with the Prime Minister about the language being used, and the reality gap between how Ministers at the Department for Communities and Local Government talk about the level of the cuts, and council leaders’ experience of trying to deliver public services around the country. I have spoken to the leader of Northamptonshire county council. He is a Conservative politician, but we have a constructive dialogue about how we are grappling with huge changes. For example, he is currently scratching his head about how we will sustain Sure Start and children’s centre provision across the county, and how we will continue to provide libraries across a large county.

Leaders of any party know the reality out there, but the Government will not listen to the warnings. They will not listen to the National Audit Office, which has said that cuts are having a direct impact on front-line services. The myth created in the early days of the coalition—that everything could be achieved through efficiencies—simply does not match up to reality. The NAO says that 12% of councils are at risk of being unable to balance their books. That will have disastrous consequences.

The Minister told me in a written answer last week that a response to the Public Accounts Committee report on the financial sustainability of local authorities had been published in September. I cannot find that response, and would be grateful if he could draw my attention to it more directly. It seems that the Government simply do not know how they will respond when councils fall over. The permanent secretary to the Department for Communities and Local Government, when questioned by the Public Accounts Committee, said that councils have a duty to balance their books. Ministers are relying on a statutory duty in the face of reality.

Of course, we know that councils will do their very best, because they will want to ensure that they comply with the law. They will be well advised by their monitoring officers and finance officer. Councillors will want to balance the books. They will know that that will be audited by the new independent local auditor, so they will have to do it—and we know how they will do it: by turning off the street lights; by further cutting social care; by ending the use of the local swimming pool; by closing the libraries; and by stopping maintaining the streets. If they have to, against the Secretary of State’s best wishes, they will do it by stopping some bin collections, which will affect our recycling rates. They will do it by cutting services around the country.

Some councils will find more quickly than others that they need to balance the books. They will not be councils in the north of England only, although many councils there will find themselves in particular difficulty. It is one of the poorest regions in the country, and my right hon. Friend the Member for Newcastle upon Tyne East and my hon. Friend the Member for Newcastle upon Tyne Central are to be congratulated on highlighting the impact on their region, as the Association of North East Councils has also done very powerfully.

Councils all around the country will be affected. We are told that Tory-led West Somerset will be one of the first councils that will have to close its doors and will simply not be able to balance the books. As I understand it, there is an idea that such councils will be taken over by their neighbours. I think that that is the Government’s way forward: the neighbours will step in. However, although I am a co-operator, I must say that when faced with a neighbouring authority that is about to fall over, it would not be prudent of any hon. Member to encourage their own local authority to take on the burden of financial responsibility. The crisis has been created by central Government, and they must face up to it and tell us what their response might be.

--- Later in debate ---

[Brandon Lewis]

The hon. Lady’s point highlights where we are. The current structure for local government is that councils will benefit and see their income rise as a reward for the good work that they do for their communities. I will touch on that directly.

Manchester, Liverpool and Newcastle all have higher spending power per dwelling than the national average. When talking about what local areas have, it is important to put that in the context of the starting point. The average reduction in spending power is only 1.3% this year and we are protecting individual council tax payers by offering a council tax freeze. We are protecting councils through the rates retention scheme’s safety net, which generates a minimum level for their baseline funding, which Newcastle will benefit from, although it was unable to do so previously.

The settlement is fair because even for councils like mine, which now benefits from the efficiency support grant, we have provided protection for those who were hit worst by the policy decisions of the previous Government, and that brings me to the important point of how the system now works in a council’s favour. Following the Localism Act 2011 and financial reforms to the settlement, 70% of an authority’s income is raised locally and, most importantly, the growth incentive ensures that local government will keep up to 50% of all the growth that it generates. Councils have more power than ever before, but they must understand the implications. They must act in their residents’ best interests and work hard on their behalf. Redesigning council tax benefit to cut fraud, which costs around £2 billion, promoting local enterprise and getting people back into work, or redesigning services to make them more efficient and sustainable, especially as there are still savings to be had across the sector, all make a difference.

Some cutting-edge councils understand that and lead by example in developing good practice for the rest of the country to follow. Getting the ball rolling can be the hardest part of radically overhauling local services. The Government established the transformation challenge award to help councils, particularly small ones, to demonstrate innovation, to protect services and to reduce costs to the taxpayer. Just a few months ago, I was pleased to announce 18 successful schemes, including projects to accelerate the integration of local health and care services, which hon. Members have outlined this afternoon, and to create shared finance and human resources for emergency services.

The £3.8 billion that is coming across from the health service to be part of the local government family to provide adult social care is an indication of the work that follows on from the community budget pilots. That transformation touches on the point that the hon. Member for Corby made and is an important way to bring the public sector together and to drive out duplication and provide better services. We know from the community budget pilots that up to £20 billion of savings can be found across the public sector if we can get the work done correctly throughout the country. More importantly, they have shown better services for residents and more effective service delivery.

[Debbie Abrahams]

Will the Minister undertake on behalf of his Department to publish information about the impact of the reductions on funding to local authorities and on services?

[Brandon Lewis]

The whole point of the change in the structure of local government finance is that council finance is partly in councils’ control. That is why 40 authorities have had an increase in their income this year alone. Today, a Labour authority has predicted a £500,000 increase in its income over the next couple of years, thanks to the business rate retention scheme. Hon. Members should focus on their councils’ decisions on what services they provide locally. Some £3.8 billion is going to local councils to ensure that they can deal with adult social care in a joined-up way, without creating further bureaucracy.

Local government has shown great skill in moving forward. The Audit Commission and a recent survey noted that residents believe that services have improved. Our community and neighbourhood budgets show that we are finding ways to rewire the system to provide better services at much lower cost.

Turning to the future, I recognise that councils are facing pressures. That is why the spending review set out a package of measures to support them in 2015-16, including the £3.8 billion pool of funding for integrated health and social care, which will help to ensure that services in the care and support system can be protected and will enable authorities to invest in prevention and early intervention.

We will make available a new fund of £330 million to accelerate the transformation of local services with a £200 million extension of the troubled families programme to support another 400,000 families, £100 million to build on the transformation challenge award to improve public service delivery and a further £30 million to drive change in the fire and rescue service. All that together shows that there is a huge opportunity for councils to save money and to achieve better outcomes by working collaboratively and innovatively for their communities.