Local Government Finance (England)

Diana Johnson Excerpts

Wednesday 13th February 2013 Commons Chamber

[Diana Johnson (Kingston upon Hull North) (Lab)]

I have listened carefully to the debate and I have to say that the Government are out of touch with what is going on in many parts of the country. I want to talk about what is happening in my home city, because the disproportionate nature of the cuts in Hull needs careful examination.

In the past two years, Hull has lost £163.50 per person, compared with a national average of just £74 per head. From the cumulative figures that have been provided by Newcastle city council, it appears that, over the four-year period, the figure for Hull will rise to £228.36 per head. Hull is taking a much larger share of the Government’s council funding cuts than many wealthy areas. When I looked through the figures, I was particularly struck that West Dorset district council was losing only £2.70 per head.

We know that, from April onwards and up to 2015, Hull will lose a further 7.2% in what the Government are now calling “spending power”. As has already been said, the Prime Minister’s West Oxfordshire council will be receiving a rise, even though it is the 316th least deprived local authority area out of 325. Hull is the 10th most deprived area and is taking a much larger cut. That is not fair, and I think that that unfairness forms the basis of the objections of many Labour Members—the lack of fairness in the distribution of the cuts that are taking place.

[Annette Brooke]

Will the hon. Lady clarify whether she was comparing like with like, given that West Dorset is a district council and Hull, I presume, is a unitary council?

--- Later in debate ---

[Diana Johnson]

That is an interesting point. One of the issues the Government have to face is that they are using all sorts of different terms and ways of describing the funding that is going to local authorities. What I know is that in Hull the cuts are much deeper than they are in many wealthier areas. The citizens of Hull know jolly well that, with a Liberal Democrat-Tory Government, areas in the north are being disproportionately impacted.

[The Parliamentary Under-Secretary of State for Communities and Local Government (Mr Don Foster)]

rose—

[Diana Johnson]

I will not give way to the Minister because I only have a few minutes and he will have lots of time to peddle his view of what he believes is happening. It is clear that areas such as Newcastle, Manchester and Birmingham are being disproportionately hit.

[Julie Hilling]

These figures are calculated as a per capita cut. My hon. Friend may be interested to know that the citizens of West Dorset are getting only a £47.44 cut.

[Diana Johnson]

I am grateful to my hon. Friend for providing that figure. As I said, that compares with the cumulative figure over four years of £228.36 for Hull residents, and that is just not fair. The case that I am putting to the Government is that they need to think again if they want to rebalance the economies of the north and the south. This is just another hammer blow to economic regeneration in the north, and to cities standing up and paying their own way. It will not help my city of Hull, which is struggling at the moment. Just before Christmas we saw 1,200 job losses in the local area from the private sector.

I pay tribute to the work of Hull city councillors who are trying to work with the budget they have been given by the Government. They have been put in a very difficult position. My hon. Friend the Member for Sheffield South East (Mr Betts), the Chair of the Communities and Local Government Committee, set out clearly the important work that local councils do on environmental health and trading standards, and in looking after some of the most vulnerable and damaged young people in our society—looked-after children, and elderly and disabled people who need social care. The councillors in Hull are doing their best to make sure that they can cover as much of those services as possible, but the Government are making it completely impossible to provide the kind of services we need in an area with such disadvantage.

[Andrew Percy]

rose—

[Diana Johnson]

I will give way to the hon. Gentleman. As a former Conservative councillor in the city —just one of two—he often spoke up for his constituents, but I am surprised that he now feels that the cuts being imposed on his former constituents are fair.

[Andrew Percy]

What I clearly remember from my time as a Hull councillor is that, at the end of the last Labour Government, we had fewer jobs in the city than we had at the beginning. I also remember Labour frittering away the KC money. Public health funding in Goole will be £27 per ahead, but in Hull that figure is four times greater. Is the hon. Lady defending the fact that people in Hull, which has a similar demographic profile to Goole, have four times as much spent on their public health as somebody in my constituency?

[Diana Johnson]

I am sure that the hon. Gentleman would not argue that people in Hull should lose the money they need to deal with health inequalities and that that money be given to the people of Goole. Surely, he should fight his corner for the people of Goole and ensure that the Government provide the necessary funding.

I am reminded of the 1920s and the dispute involving Poplar borough council. We had a Liberal-Tory coalition then, and the good councillors of Poplar had to fight their corner then, because of the nature of the cuts being imposed on poorer areas of the country. It was generally accepted after a High Court ruling that richer areas should subsidise poorer areas, but of course the Government are rowing back completely on that and reverting to the idea that everywhere has to cope on their own, as a result of which the wealthy areas do well and the poorer areas sink without trace.

The new homes bonus will not help areas such as Hull. It is the wealthier areas that benefit from new homes being built. The Liberal Democrats like to talk about the pupil premium, but in 2011-12, Hull city council had £6,516 per pupil to spend on education and support services, whereas Kensington and Chelsea could afford to spend £8,920 per pupil. My constituents know jolly well what the Government are doing to the funding available to them and other northern cities.

This is a time for people in Hull to come together, and that includes the Liberal Democrats. There was a brief flirtation with the Liberal Democrats in Hull, but I think that most people there now recognise what they really are—Tories. People in Hull now recognise that this is not a fair settlement from the Government. We need to stand united in Hull, just as people in Newcastle and other parts of the country are standing united, and say, “Enough is enough.” The bedroom tax, council tax benefit—they cannot keep doing this to cities that are already struggling. I call upon the Minister to address the inequality in the cut given to Hull in particular and to explain it to my constituents, because they do not understand why they are being so penalised. They are doing their very best, living on limited incomes, working as hard as possible and looking for extra work when possible, yet the Government, time after time, seem hellbent on making the poorest pay the most. It is not fair.