Oral Answers to Questions

Elizabeth Truss Excerpts

Tuesday 27th February 2018 Commons Chamber

[Lloyd Russell-Moyle (Brighton, Kemptown) (Lab/Co-op)]

2. What recent discussions he has had with the Secretary of State for Housing, Communities and Local Government on trends in the level of funding for local authorities since 2010.

[The Chief Secretary to the Treasury (Elizabeth Truss)]

It is right that more of our money that is spent locally is raised locally. In 2010, councils were 80% dependent on Government grants. By 2020, they will largely be funded by council tax and other local revenues.

[Rushanara Ali]

Local councils have faced devastating cuts. The Institute for Fiscal Studies estimates that, between 2010 and 2020, councils will have had their direct funding cut by 79%. In Tower Hamlets, we have lost £138 million through budget cuts since 2010. With one of the Conservative party’s own councils going bust, will the Minister now finally commit to funding local authorities properly, so that they can provide vital services to their communities?

[Elizabeth Truss]

As I have pointed out, it is right that we rebalance council spending from central Government grants to locally raised taxes, to help to keep councils accountable. We have seen councils up and down the country finding innovative ways of working, such as sharing back-office services and doing things such as installing wi-fi and improving waste collection. We have also seen Labour councils wasting money. For example, Momentum-supported Birmingham City Council bin strikes have cost the taxpayer £40,000 a day, and Reading—

[Mr Speaker]

Order. Resume your seat, Minister. That is the end of it. You answer for Government policy. You do not waste the time of the House by launching into rants about the policies of other parties. I have made my point, and if the Chancellor is confused about it, he really is under-informed and I say to him: stick to your abacus, man.

[Lloyd Russell-Moyle]

My own council of Brighton and Hove has had to make £52 million-worth of cuts in three years, despite superb Labour leadership in the city. With one of the Minister’s own Tory councils going bust, will the Chancellor finally commit to properly funding local government in tomorrow’s local government finance settlement?

[Elizabeth Truss]

We have provided local councils with council tax flexibilities to enable them to fund spending in their areas. It is absolutely right that councils should not waste money and should find savings. The fact is that we went through an incredibly profligate period under Labour in which the Government were running record deficits, and we have succeeded in reducing the deficit by three quarters. I must also point out to the hon. Gentleman that councils have reserves of £23 billion. In fact, those reserves have increased by £8 billion since 2010.

[John Stevenson (Carlisle) (Con)]

In Cumbria, the Labour council leaders failed to reach a devolution settlement with the Government that would have brought in additional resource. Does the Minister agree, however, that this is not just about resource and that it is also about council structures, leadership and creating efficient organisations?

[Elizabeth Truss]

My hon. Friend is absolutely right. Lots of councils have done things better and more efficiently, and have led the way across government. We have given more powers to local Mayors, and we are giving Mayors across the country £4.8 billion of new investment over the next 30 years.

[Sir Desmond Swayne (New Forest West) (Con)]

What priority does my right hon. Friend attach to local authorities building new housing?

[Elizabeth Truss]

It is vital that we see more housing built across the country, and that is why in the Budget we committed to 300,000 homes a year being built over the next decade.

[Charlie Elphicke (Dover) (Ind)]

Will the Chief Secretary to the Treasury join me in paying tribute to Kent County Council, which has managed to make substantial savings and efficiencies since 2010, while continuing to provide excellent services?

[Elizabeth Truss]

My hon. Friend is absolutely right. We have seen the leadership of numerous Conservative councils across the country in finding new and efficient ways of doing things. That is what we need to do as a Government. We need to find better ways of doing things and more efficiency, rather than wasting money and crashing the economy, as happened under the previous Labour Government.

[Ruth George (High Peak) (Lab)]

23. My county council of Derbyshire has seen its Government funding cut by over £200 million, and two thirds of its spending goes on adult social care. Does the Minister think that a postcode lottery of which counties can afford the most council tax should determine whether their elderly get looked after decently?

[Elizabeth Truss]

We have put additional funding into social care, and we have also allowed councils to raise the precept, but it is a very important principle that local councils are accountable to local voters for the money they spend. The situation we inherited in 2010, when 80% of the money came from the Government, meant we could have profligate local councils and local taxpayers would not have to foot the bill.

[Mr Philip Hollobone (Kettering) (Con)]

This week, having faced the same central Government cuts as everyone else, Conservative-controlled Kettering Borough Council, of which I am a member, can be expected to freeze its council tax for the eighth year in a row. Does it therefore appear that some councils are better at managing their affairs than others?

[Elizabeth Truss]

My hon. Friend is absolutely right. I note that council tax doubled under the previous Labour Government, and we are hearing talk from the Opposition that there might be another rise if they were to get into government again.

[Kirsty Blackman (Aberdeen North) (SNP)]

The issue of public sector pay is inextricably linked to the level of funding provided to both local authorities and other public bodies. Will the Chief Secretary commit to lifting the public sector pay cap across the board and to properly funding these pay increases?

[Elizabeth Truss]

We put an extra £2 billion of spending power into the hands of the Scottish Government at the last Budget, and we have also said that we want to be flexible over public sector pay to make sure we are retaining and recruiting the best possible staff.

[John McDonnell (Hayes and Harlington) (Lab)]

First, if you will forgive me, Mr Speaker, as we came into the Chamber we heard the news of the death of Simeon Andrews, who co-ordinated a large number of all-party groups and trade union groups, and, if we can, I would like us to send our sympathies to his family on behalf of the House.

The ministerial responses we have heard demonstrate absolutely no understanding whatsoever of the crisis created by the cuts of the past eight years and their impact on local government. Local councils are now facing a funding gap of nearly £6 billion by 2020, and it is the most vulnerable in our society who are suffering. The number of children taken into care is at its highest level since 1985, and one in three councillors are warning that the cuts have left them with insufficient resources to support these children. The leader of the Chancellor’s own Surrey council said:

“The Government cannot stand idly by when Rome burns.”

Will the Chief Secretary commit today to use the opportunity of next month’s spring statement to address the funding crisis in our local councils?

[Elizabeth Truss]

First, the spring statement is not a fiscal event, and it is vital that we maintain the discipline that we have achieved over the past eight years and keep control of public spending, because that is what has led to the strong economy we are now seeing, with record levels of employment and an increasing number of new businesses starting up. The reality is that if Labour were to get into power, that legacy would be squandered.

Local government will see a 2.1% increase in cash terms between 2015 and 2019, and, as I have pointed out, they have also seen an increase in local council reserves of £8 billion—money available to spend on, and invest in, local services.

[John McDonnell]

With the crisis in children’s services, to be frank this is not the time for political knockabout responses. I am not sure whether the Chief Secretary has witnessed a child being taken into care; I have, and it can scar that child for life. But do not listen to me; listen to the all-party inquiry into children’s social care, which warned that nine out of 10 councils are struggling to meet their legal duties to children. The president of the Association of Directors of Children’s Services has said:

“We cannot go on as we are”,

and it is reported that over half the councils in England are planning further cuts to children’s services.

Recent estimates of Government spending and income show that the Chancellor will have sufficient resources to protect our children from further cuts. So I appeal—once again—to the Chancellor to use the flexibility he has to use the spring statement to address the £2 billion funding gap in our children’s services, to protect our children.

[Elizabeth Truss]

It is a bit rich of the right hon. Gentleman to suggest that we should not bring politics into this when that is precisely what he is doing. We are making sure that local councils have the flexibility to raise council tax to fund these vital public services. Labour has to acknowledge that this is not just about the money we spend but the way we spend it. The reality is that if the entire focus is on the level of spending rather than what we are doing, we end up with the situation that occurred in 2010—vast increases in spending and services actually getting worse.

[Graham P. Jones (Hyndburn) (Lab)]

3. Whether he has reviewed his Department’s procedures for authorising and monitoring private finance initiative contracts as a result of the liquidation of Carillion.

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[Nick Thomas-Symonds (Torfaen) (Lab)]

11. What equality impact assessments his Department has undertaken on the Government’s policy on the public sector pay cap.

[The Chief Secretary to the Treasury (Elizabeth Truss)]

It is for Departments to consider the equalities impact of their proposals on workforce strategy and pay. The important thing is that we reward public servants fairly for the work they do.

[Nick Thomas-Symonds]

Well, public sector servants have certainly not been rewarded fairly, but let me turn to pay differentials in the private sector. Is the Chief Secretary as concerned as I am that many private sector firms are excluding partners’ income in their reporting obligations on the gender pay gap, on the basis that they are not employees? What will the Government do to close that loophole?

[Elizabeth Truss]

We have announced new policies on reporting the private sector pay gap. The pay gap has come down under this Government and we are now seeing a record number of women in work, and the reason is that we have taken the difficult economic decision to close the deficit and ensured that we have allowed the private sector to flourish.

[David Hanson (Delyn) (Lab)]

17. With inflation at 3% and Government cuts to council tax and police budgets forcing up precepts, why should low-paid workers, who are predominantly women, have an increase of only 1% next year, after four years of 1% already?

[Elizabeth Truss]

First, I point out that those on the lowest pay have seen their real wages rise by 7% since 2015, which is the highest level for some time. Also, it is women who are more likely to be in work, with record levels of employment. We have also given additional flexibility to public services to ensure that they can recruit and retain.

[Imran Hussain (Bradford East) (Lab)]

12. What plans he has to tackle household debt.

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[Fiona Onasanya (Peterborough) (Lab)]

18. What recent discussions he has had with the Secretary of State for Housing, Communities and Local Government on trends in the level of funding for local authorities since 2010.

[The Chief Secretary to the Treasury (Elizabeth Truss)]

We have made sure that local councils have the full ability to serve local residents by giving them additional council tax flexibility.

[Fiona Onasanya]

I thank the Minister for that answer, but between 2010 and 2020, Peterborough City Council will have had its direct funding cut by 78.7%. Can she explain how my authority is expected to meet the rising children’s services and adult social care demands?

[Elizabeth Truss]

As laid out in the local government settlement, councils have been given the ability to increase council tax levels to pay for those services. It is vital that those taxes are raised locally, so that local councillors are accountable for the decisions they make.

[Neil O'Brien (Harborough) (Con)]

Can my right hon. Friend confirm that the Government will move promptly to a new fair funding formula for local government to replace the untransparent and unfair system? Will she look closely at the Leicestershire model for doing that?

[Elizabeth Truss]

My hon. Friend makes a very good point. Local government funding has not been fair enough. That is why we are consulting on a fair formula at the moment, and I will look with interest at his representations.

[Robert Courts (Witney) (Con)]

20. What progress is being made on reducing the deficit.

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[Peter Dowd (Bootle) (Lab)]

The Chief Secretary gave a speech last year calling for better value for money from the public finances and not spending money we do not have, and she has talked about not wasting money today, so how can she justify spending hundreds of millions of pounds on further tax giveaways worth £2,000 per child to the wealthiest families—those, for example, using private schools—via the tax-free childcare scheme? Is that not a waste of money and spending money we do not have?

[The Chief Secretary to the Treasury (Elizabeth Truss)]

I would point out to the hon. Gentleman that the voucher scheme invented by the previous Labour Government benefited only 600,000 families whereas our scheme is much broader—it benefits 1.5 million people—and the Labour Government’s scheme was open to private schools and private nurseries as well.

[Nigel Huddleston (Mid Worcestershire) (Con)]

T3. Last week in the Chamber, we yet again heard an Opposition MP complain that they believed they should personally be paying far more tax. Will the Minister confirm the mechanism by which anybody can currently do exactly that voluntarily?

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[Lilian Greenwood (Nottingham South) (Lab)]

T4. “The health and social care system has been pushed to its limits in recent weeks”—those are not my words, but those of my local hospital trust. Last month, it was forced to cancel about 325 operations and 640 outpatient appointments. That not only means that my constituents who are unwell or in pain are being made to wait longer for treatment but makes the trust’s already challenging financial situation even worse. When is the Chancellor going to give our health and social care system the sustainable funding it needs?

[Elizabeth Truss]

The hon. Lady should acknowledge that the NHS has been rated as the best healthcare system in the world. We recognise that there are extra demands on the health system and that is why we put in an extra £6.3 billion of funding at the Budget.

[Andrew Lewer (Northampton South) (Con)]

T6. What progress has been made in reducing the level of corporation tax evasion?

[Ellie Reeves (Lewisham West and Penge) (Lab)]

T7. Members have already raised the insufficient funding of local authorities by this Government. A recent campaign in Lewisham prevented local children’s and adolescents’ mental health services from being cut, but they are still facing a 5% loss in funding from national Government. When will the Government finally take this seriously and reverse the cuts to children’s mental health services?

[Elizabeth Truss]

We are putting additional funding and support into children’s mental health services and the Department for Education has recently announced additional support for children’s mental health issues in schools.

[Stephen Hammond (Wimbledon) (Con)]

Will my right hon. Friend tell the House what assessment the Treasury has made either separately or jointly with the Department for Transport of how external initiatives on competitiveness and investment might help the rail sector and Network Rail in particular?

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[Ruth George (High Peak) (Lab)]

North Derbyshire clinical commissioning group finished last year £27 million in the red, and £16 million of cuts were demanded. In spite of closing hospital beds at a time when they are most needed, it will again end this year £27 million in the red. When will the Government give the NHS a sustainable settlement to enable it to provide proper services?

[Elizabeth Truss]

We have given the NHS a sustainable settlement. It received an additional £6.3 billion, but it is also important that we reform our healthcare services, that we put in place sustainable transformation plans, and that we are investing in capital and new technology and making sure that we use our fantastic frontline workers—nurses and doctors—in the best way possible.

[Bim Afolami (Hitchin and Harpenden) (Con)]

As the Chancellor knows, investment in infrastructure is key to ensuring that we can build the thousands of homes that this country needs. Will the Chancellor agree to meet me, other Hertfordshire MPs and the leader of Hertfordshire County Council to discuss how we might be able to do that in Hertfordshire, where we need to deliver about 100,000 new homes?