Local Government Funding

Debate between Gerald Jones and Faisal Rashid

Wednesday 27th March 2019 Westminster Hall

[Gerald Jones (Merthyr Tydfil and Rhymney) (Lab)]

It is a pleasure to serve under your chairmanship, Mrs Main. I congratulate my hon. Friend the Member for Colne Valley (Thelma Walker) on her speech and on securing the debate.

Many of the services that are closest to the people we represent and that many people value and appreciate are delivered by local councils. Many of them, such as collecting refuse, recycling, street cleansing, operating street lighting and keeping street drains clear, are easily identifiable council services but, as we know and as my hon. Friend highlighted, councils do much more. They provide education, social and youth services, libraries, community centres, leisure centres, allotments, play areas, car parks, local tourism and business support. They also facilitate a huge amount of partnership working by acting as the conduit for joint working between police, health, the third sector and others. Many local authorities also still provide housing services and even those that no longer have housing stock still provide limited private sector housing support and are responsible for taking the lead on tackling homelessness.

I spent the 20 years before I was elected to this place in 2015 as a councillor and cabinet member. I was first elected in 1995. My first experience as a councillor was marred by the huge financial pressures that local authorities were under. I was full of hope at first that I would play a part in making a positive difference to the community that had just elected me. Is not that why we are all elected? However, the council I was elected to was subjected to massive cuts in my first two years as a councillor. Our annual budget was cut by £30 million over two years. That happened from 1995 to 1997, in the dying days of the Thatcher-Major Tory Government.

From 1997, things changed dramatically and for the 13 years under a Labour Government the council’s funding increased year on year. There were modest increases in the early years but more significant increases followed—in one year reaching almost 10%. Those were years when local authorities thrived. I recall one year when I was the youth champion for the authority and was able to argue for and obtain an additional £150,000 for youth services in the following year. There are many other examples when funding was available to support local services.

[Faisal Rashid (Warrington South) (Lab)]

Local councils provide vital services to our constituents, whether on fly-tipping, homelessness, adult social care or children’s services. Any funding cut is a direct attack on our constituents. Does my hon. Friend agree?

[Gerald Jones]

I certainly agree, because cuts dilute local authorities’ ability to act on behalf of the people they represent.

Local authorities have been at the forefront of strategic partnership working in relation to developing and prioritising projects to secure and utilise European funding and co-ordinating the securing of match funding so that residents get maximum benefit for the investment. That, sadly, will be hugely diminished as we leave the European Union. Despite a promise from the Government they have yet to confirm the mechanics of how the shared prosperity fund will work, which leaves communities to wonder whether the commitment from Conservatives on the leave side who promised that our country would be no worse off was no more than a sop to gain support.

Financial support for local councils started to change in 2010. Since then our local councils and public services have been starved of investment. In Wales, local government is devolved to the Welsh Government and the block grant for the Welsh Government is now some £4 billion less than it was in 2010. In the early years of austerity, the Welsh Government protected councils in Wales from the harsh policies of the Tory-Lib Dem coalition. I remember speaking to local government colleagues in England at the time and hearing the horror stories about how council services were starved of investment. As the years have passed and austerity has continued to bite hard, the ability of Welsh Government to protect local councils has been diminished. Although in Wales the responsibility for local councils lies with the Welsh Government, I am in absolutely no doubt that the cause of the pain being felt by councils and public services in Wales lies with the harsh austerity policies of this Tory Government.

In the most recent budget round, Merthyr Tydfil County Borough Council and Caerphilly County Borough Council, which cover my constituency, were again forced to cut millions of pounds from their annual budget and they have also been forced, along with many authorities across the UK, to increase the council tax by more than 5%, which has been the maximum upper limit in recent years. Some councils are even starting to use reserves to plug the revenue gap, which is a dangerous precedent. Reserves are often earmarked for specific commitments while the much lower free reserves are there for emergencies and one-off expenditure. As we know, once they are used to plug the gap in revenue funding, greater problems are created for future years.

We have heard in recent debates in the House that cuts to policing have had a big impact in many communities where crime and antisocial behaviour have increased. However, that is exacerbated by the fact that, owing to cuts to council services, there are fewer youth workers, education welfare officers and social workers, and generally less funding for work with the police and partners to manage antisocial behaviour and reduce crime. Local councils play a huge part in crime reduction and in reducing low-level nuisance and antisocial behaviour. We should not underestimate the importance of their role.

In conclusion, in the early years of austerity some local councils and public bodies were able to find efficiencies to make their budgets stretch. People were expected to do more with less money and fewer people, which put remaining staff under increasing pressure. However, after nine years of painful austerity there are no more efficiencies to find. The low-hanging fruit has all been picked long ago. As I said in questions on the spring statement a few weeks ago, all that is left to cut is jobs and frontline services.

I make a plea to the Minister today to recognise the pain that austerity has caused and the fact that local councils are not able to withstand any more cuts. The Government need to show compassion. The services that we are discussing are those closest to the people. We know from press reports that Tory-led councils are also experiencing financial pressures. People are feeling the pain across the country, so please will the Minister give us some hope that austerity really has ended?