Local Government Finance
Debate between Grant Shapps and John Redwood(13 years, 5 months ago)
Commons ChamberRead Full debate Read Hansard Text
Grant Shapps
I am extraordinarily grateful to my hon. Friend for raising that sensitive local issue, which she will understand I cannot comment on as a Minister with responsibility for planning. It is true that councils that have used procurement wisely, for example through online procurement, competitive working, ensuring that they follow through on getting a purchase order, which is pretty basic, and paying only when they can prove that the goods have been delivered, have saved millions of pounds.
Mr John Redwood (Wokingham) (Con)
Will the Minister confirm that next year he proposes absolutely no decline in aggregate Exchequer finance, which is going to be about level, and a £1 billion increase in total grants and special grants to local authorities? The Opposition are rather overdoing the gloom.
Grant Shapps
My right hon. Friend is absolutely right to pre-empt a later section of this message, which is that the reduction in local government spending power is now coming down to 3.3%. Last year it was 4.4%, so it is true, and it was pointed out many times, that the reductions were front-loaded in order to allow local authorities to adjust properly.
Grant Shapps
I want to make a little progress so I will push on and then take further interventions.
I have already mentioned that an authority such as Hackney receives more than £3,000 per household while those such as Windsor and Maidenhead receive nearer to £1,500. Last year we said that no council should expect a reduction in spending power of more than 8.8%, and I am pleased to say that we have been able to stick to that commitment for the second year running. I also mentioned the £20 million transitional grant, which means that the average reduction in spending power is 3.4%—just a little higher than the figure for the authority of the hon. Member for Warrington North (Helen Jones), which she failed to mention when she intervened.
This settlement delivers on promises already made. It has been recognised across the House and throughout the ages that the revenue grant system needs to change. The previous Government recognised that when in power. Indeed, there were many false dawns under the previous Administration. They set up local government Green Papers and White Papers to look into the issue, and the balance of funding review—remember that? They also set up the Lyons inquiry. What did they do with those reviews? Precisely nothing. They continued with exactly the same system that we are arguing about today, and which, for all sorts of reasons, is far too complex and difficult to interpret or make much sense of.
Mr Redwood
I am sure we all welcome the £1 billion extra for schools and education, but will the Minister explain why there will be a 35% increase in environmental special grants? That looks generous given the circumstances.
Grant Shapps
I thank my right hon. Friend. One thing that every Local Government Minister knows is that there will always be a reason, a cause, a plea or a demand for expenditure to go into one area rather than another—not just geographic areas but subject matters. He tempts me down a slightly different route, but that illustrates the extent to which the current formula is bust. It is broken, and it was recognised previously that it needed to change, but nothing happened to allow that.
Rather than talking, the coalition is delivering fundamental reform of the local government finance system through the Local Government Finance Bill, which includes our proposals to repatriate business rates—a reform that will create better incentives for councils to drive growth, promote local enterprise and deliver local jobs. Councils will be in the driving seat to expand their local economy. That reform is about not just redistributing the proceeds of growth but creating the conditions to boost growth overall. It is about not just cutting up the cake differently, which is essentially the argument that we are having today, but making a bigger cake in the first place.
Housing Reform
Debate between Grant Shapps and John Redwood(13 years, 7 months ago)
Commons ChamberRead Full debate Read Hansard Text
Mr John Redwood (Wokingham) (Con)
Will the Minister tell us what receipts he plans to get from all the sales that he has identified?
Grant Shapps
This is a large document and the receipts will come in many forms. The money that we are announcing for things such as the get Britain building fund will be recycled into building more homes, as will the money from the right-to-buy sales. I will write to my right hon. Friend with a more detailed note on precisely what we expect the receipts to be.