Local Government Finance

Hazel Blears Excerpts

Wednesday 12th February 2014 Commons Chamber

[Brandon Lewis]

My hon. Friend makes a good point. The transformation of how we communicate, particularly through broadband, makes it possible to do many more things more efficiently and effectively, and it will no doubt continue to change how we deliver services and are able to work together across authorities.

The efficiency support grant has further incentivised transformation. The councils facing the largest spending reductions, many of which were in that position because they were abandoned by Labour’s reduction in the working neighbourhoods fund and left with a black hole in 2010, are now being given a leg-up towards making these savings through the transitional grant. I must declare my interest, as Great Yarmouth is one of the authorities that Labour left stranded. Authorities receiving the grant are protected by our safety net, which is bigger and stronger than last year. Despite some areas choosing to play politics with this—I am disappointed that Labour-run Great Yarmouth borough council refuses to follow the lead of other councils, sometimes even cross-party—councils such as Hastings and Pendle are doing some really good work on transforming things. Areas such as High Peak and Staffordshire Moorlands are working cross-party to share management and show the way to savings of about 18%. They are showing the way forward, and I hope that others will follow. Those in receipt of funding are making progress with their efficiencies, with many going a long way towards that, including many Labour-led areas. There is, however, more to do.

[Hazel Blears (Salford and Eccles) (Lab)]

I agree that transformation, integration and doing things differently is one way of mitigating the impact of the cuts. However, over the past few years my local authority in Salford has already cut our adult social care budget by £21 million. We were the last local authority in Greater Manchester to have to retreat to the position of providing support only to people with serious and critical needs. That means that 1,000 people in Salford will no longer receive support and care from the local authority. Those are real families in great distress, and the Minister must at least take account of that.

[Brandon Lewis]

I would be happy to meet the right hon. Lady and other Members from Salford if that would help. In a moment, I will touch on the better care fund, because we do need to look at how we change, reform and transform the delivery of adult social services, particularly social care. That is one of the things that my Department and the Department of Health are working on. I am working closely with the Minister of State, Department of Health, my hon. Friend the Member for North Norfolk (Norman Lamb), to deliver for local authorities.

We want to go further with the efficiency support grant. The Government do not want to continue as we have had to do, year after year, in patching up problems left from the Labour legacy. We have listened to authorities and to Members—not only me, before I was in post, but those such as my hon. Friends the Members for Hastings and Rye (Amber Rudd) and for Pendle (Andrew Stephenson)—about dealing with this issue once and for all and finding a permanent fix. Therefore, for councils that are on track with their efficiency plans and are delivering on the second year of their business plans, which we will review later this year, the grant will be rolled into their settlement in 2015-16. This a massive opportunity—a big reward—that will go a long way to filling, once and for all, the black hole in which seven authorities were left by Labour.

--- Later in debate ---

[Hazel Blears (Salford and Eccles) (Lab)]

It is rare indeed that I make a foray into local government territory—I do not think that it is entirely helpful for previous Ministers to reprise their experiences—but I have spoken today on the police settlement and will speak in this debate because I have been galvanised by the sight of what is happening in my community.

When I came to the House of Commons 17 years ago, it is safe to say that Salford was not the most attractive place to live. We had a huge range of problems, including crime, family breakdown, drugs and dreadful housing provision. We found it virtually impossible to attract business investment, and nobody wanted to live, work or raise a family there. Over the past 16 years we have seen a transformation in Salford and in Eccles. In many ways it is hard to believe that it is the same place. We now have MediaCityUK, the BBC, ITV and Salford Quays. Tourists and visitors now spend £200 million in Salford. Who would even have thought that tourists would be visiting Salford for a weekend break?

For a time, we had the fastest-falling youth unemployment rate in the whole of the north-west region. Our young people were getting skills, they had aspirations, and they were getting decent jobs. We have had a huge amount of regeneration. We are just about to put the final piece of the jigsaw in place with the Pendleton Together programme, for which I am grateful for Government support; we got £120 million through a private finance initiative. That will mean that virtually all of the city has seen some regeneration over the past 15 years. Yet what am I seeing now? In relation to crime, I am seeing antisocial behaviour starting to creep back into the system, despite the valiant efforts of our police service. I am seeing youth unemployment rising at an absolutely heartbreaking rate. I am beginning to see all the advantages we have gained starting to be rolled back.

I believe that this settlement is unfair. I entirely agree with my hon. Friend the Member for Sheffield South East (Mr Betts), the Chairman of the Select Committee, that we need to build a new system. The hon. Member for Bromley and Chislehurst (Robert Neill) said that we need a radical new system, and indeed we do, because the current system is badly hurting the most vulnerable people. Despite the success story of Salford, we remain a city with a huge number of vulnerable people, young and old. We have already put in place £97 million-worth of cuts over the past three years, and we have another £25 million-worth of cuts to make. Our spending power has been cut by 19.5%. On every single measure, our city is under strain, and many of our residents are now at breaking point. That is not just because of the local government settlement; it is the cumulative effect of the bedroom tax, which my hon. Friend the Member for Liverpool, Riverside (Mrs Ellman) mentioned, all the welfare reform provisions that have been introduced, and pressures on the health service.

Today we have had two debates. A Minister from the Home Office came to talk to us about policing, and now a Minister from the Department for Communities and Local Government has come to talk to us about local government. The cumulative effect of the cuts made by the Department for Work and Pensions in housing, transport, health and all the other areas is what matters to our constituents, because they do not see this in Government Department silo terms. In government, we said to local government, “You’ve got to get your act together. You’ve got to do Total Place, you’ve got to have community budgets, you’ve got to pool your budgets, your inspection regimes and your targets, because that’s the only way to survive this period of austerity.” That is absolutely right because it is the only way that we will be able to protect public services.

At central Government level, there is none of that joining up at all. A Cabinet Minister is judged on how big their budget is, how big their legislation is, or whether they are a big hitter; they are encouraged to operate as an individual. Yet we ought to be collaborating on all these issues. In the previous debate, I suggested that the Treasury ought to allocate interdependent budgets to two or three different Ministers so as to say, “Your success is dependent on your collaboration with your colleagues; we do not operate in silos.” On any company board, the sales director is dependent on the marketing director and the human resources director for the success of the enterprise. Our whole system of governing in this country is utterly old-fashioned and out of date.

This is nothing new. Five years ago, when I was in the Cabinet, I said to the Cabinet Secretary, “If you’re saying to local government, ‘You’ve got to join things up and look through a different lens’, then absolutely the same requirement is on central Government.” I am told that there is a bit of interest in this kind of reform at central Government level. I shall be pushing for that with every bit of my energy, because it is the only way that we, as a country, will be able to survive austerity. When my party comes back into government, which I hope will be very soon, we will face the same pressures. Being more creative, more innovative and more joined-up about the resources that we have to spend is the way we will make a difference.

I commend the report by the Local Government Association, “Rewiring public services”. It has done a brilliant job in trying to get some consensus across the political parties. It talks about more devolution, more co-location, a five-year funding settlement, fair sharing of resources across England, bringing all the Government Departments in England together, wider revenue-raising powers, and municipal bonds. That is the kind of innovation and creativity that we need. Just keeping on with this discredited route of salami-slicing our services will not protect the people who we all know are absolutely desperate. The sooner we get on with this programme of major reform, the better. I note the Minister’s invitation to me to come and make representations. I ask him, even at this late stage, please to consider the impact of this on some of the poorest people in my city, who are absolutely desperate at the moment.