Local Government Finance (England)

Debate between Jim McMahon and Natascha Engel

Wednesday 10th February 2016 Commons Chamber

[Jim McMahon]

I thank my hon. Friend. We can talk about figures, and this is a debate about the settlement, so we are likely to do that, but we need to think about the human cost too. Down the line, what will these things mean for individuals, families and our communities? Oldham’s £200 million of cuts leaves a gross budget of £188 million. More than half the town’s money has been taken away by the Government.

If the answer to providing adult social care is a 2% levy on council tax, let us follow that through to see what it means. For Oldham Council, a 2% increase in council tax, as directed by Government, would generate £1.5 million, because of course the town has a low council tax base to begin with. However, the increase—just—in the living wage impacts on social care contracts, and so, not even taking into account an older population or increased demand, there is a £2.7 million increase in wage bills. With £1.5 million generated in council tax and £2.7 million in increased wage bills through the Government’s living wage, the numbers do not add up. This does not even allow us to stand still; we are going backwards.

I am sure that the hon. Member for St Austell and Newquay (Steve Double) is very pleased with a cash bonanza to buy his vote today, but some of us were not so fortunate. We had a raw settlement and a raw deal from this Government, because on top of the £200 million in cuts, we cannot ignore the rural relief grant. So it is cash after cash after cash for rural areas, not taking into account a single bit of need. It has already been pointed out that 85% of this funding is being given to Tory shires, but let me go closer to home and look at Greater Manchester.

Trafford has some rural areas, but let us look at them: Bowdon, Alderley Edge and Hale—“Footballers’ Wives” territory. This is the most affluent borough in Greater Manchester. It has the highest council tax, the highest business rate base, and the healthiest budget as a result of this Government’s policies—but that is not all. Because of the way that you have protected your side, you have something in common with Trafford—Baroness Williams of Trafford, the Local Government Minister and former Trafford Council leader, who lives in Trafford. Is a “friends and family” discount being offered? What do we need to do, Greg? Do you want to come and live in Oldham? If that helps our financial situation, then we will—

[Madam Deputy Speaker (Natascha Engel)]

Order. I know that the hon. Gentleman is new, but he speaks through the Chair, so when he is saying “you” he is addressing me. Members are referred to as hon. Members or named by their constituency.

[Jim McMahon]

I am very sorry for that slip, Madam Deputy Speaker.

The truth is that the five most deprived areas get absolutely zero—nothing—from this Government. At the same time, the five least deprived areas, together, share £5.3 million between them.