Local Government Finance

John Slinger Excerpts

Wednesday 5th February 2025 Commons Chamber

[Andy McDonald (Middlesbrough and Thornaby East) (Lab)]

It is an honour to speak in this debate. The hon. Member for North Cotswolds (Sir Geoffrey Clifton-Brown) spoke about auditors, and we are all aware that auditors are spread pretty thinly, which may, in part, contribute to delays in getting accounts signed off.

Local authorities are complex environments. In my area, we have two unitary authorities with populations of less than 100,000 people, so I commend the Government for looking very seriously at a more sensible local government structure. We are fortunate to have a Local Government Minister with such experience and expertise. It is a real boon, especially as we embark on such an ambitious and radical programme.

I welcome this year’s local government finance settlement. Councils have been subject to steep funding cuts since 2010-11, and these cuts have had a disproportionate impact on the most deprived areas. Many authorities face effective bankruptcy, putting essential services and jobs at risk. By 2025-26, councils in England will have received a 15.9% real-terms cut in their core spending power compared with 2010-11. Councils in the special interest group of municipal authorities, like Middlesbrough, have seen an average cut of 19.9%. Middlesbrough itself has seen cuts worth 22%, which is a real-terms cut of £55 million per year that amounts to around £835 per household, so this year’s settlement of more than £69 billion in overall national funding is welcome. It represents a cash-terms increase of almost 7% and a more than four times real increase on the past year.

The Government are on the right track in redirecting funding to areas that are in the most need and have the greatest demand for services. Those areas are often less able to raise income locally, as much as the Conservatives sought to pass the buck to local council tax increases. In areas like mine, many households pay over £3,000 per annum more in council tax than is paid by Buckingham Palace, so this settlement is fairer for councils and will provide welcome relief to the most deprived areas.

In Middlesbrough and Thornaby East, we very much welcome the settlement announced by the Government and the long overdue reforms to council funding. Middlesbrough council is now in a position to invest more money in key services. I welcome the fact that Mayor Chris Cooke, the Labour council and the new chief executive, Erik Scollay, have established the Middlesbrough priorities fund, worth over £4 million, and initiatives such Middlesbrough’s empty homes strategy, which will use £6 million of Government funding to purchase and refurbish empty homes for emergency accommodation.

While the settlement is under way, many authorities continue to face a shortfall, and the Minister has been very candid that this is not a done deal. We look forward to the three-year settlement later this year, because councils will not be able to rely on the additional funding being repeated. As colleagues from across the House have said, the three-year settlement gives councils the ability to plan much further ahead. I hope we can extend our commitments to wider investment in our services on a longer-term basis, through a fairer funding system that delivers long-term financial stability across all council services.

The position of our wonderful councillors has been raised. They do a terrific job, with very little reward, and they are sometimes on the receiving end of the ire of members of the public—sometimes justly, but sometimes unfairly and unkindly—so we need to address that.

[John Slinger (Rugby) (Lab)]

I am a serving councillor at Rugby borough council. I agree with my hon. Friend that councillors and council officers go out of their way to serve the public, which is extremely difficult when councils have faced 30% to 40% cumulative cuts. We need to remember that they are often trying to deliver services with one or both hands tied behind their backs, which is why the reforms set out by the Minister are so important.

[Andy McDonald]

I could not agree more with my hon. Friend. It is incumbent upon everyone in politics to recognise the work of our local councils and to treat them with the respect that they deserve. Some of the comments that I have heard in recent times run contrary to that. Councillors in my area have been put in harm’s way by careless and irresponsible comments made by people in this House who really ought to know better.

I will finish by talking about not only councillors, but the local government workforce and the issue of pay. The Minister will be aware that local government workers have missed out on the higher wage settlements paid out to workers in other parts of the public sector in the past year. Overall, they have seen 25% wiped from the value of their pay since 2010. In drawing the House’s attention to my entry in the Register of Members’ Financial Interests, I note that Unison, the GMB and Unite have said that a substantial pay award for local government staff is essential. Will the Minister therefore take steps to address those concerns and look to the upcoming spending review to deliver the finances and provide a long-overdue £15 minimum hourly rate for those workers who served us so incredibly well—I think of the covid days of maintaining those public services—so that they are properly compensated for their work?