Lancashire County Council

Debate between Julie Cooper and David Morris

Wednesday 22nd February 2017 Westminster Hall

[David Morris (Morecambe and Lunesdale) (Con)]

I beg to move,

That this House has considered local government funding and Lancashire County Council.

It is a pleasure to serve under your chairmanship, Mr Owen. I have called for this debate because I am concerned that Lancashire County Council has trouble in managing its budget. It talks about Government cuts as an excuse for any problem, and I do not have confidence that it understands how to manage a budget in its entirety. Its deputy leader, David Borrow, recently presented a no-change budget. He went on to say that the budget was

“in the face of massive savings needed because of massive Whitehall grant cuts imposed by this Tory Government”,

which was quite perplexing.

On the back of that statement, I looked up the answer to a question I had asked, which said that on 31 March 2016 the council had £716 million in reserves. Out of that £716 million, £314 million was not ring-fenced, while £402 million was. Figures are bandied about all over the place in the county council, the press and wherever. I am not bothered about that. What I am bothered about is trying to get to the bottom of what is allocated by central Government to the county council in its various forms.

The leader of Lancashire County Council, Jennifer Mein, said:

“These cuts in the Government grant are shocking…They are unprecedented.”

She also said:

“The county council faces the greatest financial challenge in its history, a challenge so great that within a couple of years we will not have the money to deliver the statutory services we must deliver by law.”

All of that focuses on only one area of Government funding, I might add, which is the revenue support grant. That grant is only part of what central Government gives to the county council. In 2016-17, Lancashire County Council received £118.8 million in revenue support grant—that was 7.1% of its actual spend. In 2017-18 it is due to receive £81.5 million, which on last year’s budget, without any savings, would be 4.8% of actual spend.

The revenue support grant is a small amount of the county council’s overall budget. Although it was acknowledged by all political parties after the financial downturn that savings needed to be made, that is not the reason for all the problems the council seems to have in balancing its books. Lancashire County Council’s political leadership seems to focus on the revenue support grant as if it were the only factor in the budget. In fact, in 2015-16 it received £1.1 billion in different Government grants, and only 14% of that was revenue support grant.

As I said, I called the debate to get to the bottom of how much funding Lancashire County Council is getting from central Government. I asked the House of Commons Library to compile a list of the different streams of funding given to Lancashire County Council. They are settlement funding grant; the new homes bonus; adult social care grant; transition grant; rural services delivery grant; the improved better care fund; learning disability and health reform funding; Care Act funding; local welfare provision; the early intervention fund; and lead local flood authorities funding. There are also ring-fenced grants such as the public health grant; the dedicated schools grant; housing benefit administration subsidy; and the former independent living fund grant. Figures show that for that last grant, Lancashire County Council received the largest grant of any council in the country in 2015-16—£4.8 million in nine months. In 2016-17 it is getting £6.07 million, in 2017-18 it will be £5.9 million, in 2018-19 it is projected to be £6.7 million and in 2019-20 it will be £5.5 million, which will still be the largest amount of any county council nationwide. The list continues: the council receives council tax support administration subsidy, as well as money from the highways maintenance fund and the potholes action fund, with funding to fill 23,415 potholes in this financial year and further funding to fill 32,415 potholes next financial year.

As Member of Parliament for Morecambe and Lunesdale, my main concern has been that the political leadership of the county council is failing my constituents. It seems that the leadership seek to hold back my constituency. They blame Government cuts, but they have consistently held back my plans for an enterprise zone—I know those zones may be phased out, but I am sure they will be replaced with some other kind of funding stream—and ensured, with their seats on the local enterprise partnership, that funding for my constituency was not applied for. I firmly believe that.

In response to that charge, Jennifer Mein said:

“I’m proud of our track record of promoting jobs and growth right across the county and particularly in the Lancaster & Morecambe area. I can think of several initiatives that the county council, the Lancashire Enterprise Zone and Lancaster City Council have worked jointly on: The delivery of the long-awaited Bay gateway which has opened huge opportunities for employment and business growth across the county.”

Incidentally, neither she nor the current Labour administration had anything to do with the bay gateway; I secured the funding and it was a Tory-led county council that enacted it.

Mrs Mein went on to wax lyrical about funding from the Government, which features no cuts at all and in most cases is awarded to stakeholders outside of the county council’s direct influence:

“Working with the University and the Enterprise Partnership, as well as the City Council, we have: assisted in bringing forward the Health Innovation Campus with an investment worth over £17m; Secured Garden Village status for South Lancaster—”

which is effectively a new town—

“(one of only 14 such designations in the country) with extra funding for infrastructure work at Junction 33—”

on the back of the new town—

“Seen investment of £2.5m in the Lancaster Teaching Hub of Cumbria University aimed at training new nurses and care workers; Facilitated £4m of commercial lending in support of the Luneside East development. Our Business Growth Hub, ‘Boost’, has worked with over 140 growing SME businesses in Lancaster over the past two years. This work looks to continue and grow following the County Council’s further investment of £3m to support the work of ‘Boost’.”

I am sure that is very welcome in those vicinities, but in response to my charge, she failed to list one project that the current administration has directly funded in Morecambe and Lunesdale. The link road was given the green light before the local enterprise partnership—and that administration—came along, so I fail to see exactly what she claims has been done in my constituency.

[Julie Cooper (Burnley) (Lab)]

On the hon. Gentleman’s comments about the failure of political leadership in Lancashire County Council, is he aware that the leader of the council, together with the deputy leader of the Conservative group and the leader of the Liberal Democrat group, all recently attended Parliament to meet Labour MPs? All were of one voice in speaking of the inadequate funding provided by the Government.

[David Morris]

I know that the leader of the county council also went to see the special advisers in the Department for Communities and Local Government. They told her categorically, if she needs more money or thinks the council will go bankrupt, to go and see the Secretary of State.

The politicisation of the LEP seems to be a huge problem in Lancashire. It is extremely rare to have county council officers also officiating over the LEP. The LEP’s agenda seems to be the same as the county council’s, meaning that the growth deal funding is used in Preston and is Preston-centric. Lancashire County Council also prioritises Blackpool, presumably because of the combined authority proposals. The LEP currently presides over £1 billion of funding, of which not one penny has been scheduled to be spent in Morecambe and Lunesdale.

The county council commissioned a £7 million-plus report from PricewaterhouseCoopers, which stated that, if the council does nothing, it will go bankrupt and the Government will need to take over statutory services—that is what I was alluding to in my answer to the hon. Lady’s question. That money was wasted on a report that told the council that it needs to take action to manage its budget, with PwC also asking what services could have been protected for that money. The report into statutory services cost £1 million alone, and the social care report cost £6.6 million. That money was spent to find out how to save £36 million, but the report’s proposals are the same as what is happening in the “Better Care Together” strategy that is already being piloted in Lancashire.

Will the Minister tell me the full breakdown of each grant given to Lancashire County Council by central Government over the past four years? Will he assure me that the Department will investigate Lancashire County Council, to ensure that money is being spent appropriately and not on vanity projects while services are being cut? Will he also reassure me that political neutrality is being adhered to on the LEP, and that the political leadership of the county council does not have undue influence over the running of the LEP by county council officers who are effectively dual-jobbing?

Finally, I would love the Minister to assure me that any changes announced within the last hour by the Secretary of State for Communities and Local Government, either to devolve further spending and revenue responsibilities or to form a combined authority, are heavily scrutinised and are given the green light only once Lancashire County Council can prove that it can manage its budget.