Merseyside: Funding of Local Authorities

Kim Johnson Excerpts

Tuesday 8th February 2022 Westminster Hall

[Kim Johnson (Liverpool, Riverside) (Lab)]

It is a real pleasure to serve under your chairship, Mr Hollobone. I congratulate my hon. Friend the Member for Wirral West (Margaret Greenwood) on securing this important debate.

My hon. Friends, the superstars of Merseyside, have spoken eloquently of the funding crisis across Merseyside. The communities we represent have suffered systematic defunding for decades. This latest round of so-called levelling up is just the most recent in an endless stream of broken promises and increasing pressures on poor and working people.

In Liverpool, we have had two thirds of our budget cut over 12 years of Tory austerity. The damage that has done to the service we deliver cannot be understated. I pay tribute to councillors and officers in Liverpool who have worked hard with the ever-shrinking budget to ensure that our council continues to provide the best support possible to those in need in our city, including Granby Sure Start, Windsor Street library, Park Road sports centre and the invaluable citizens support scheme.

Liverpool is rated the third most deprived local authority in England. The deprivation faced by our communities is incredibly stark and increasing at an alarming rate. With in-work poverty at record levels and child poverty sky-rocketing, those we represent are facing a cost of living crisis. There is a triple whammy of soaring energy bills, real-term wage freezes and Tory tax hikes for those least able to bear them. Now, we are expected to fund an eye-watering 50% increase in the wages of the central Government commissioners, while making cuts of £34 million—all at a time when billionaires, bankers and shareholders are seeing their profits soar and their taxes cut. It beggars belief.

How can it be that Shell has declared a 14-fold increase in profits at the same time as it was announced that the energy price cap is being raised by 54%? The Government-driven rise in council tax in April will further compound these regional inequalities, as the wealthier councils in London and the south-east will be able to raise far more money than councils such as ours in Liverpool. Unless the Government commit significantly more funding to Merseyside and other underfunded areas, they will fail to address the systemic growth in inequality and poverty that is crippling our region.

The financial challenges faced by our communities are growing at an alarming rate. If we are truly to face up to them, cushion the most vulnerable against the worst of the impact and give our communities the long-overdue investment they need and deserve, we need to reverse the cuts of the last decade and provide multi-year settlements for councils in order to provide stability and phase out bid funding culture.

We have been here and seen it all before. Liverpool is no stranger to central Government policies of managed decline—we fought them in the ’70s under Thatcher, and we will fight them today under Boris Johnson. We cannot allow our communities to pay the price. Our local government institutions are already scraping the bottom of the barrel to balance the books. We must reverse the cuts to public services and local government; we need a £15 minimum wage to boost incomes to the lowest earners; and we must reverse cuts to social security and pension payments and reinstate the triple lock.