Social Fund

Lord McKenzie of Luton Excerpts

Tuesday 28th January 2014 Lords Chamber

[Baroness Stowell of Beeston]

As the noble Lord knows, the process of deciding the amount of funding that is made available through the local government finance settlement is very much considered on the basis of a range of issues, including pressures and demands that may be greater in some parts of the country than others. That is why we provide a higher rate of funding in some areas as opposed to others, as we do in Newcastle. Certainly, what we are also expecting all local authorities to do is to carry out measures that allow them to realise their own savings so that they can continue to provide the services that are needed by local people.

[Lord McKenzie of Luton (Lab)]

My Lords, the Minister confirmed earlier that the funding stream is to be subsumed into the general funding stream for local authorities. May I remind the Minister that the stream is going to be cut by some 13% in 2015-16, following the 9% cut in the year that we are just about to enter? We know that the basis for the distribution of the funding will continue to cut spending power for the most deprived councils, while increasing spending power for the wealthiest councils. I ask the Minister: how is that fair to the vulnerable?

[Baroness Stowell of Beeston]

As the noble Lord knows from the debates that we have had on the local government finance settlement, we look at the total spending power available to local authorities in terms of their spending revenue, and in 2015-16 the reduction of their spending power will be 1.8%. I also make the point to the noble Lord that in the course of our discussions with local authorities in looking at streams of funding, we have clearly understood where they are facing big pressures. That has led us, for example, to ensure that there is significant new funding for social care.