Council Tax Reform
Luke Myer Excerpts(1 week, 2 days ago)
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Luke Myer (Middlesbrough South and East Cleveland) (Lab)
I congratulate my hon. Friend the Member for Hartlepool (Mr Brash) on securing the debate. He is absolutely right that the system is outdated, regressive and in desperate need of change, and our region is disproportionately impacted.
My constituency is split between two local authorities: Middlesbrough to the west, and Redcar and Cleveland to the east. They are two distinct areas with their own local challenges, but they face similar issues when it comes to council tax. Loftus in Redcar and Cleveland will have a band D council tax rate of more than £2,500 for the next financial year. That means a multimillion-pound property in East Sussex can attract a lower council tax bill than the average family home in our region. That cannot be fair. In fact, owner-occupiers in our region can expect to pay a percentage of their property value that is 2.5 times higher than the average London resident. That is another example of an unfair system based on three decade-old valuations, hammering local residents in areas of high deprivation.
Over 50% of dwellings in Middlesbrough are designated as band A—a much higher percentage than other local authorities—forcing Middlesbrough council to have the 19th highest council tax rate in the country. One way in which that could be helped is if Valuation Office Agency powers were devolved further to local authorities to allow them to more rigorously assess whether a property is incorrectly banded. That measure would just be tinkering around the edges of a system that needs fundamental reform.
As my hon. Friend said, one solution would be to replace the current system with a proportional property tax, removing the antiquated 1991 bandings and instead asking residents to pay a percentage of their up-to-date property value every year. That would create a more progressive system, preventing those in lower-value homes from paying disproportionately higher rates, while ensuring that wealthier property owners elsewhere in the country contribute a fairer share.
As the Institute for Public Policy Research has set out, another method to address the issue would be further increasing council tax premiums on empty and second homes. As my hon. Friend has noted, reforming the children’s social care market, which has been described as “broken” by the Competition and Markets Authority, would go some way to repairing local government finances and delivering value for taxpayers.
The choice is clear: either we keep patching up a system that punishes regions like ours, or we build one that is fair, proportional and fit for the 21st century. Teesside cannot afford to wait another 30 years.
Local Government Finance
Luke Myer Excerpts(1 month, 3 weeks ago)
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Jim McMahon
Absolutely. Deprivation is a key part of the funding settlement. This is the first settlement in a long time, and probably the first since the area-based grant in 2010-11, in which deprivation is a measure by which the Government allocate money to the sector.
If we see this as only a local government problem, we will miss the prevention and reform agenda that we need. My hon. Friend and I often talk about this, but the Home Office is working on diversionary activities for young people. In many communities, gang activity, child criminal exploitation and knife crime are very real issues that draw too many young people into crime. We need those diversionary activities in the places where people live.
We need to address that, and it should be a whole of Government agenda. That is why we are marshalling our work around the Government’s missions, and our approach is anchored to the plan for change.
Luke Myer (Middlesbrough South and East Cleveland) (Lab)
I welcome the focus on deprivation. The Minister says he does not want to criticise the leadership of particular councils, but will he praise the leadership of Middlesbrough council? Mayor Chris Cooke has led the council out of a best value notice and produced the first growth budget in years, with increases in area care and much else. Will the Minister commend that work?
Jim McMahon
That work is demonstrated by the Department being able to remove the best value notice. We know that Middlesbrough is not at the end of the improvement journey, and the council itself would say that, but the characteristics of strong civic leadership are clearly on display. I appreciate that it is a lot easier to praise a council from the Dispatch Box.
When we consider funding for councils to deliver vital services, we must also consider the taxpayer. We are committed to keeping taxes on working people as low as possible. At the same time, we understand the immense pressure that councils are under, which is why we will strike a balance in maintaining the previous Government’s policy of a 5% referendum principle threshold, which includes a 3% core principle and a 2% principle for the adult social care precept. We all know that councillors, mayors, police and crime commissioners and councils will take into account the impact of increases on households, and it is right that they do so. For the vast majority of councils, those principles and the additional £5 billion in funding that we have announced will be sufficient to support them in setting their budgets. However, we know that some councils are in difficult positions, as we have heard today. For some, unique local decisions have had an impact on their financial stability. For others, over a decade of mounting pressures has finally caught up with them, and whatever they do, that is the reality. We are determined to work together to find a way through that, including by considering requests for additional council tax flexibility and requests from councils seeking exceptional financial support.
English Devolution
Luke Myer Excerpts(3 months, 1 week ago)
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Jim McMahon
The truth is that these strategic authorities are about taking power from this place and moving it down to communities. Every Minister gets hundreds of sign-offs every single day, but as Conservative Members will remember, they include Ministers having to sign off whether cyclists can pass through a local park because the parish council has to apply to central Government for permission. That is part of the centralising nature of the state that we have to change.
Luke Myer (Middlesbrough South and East Cleveland) (Lab)
I welcome the statement and the White Paper. Centralisation is part of the reason why we are one of the most regionally unequal advanced economies, as IPPR North has set out, but it is important that these strategic authorities are run well. What steps will the Minister take to ensure that they are funded fairly, and what assurances can he give that strategic authorities must demonstrate responsible stewardship of the public finances?
Jim McMahon
That is why there is a proposal in the paper to regularise the mayoral precept process. Where combined authorities exist and do not apply a precept, it is not that mayors and combined authorities do not cost money—of course they do—but that local authorities pay for them through a levy or a contribution outside the precept system. Our view is that, for transparency, accountability and political accountability, when mayors and combined authorities or strategic authorities are spending money, the public have a right to see that identified in their council tax, and they can make a judgment about whether that money is being spent wisely.
Planning Committees: Reform
Luke Myer Excerpts(3 months, 2 weeks ago)
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Matthew Pennycook
I can reassure the hon. Lady on that point. The proposals will operate within the context of a national planning policy framework that has very clear requirements in relation to flooding. We are in no way removing local expertise and knowledge from the system; either experienced and trained local planning officers or locally elected authority members should make the decisions, but we have to ensure that they are making the right ones, and that their energy is focused in the right way, to streamline the decisions that we need. We heard the statistics on how planning applications are not progressing through the system at a timely pace. We need to turn things around.
Luke Myer (Middlesbrough South and East Cleveland) (Lab)
I associate myself with the comments of my constituency neighbour, my hon. Friend the Member for Middlesbrough and Thornaby East (Andy McDonald), on ensuring that the planning authority for Middlesbrough sits within Middlesbrough. Young families in Teesside are desperate to get on the housing ladder, yet last year the number of new homes given planning permission fell to a 10-year low. Can the Minister reassure the House of the steps that he will take to ensure that homes are built and that we get Britain building again?
Matthew Pennycook
My hon. Friend is absolutely right: permissions have fallen sharply, in part because of changes that the previous Government made to the national planning policy framework, which gave local authorities myriad excuses to bring forward plans that were below their nominal target, although it remained in place. We have got to oversupply permissions into the system, which is precisely why the proposed changes in our consultation on the NPPF would make 370,000 the standard method total envelope. That is how we will build 1.5 million homes over the next five years.