Somerset County Council: Unitary Status

Marcus Fysh Excerpts

Tuesday 22nd May 2018 Westminster Hall

[Mr Ian Liddell-Grainger (Bridgwater and West Somerset) (Con)]

I beg to move,

That this House has considered Somerset County Council’s plans for unitary status.

Thank you for calling me, Mr Hollobone. I am delighted to see my hon. Friend the Member for Yeovil (Mr Fysh) in his place, joining me today. This is an important subject to us, because it concerns the county of Somerset. A fortnight ago, the leader of the county council came to Westminster and threw an unexpected spanner in the works for all Somerset Members, who got no advance warning of the desperate plans to turn the whole county into a unitary. One by one, he spelled out his vision to us, and we were collectively gobsmacked—we had had no warning.

We knew that the county council was squeezed, and we understood the pressures of providing the most expensive public service with a small grant from Government. We also recognised that the writing had been on the same wall in Taunton for years. Funnily enough, it was back in 2006 that the idea of a Somerset unitary was originally conceived. I was there at that time; unfortunately my hon. Friend was not, but I believe that he was a county councillor.

[Mr Marcus Fysh (Yeovil) (Con)]

No.

[Mr Liddell-Grainger]

He says from a sedentary position that he was not, so that is me in the doghouse already.

The idea came from the dangerous mind of the chief executive, a tiny little man called Alan Jones—no surprises there. He was ruthless and he wanted a “lean, mean council”—his words. He went for the quick fix of getting rid of the district councils, and said the county could pocket—guess what?—£28 million. I will come back to that in a minute. Nobody ever knew quite how Jonesy arrived at £28 million, including me.

The present leader of the county council is still running with the idea 12 years later, and I am afraid that it is as wrong now as it was then. This is what rings alarm bells in my mind: Somerset County Council has never been good with money. I have looked at its books just to prove how bad it is. In 2007, it had only £11 million in the general reserve fund. Here we are, 11 years later, and it still has about £11 million—it is difficult to get a handle on it, but it is between £11 million and £18 million. That may sound like a lot in certain quarters, but it is chickenfeed when the overall budget runs into hundreds of millions. If an unexpected crisis happens—normally it does—there is nothing to fall back on, and unfortunately we have had that in Somerset. Occasionally, the place floods.

Alan Jones liked to pretend that everything was going well, but it was not then and it is not now. The county needed to borrow £376 million in 2007, so Napoleon Jones did a dodgy deal and signed his life away to IBM. He even persuaded his mates in Taunton Deane Borough Council to follow suit. Only two councils did so; the only other organisation to do so was the Avon and Somerset police force, known as the police farce. Together they created a thing called Southwest One, an overblown IT monster that it was boasted would save money faster than anyone could print it. The two councils apparently stood to gain £200 million in savings if everything went according to plan, but it never does—not in Taunton, anyway. Welcome to the south-west bubble: our proud county town—that is what it is—where backhanders are normal and nobody trusts the leaders. The two councils handed over a mass of public money to a multinational, and they wondered why it went belly-up.

If only little Jonesy had got away with creating a unitary, there would have been even more money for—guess who?—IBM. Many of us know of it. The plan was taken over by the districts, but it was doomed because the public did not buy it. When the county council refused to hold a referendum, we—me and the MPs at the time—organised it ourselves, along with the district councils who, regardless of political colour, all subscribed to it. Two hundred thousand people voted, and 84% of them said no.

By July 2007, the people had spoken and unitary Somerset was dead in the water. My hon. Friend the Minister might like to know this. He is the Member for Richmond—I helped on the by-election for his predecessor, Mr William Hague, only because I was in the Army and had a car—and North Yorkshire had also planned to become a unitary, but that plan was rejected by the Government at exactly the same time. There is historical precedent.

As for the Somerset IT monster, Southwest One had only two councils on its books, which made its own death inevitable. Then along came the international financial crisis, the credit crunch and the grim dawn of austerity, which we all remember with no great fondness. Austerity for everybody? Not in Taunton. Jones was sacked by the county in 2009, but it cost £300,000 to get rid of him. Down the road at Taunton Deane, the other IBM champion, Penny James and Shirlene Adam are still in the top jobs and, I am afraid, heading for another IT disaster. They say that donkey dung floats—we have incontinent donkeys galore in Taunton.

By 2012, Somerset Council’s borrowing was on course to hit £410 million, which means shelling out £100,000 every single day just to keep the loans going. All the while, the price of providing vital children’s services and social care was going up, and I say gently to my hon. Friend the Minister that Government grants were coming down.

There is plenty of evidence that the council cannot control what it spends and tackles big problems by taking even more ridiculous risks. The learning and disability service was outsourced, for example, which made financial sense only if the savings added up, but, just like with Southwest One, the real cost outweighed the benefit. Learning and disability burst its budget and then faced extra cuts.

There are ongoing problems in several parts of the council. A recent peer review found that only 65% of promised savings actually took place, so I am afraid the reserves are running out. They were dwindling three years ago when a budget freeze was imposed, but things have got worse. By September 2016, the cabinet talked about declaring the authority bankrupt. It did not happen then, but it is dangerously close to happening now.

I am indebted to the work of Kevin Nacey, whom my hon. Friend the Member for Yeovil knows well. He has been the head of finance at Somerset County Council for donkey’s years. He has done the accounts since 2006, but he has had enough: as the latest county calamity began, he announced an early exit. Mr Nacey is off to pastures new, and—dare I say it?—a big juicy carrot: he will soon be in charge of the books of the donkey sanctuary. Eeyore would say of all this, “How very appropriate.”

I have several direct questions for the Minister. We have to work through this; we cannot go on like this in local government. Last week, he and I had another debate on the future of Taunton and West Somerset, which—dare I say?—the Government managed to get through. I feel I was unfair in what I said at the time, but I gently say that I strongly believe that the Government are not playing fair with local government. Last week I was a little more profound, but I was more cross; this week I am more measured.

Local government does matter. The Minister’s constituency covers a vast geographical area—he has a seat bigger than mine, and I always think that Bridgwater and West Somerset is pretty large—and the problem for all of us is that the democratic deficit cannot be taken away without leaving a problem. Where unitary status has happened in very big counties, it has created enormous stresses, not least on the MPs in those areas. When councillors have to look after more and more, and deal with more and more, that deficit gets big. I ask him to pass this point on to my right hon. Friend the Secretary of State: please think about the future of local government. I do not wish to spend whatever time I have in this place getting up every time I can to say to Ministers, “Could you please defend local government?”

Reorganisations are never good. In 1974 the Government of the day created Avon, which my hon. Friend the Member for Yeovil is aware of. They created North Somerset and Bath and North East Somerset, which is now a unitary and is struggling because it is too small for a unitary. Maybe we as a county need to talk to Devon and to North Somerset.

[Mr Fysh]

My hon. Friend is making an interesting speech about the history of local government in Somerset. Does he not think, though, that to deal with the overhang of debt that the Liberal Democrats left the county with in 2009, it has been necessary to take a raft of difficult decisions? Is it not worth at least exploring ways of saving the taxpayers money? This proposal might be a solution, but like him, I would say it is imperative that we ensure no democratic deficit is created through the process.

[Mr Liddell-Grainger]

My hon. Friend is absolutely right. He was a county councillor, and so was fully aware of the situation—more so than any of us. I am delighted to see that my hon. Friend the Member for Wells (James Heappey), who I know had a pressing engagement, has made it here. He will recognise this point, because he wrote a devastatingly good article that follows on from what my hon. Friend the Member for Yeovil has said. My hon. Friend puts forward a good case that we must look at the debt, look at our options and look at our future. I will take that first point first, if I may.

My hon. Friend is right that it was the Liberals who created the debt—not the Conservatives, but the Liberals. We are now living with that legacy, but it has to be faced. I say to my hon. Friend the Minister that it is our social services that are pulling us down. The problem we face is that we do not have enough money to take care of the neediest in our community.

The second point my hon. Friend the Member for Yeovil makes, which I have made before and which I know my hon. Friend the Member for Wells agrees with, is that we should also look to our neighbours. My hon. Friend the Member for Wells wrote a good piece about looking toward BANES, and I mentioned looking toward Devon. We have no parameters—we could look at either of them—but we need democratic accountability. I say to my hon. Friend the Minister that if we are going to go through with any form of unitary, we need to have a referendum. If we need to look to the people of BANES to split up the ghastly edifice that is Avon and get our old county back, we will do that.

When Councillor Fothergill came to the House—he was very courteous; it was a very courteous meeting—I asked him directly about a referendum. He said, “I will hold negotiations or conversations with our stakeholders.” To me and to my hon. Friends the Members for Yeovil and for Wells, the stakeholders are our constituents. They are our stakeholders, not the Avon and Somerset police farce, based in Bristol, or the ambulance service, now based in Exeter, I believe, or the fire service, based wherever the heck it has got to now. We, the people of Somerset, are the stakeholders. That is who we represent.

I would like the Minister, if possible, to say a referendum should be held. We did not hold one in West Somerset. When I had to put my views gently to the Minister last week, I said that the majority of people who took part in what can only be described as a pretty desultory consultation were against that proposal, but they were ignored. I hope that will not be the format for the future.

I say to the Minister, please do not underestimate the ability of Somerset to fight back. We have done it once, and we will do it again. The last time was the battle of Sedgemoor in 1685, which happened in my constituency, very close to the constituency of my hon. Friend the Member for Wells. We marched on London. This time we are coming by train, so we will not get it wrong, and I assure the Minister that we will do what we have to in order to overturn this decision. I therefore urge him to think constructively about a great county such as Somerset. We have had our traumas, but we have a team that is blue throughout, and we want to keep that.