Hospitality Industry: Government Support

Mark Pawsey Excerpts

Monday 11th January 2021 Westminster Hall

[Mark Pawsey (Rugby) (Con)]

It is a pleasure to take part in this important debate after receiving 50 representations to do so from constituents, including from pubs—The Red Lion in Hillmorton, and The Griffin in Kingsway. I want to talk about the impact on supply, as one or two Members have already done. I spent 30 years as a supplier to the catering trade. In that regard, I draw the House’s attention to my entry in the Register of Members’ Financial Interests.

We often appreciate things when they are not there, and we are missing our pubs, cafés and restaurants right now. When they are not operating, it has a significant effect on the suppliers to the sector. Although I welcome the support that the Chancellor has spoken about—he referred to £4.5 billion today—many of the suppliers are not receiving the same level of support as the trading companies. During the pandemic, we have seen food purchases transferred from out-of-home to in-home consumption, and the beneficiaries have been supermarkets, which have done well out of the restrictions. Most have reported higher sales. For example, Tesco sales were up 11% over the Christmas period.

It is often assumed by many that suppliers and food manufacturers are able to switch production and pivot to supplying retail, but catering and retail products are very different, and as a consequence those businesses are losing out. We have heard about the switching on and off of hospitality, which has led to a great deal of stock being wasted. The food supplier, Creed Foodservice, spoke at the weekend about £6,000 of milk going out of date because of the decision to close schools. It says that it has written off £150,000-worth of food since April.

The business I ran supplied tableware items—things such as paper napkins, table covers and Christmas crackers. I have to say that an awful lot of the crackers that were bought for Christmas in 2020 were not pulled. Now, they can be held in stock and used for another year, but of course that involves tying up capital and taking up warehouse space, which are costs to those businesses.

Food service businesses continue to pay bills such as rent, electricity for chillers and loan payments for vehicles that are often standing idle. Wholesale distributors are usually high-volume, low-margin businesses, and the fixed costs mean that a relatively small fall in sales has a disproportionate impact on profitability. Too long a period without profit will cause many suppliers to fail.

In addition, the catering trade—restaurants and pubs—often use the cash sales generated in the current period to pay for goods received in the previous period when they were trading. That has led to many suppliers becoming banks and funding their customers. There is very little action that those suppliers can take if the hospitality businesses do not have the cash to pay them. I hope that the Minister in his response will show his appreciation for the supply chain, as well as for valued hospitality businesses.

Arcadia and Debenhams: Business Support and Job Retention

Mark Pawsey Excerpts

Wednesday 2nd December 2020 Commons Chamber

[Paul Scully]

This is an important situation. Our hearts must all go out, as they have done today, to the employees of both Arcadia and Debenhams. In terms of an online sales tax, that is something we will look at in the fundamental business rates review. It is important that our high streets survive. There is an understanding that online businesses have an important role to play, but they must pay their fair share of taxes.

[Mark Pawsey (Rugby) (Con)]

The challenges that Arcadia and Debenhams face existed before covid, but they have been accelerated by it as people move online. The Minister outlined the very substantial support the Government are providing to retailers, but, to follow the question from the hon. Member for Aberdeen South (Stephen Flynn), should the Government go further and consider levelling the playing field between bricks and mortar and online retailers through an online sales tax?

[Paul Scully]

An online sales tax is one consideration that the Treasury will look at, but it is more than that. We need to ensure, in the fundamental business rates review, that there is a connection between businesses, bricks and mortar retailers, and their place, rather than just the customers themselves. There is an important body of work to be done and I know the Treasury will have heard the comments and views today.

Covid-19 Lockdown: Homelessness and Rough Sleepers

Mark Pawsey Excerpts

Wednesday 11th November 2020 Commons Chamber

[Mr Speaker]

Order. We have a lot of people who need to get in, and we have spent 15 minutes on the first three questions. We need to pick it up.

[Mark Pawsey (Rugby) (Con)]

I welcome the measures and the very significant funding that the Minister has announced today. Does she agree that it is important to take the same kind of approach as that taken by Rugby Borough Council through its preventing homelessness and improving lives programme? That has made a tremendous difference to local families at risk of homelessness through early intervention by a dedicated support team, working with those who are vulnerable to prepare a plan to avoid a crisis situation later.

[Kelly Tolhurst]

My hon. Friend is absolutely right: it is by the good practice of councils such as Rugby Borough Council and programmes of that nature that they are able to work with those families and individuals before there is a need for them to sleep rough or become homeless—it is prevention. We know that since we implemented the Homelessness Reduction Act, that has had a significant impact in many parts of the country. I am pleased that we are determined and committed to make sure we implement that even further and work with local authorities to get better results.

Oral Answers to Questions

Mark Pawsey Excerpts

Monday 15th June 2020 Commons Chamber

[Luke Hall]

I thank the hon. Gentleman for the way that he asked his question. We have seen a remarkable effort from local authorities, volunteers, the homelessness sector and councils of all party political persuasions, who have worked together to bring so many rough sleepers and people in danger of sleeping rough off the streets to give them the support they need. We are of course working with local authorities across the spectrum to put plans in place to support people into longer-term accommodation. Alongside that, we have announced £433 million to deliver 6,000 units of new move-on accommodation and personalised, wraparound support. I am always very happy to meet the hon. Gentleman to discuss this further.

[Mark Pawsey (Rugby) (Con)]

What steps he is taking to ensure the safe reopening of high streets and town centres as covid-19 restrictions are eased.

[Antony Higginbotham (Burnley) (Con)]

What progress he is making on plans for the safe reopening of high streets and town centres as covid-19 restrictions are eased.

[Mark Pawsey]

Rugby town centre has reopened today with the unique innovation of images of a rugby ball placed on the ground to remind people of the need for social distancing. As a former salesman, I know that “You can’t sell if you don’t tell”, so does the Secretary of State agree that in addition to the practical safety measures that he has spoken about, councils must reassure people that town centres are open for business by accompanying them with an effective local marketing campaign?

[Robert Jenrick]

Our £50 million reopening high streets safely fund, of which Rugby is one beneficiary, allows local authorities to create communications plans to give people the confidence to get back on to our high streets, to support local businesses and to help the economy move forwards.

Planning Process: Probity

Mark Pawsey Excerpts

Thursday 11th June 2020 Commons Chamber

[Christopher Pincher]

I certainly agree that transparency in planning is important. That is why the decisions that Ministers make, if they are involved in those planning decisions, are properly published and open to full public scrutiny, as they have been in the case that the hon. Member for Croydon North (Steve Reed) has raised.

[Mark Pawsey (Rugby) (Con)]

Like the hon. Member for Vauxhall (Florence Eshalomi), I sat on my local planning committee and in my training I learned that only the most contentious of applications, or those of national significance, come before the Minister. We have an example on our doorstep, just over the road, where the 50-storey St George’s Tower was granted by John Prescott against the wishes of the local council. Can the Minister clarify why certain applications require a ministerial decision?

[Christopher Pincher]

There are some applications which, because of the number of homes, will involve a ministerial decision. Other applications, which are timed out because the local authority has not been able to come to a determination and the applicant appeals, also come before a Minister. That happens in a small number of cases. It happened in the Westferry case, but I remind the House, because I think it bears repetition, that the issue came before the Secretary of State because the local authority failed to make a determination. It came before the previous Secretary of State in the early part of last year and went through the normal adjudication process in MHCLG.

Planning System: Gypsies and Travellers

Mark Pawsey Excerpts

Wednesday 29th January 2020 Westminster Hall

[Mr Hollobone]

Yes, I would like that to be the case. It seems to me that if someone is intentionally seeking to build an unauthorised development and is subject to a temporary or a permanent stop notice, they should do what that notice says—stop the work and restore the land to its original state. To my constituents, that would seem a sensible way forward.

[Mark Pawsey (Rugby) (Con)]

My hon. Friend is talking about the huge increase in retrospective planning applications. The Times ran an article quite recently showing that there were 39,200 retrospective applications over three years, and only one in eight of those was rejected. If somebody develops land without consent, there is a good chance that they will ultimately get consent. There is a huge incentive for Gypsy and Traveller encampments, because in most circumstances the land is acquired at agricultural value and once consent is achieved, it has a worth as developable land. There is a big incentive for people to try to abuse the system in that way.

[Mr Hollobone]

I totally agree with my hon. Friend. Local planning authorities should have the ability to enforce a requirement that people occupying sites without permission should not be permitted to remain on site while it is going through the planning process. That would stop the problem.

Where intentional unauthorised occupation has occurred, the requirement on the local planning authority in the decision-taking process to consider

“the availability (or lack) of alternative accommodation for the applicants”

should be removed. If a member of the settled community built a dwelling on land in the open countryside without first obtaining planning permission, the local planning authority would not, as part of the retrospective decision-taking process, consider the availability of alternative sites or be obliged to have to hand alternative sites to which the applicant could relocate. All I am asking for is equal treatment for everyone under the planning system, not preferential treatment for Gypsies and Travellers.

Often when Gypsies and Travellers find themselves in that situation, they say, “We’ve got nowhere else to go.” One of the problems for local planning authorities is that it is very difficult for them to check, when they are told that by Traveller families, whether those families own land elsewhere. We need a sensible arrangement with the Land Registry to help local authorities accurately check and verify an applicant’s other land holdings. That is difficult for local planning authorities to do, and it is something I believe the Minister can tackle.

I know that the Minister is here representing the Ministry of Housing, Communities and Local Government, and the Home Office will probably have the lead on the trespass issue—I would welcome his confirmation on that. When changing the rules on trespass, can we lower the number of vehicles needed to be involved in an illegal camp before the police can act? At the moment, I think it is six; it needs to be at least two, and I would go lower.

The police need to be given powers to direct Travellers to sites in neighbouring local authorities, not necessarily just in the local authority where the trespass takes place. Officers should be allowed to remove trespassers from camping on or beside a road, not necessarily just on land, and the time in which Travellers are not allowed to return to a site from which they have been removed should be increased from three months to at least a year, and I would go further than that.

There are lots of distinguished Members seeking to contribute to this debate. I thank you, Sir George, for your indulgence. On behalf of my constituents in the borough of Kettering, I press the Minister and the Government to seize the initiative on this issue and get something done.

--- Later in debate ---

[Mark Pawsey (Rugby) (Con)]

I will be mindful of your remark, Sir George. It is a pleasure to serve under your chairmanship.

I congratulate my hon. Friend the Member for Kettering (Mr Hollobone) on bringing this important issue before us, and on standing up for the concerns of his constituents, as he has done for many years. He drew attention to the failures of the planning system, which also affect constituents in the north-western part of my constituency, around the larger village of Bulkington in Nuneaton and Bedworth and the nearby villages of Ansty, Shilton and Barnacle, which fall under Rugby Borough Council. The fact that some of the issues occur on a local authority boundary adds to the complexity.

Understanding why the Gypsy and Traveller community find that part of the country a good place to be located is important. It is a little to do with how the Traveller community earn their living. Many of them have businesses that revolve around construction and property maintenance, and the big urban area where many of their customers are is Coventry, which is immediately adjacent to those villages. What adds to the complexity in the choice of location is the fact that it is in the urban edge around Coventry, where there is green belt and therefore a presumption against development. The fact that the Gypsy and Traveller community have been able to secure consents, or have developed without consent, has over time contributed to a feeling in the settled community that in some instances an advantage is being provided to that community.

All the sites in my constituency are in the green belt. The pattern of their development was described by my hon. Friend the Member for Kettering. A development often takes place on a paddock, on agricultural land, frequently starting on the Friday of a bank holiday weekend, which means a delay before local planning authorities can get to the site to start enforcement action, by which time some pretty substantial works have taken place. The procedure then is that the local enforcement officer goes out and invites the applicant to submit a retrospective application—we have spoken about this issue, and I am very supportive of my hon. Friend’s comments on looking at how this ought to be changed.

Eventually, that application reaches the local planning committee, which turns it down because the development is considered to be inappropriate in the green belt. More time passes and the applicant decides to lodge an appeal. The appeal is dealt with by the Planning Inspectorate, whose decision overrides that of the elected members of the planning committee. Often, a planning inspector will grant a consent, perhaps highlighting the issue that has been covered in this debate, which is the lack of authorised pitches and concerns about where else applicant families would go. On occasion, those consents are granted as temporary consents.

I will deal a little more with the issue of retrospective applications, and with the issue of temporary consents within the planning system. I expressed concern about the nature of retrospective applications to my local planning officers, who told me that the issue is often the failure to understand on the part of the Gypsy and Traveller community.

My hon. Friend the Member for South West Bedfordshire (Andrew Selous) spoke about the literacy challenges in that community, but they seem on occasion to be able to afford to engage the best planning lawyers, often as a consequence of the substantial increase in value that occurs.

The issue of temporary consents affects Top Road in Barnacle, which has a complex planning history. With each subsequent application, the temporary consent gets closer to being permanent, which is a matter of great concern for residents in Bulkington.

--- Later in debate ---

[Luke Hall]

I thank the hon. Gentleman for raising that point and sharing his local authority’s experience. I am happy to touch on that shortly, but let me turn first to the green belt, which was raised by a number of Members, including my hon. Friends the Members for Mole Valley (Sir Paul Beresford) and for Rugby (Mark Pawsey). Our commitment to protecting the green belt is as strong as it has ever been. Changes to the green belt should happen only in exceptional circumstances, and should be fully evidenced and justified through plan making. The policy is clear that once green belts are defined, local authorities should plan positively to enhance their beneficial use, such as by looking for improvements to access and environmental quality.

We have provided £1.79 million of funding across 37 local authorities to improve their capacity to respond to enforcement issues facing their area, and we are working with the Royal Town Planning Institute to overhaul the national enforcement handbook to provide the latest best practice and expertise on shutting down illegal building while ensuring that developers obtain full planning permission before a shovel hits the ground.

[Mark Pawsey]

My hon. Friend the Member for Kettering (Mr Hollobone) mentioned powers to require an inappropriate development to be taken down and the site restored. Does the Minister agree those powers are used far too rarely and, whether we are talking about a development by the Gypsy and Traveller community or by anybody else, there is a sense that if someone builds something, the chances of their being required to reinstate the site are pretty slender, so it is often a chance worth taking?

[Luke Hall]

I thank my hon. Friend for putting that point on the record. It is something I am very happy to talk about further.

Let me touch a little more on site provision. Last February, the Government reminded local planning authorities of their planning obligations to assess the need for sites and to make transit sites available, and, crucially, about the need for joint working between authorities on the setting of pitch and plot targets. It should be emphasised that enforcement becomes much easier once an alternative authorised site exists. Making adequate site provision in plans should reduce the number of unauthorised developments and encampments, and subsequently reduce the disruption they can cause to the wider community.

As such, we have committed to finalising the 2016 draft guidance on assessing housing need for those residing in caravans. That guidance will help local authorities to assess housing need for caravans, but it is not just about ensuring provision; it is about ensuring appropriate provision. Our policy makes it clear that, when assessing the suitability of sites in rural or semi-rural settings, local planning authorities should ensure that a site’s scale is not such that it dominates the nearest settled community.

Oral Answers to Questions

Mark Pawsey Excerpts

Monday 13th January 2020 Commons Chamber

[Robert Jenrick]

The right hon. Gentleman is on dangerous ground talking about the general election. He managed to take one of Labour’s safest seats to a marginal seat, and his colleague—the other shadow Secretary of State—was the co-ordinator of the Labour party’s general election campaign. The facts speak for themselves: last year we built more homes in this country than in any other year for 30 years; we built 1 million homes in the last Parliament and will build at least 1 million homes in the next Parliament; more affordable homes were built under this Conservative Government than under the last Labour Government; and we built more council houses last year than in the 13 years of the last Labour Government.

[Mark Pawsey (Rugby) (Con)]

4. What steps his Department is taking to reduce the time taken to build new homes.

[Sally-Ann Hart (Hastings and Rye) (Con)]

12. What steps his Department is taking to reduce the time taken to build new homes.

[The Secretary of State for Housing, Communities and Local Government (Robert Jenrick)]

We have delivered more than 1.5 million new homes since 2010 and last year saw the highest level of delivery in over 30 years, but there is more to do. Later this year I will publish a White Paper on planning reform, an objective of which will be a simpler and faster system for the benefit of everyone, including homeowners, and small and medium-sized builders.

[Mark Pawsey]

Conservative-led Rugby Borough Council has ambitious plans for social housing in Rugby, replacing unpopular old tower blocks with new, traditional housing. How can the Minister help the council to get on with this as quickly as possible? In particular, what discussions has he had with Treasury colleagues about the interest rate available from the Public Works Loan Board for projects such as this, which provide a very clear social benefit?

[Robert Jenrick]

We want to build more homes of all types. We have delivered 464,000 new affordable homes since 2010, and we have abolished the housing revenue account cap and established a five-year rent deal. Councils can secure grant funding from the existing affordable homes programme, and I am pleased to say that Rugby Borough Council is benefiting from that. In our manifesto, we said that we would create a successor to the affordable homes programme that is at least as generous. Finance from the Public Works Loan Board plays an important role in these investments. In October the Treasury made an extra £10 billion of lending available, and the interest rate remains very favourable, returning only to 2018 levels.

Oral Answers to Questions

Mark Pawsey Excerpts

Monday 17th June 2019 Commons Chamber

[James Brokenshire]

The hon. Gentleman has highlighted the broader issue of the need to increase supply. We have made reforms to ensure that there is clarity in the planning process, and through the schemes that I have mentioned. However, if the hon. Gentleman’s challenge is that there is more to do, yes, there is, and that is why we are determined to see that increase in supply. I think that is the best way to address the issues that he has highlighted in relation to his own constituency and others across the country.

[Mark Pawsey (Rugby) (Con)]

In my constituency, we are delivering homes at three times the rate of the country as a whole. Does my right hon. Friend agree that maintaining supply of all styles and tenures is the key to enabling young people to make a start on the housing ladder?

District Council Finances

Mark Pawsey Excerpts

Wednesday 1st May 2019 Westminster Hall

[Mark Pawsey (Rugby) (Con)]

I beg to move,

That this House has considered district council finances.

It is a great pleasure to serve under your chairmanship, Mr Gapes. I am very pleased to have finally secured a debate on the finances of district councils, which is an important subject. The fact that we got the debate now is testimony to the popularity of debates in Westminster Hall. I shall speak about a report that was published by the all-party parliamentary group for district councils in July 2018. Since our return after last year’s summer recess, I have consistently been applying for the debate, and we have finally got it, and with local elections tomorrow, it is extremely timely—persistence has finally paid off.

I am a Member of Parliament representing a district; I represent the borough of Rugby. I am a former district councillor and member of that authority, and very proud to have represented my community on the council and to have the opportunity to represent it in Parliament. As a former member of a district council, I strongly believe that they have a vital role to play in the next few years in shaping and delivering Government strategy, supporting local growth, building the homes we need and providing the preventive services that are necessary for sustainable health services.

To set the context, there are 192 district councils. In two-tier areas, they deliver 86 of 137 essential local government services to 22 million people, which is 40% of the population. District councils cover 68% of the country by area. One of their most important functions is as the housing and planning authority; they approve 90% of planning applications in their areas and enabled over 91,000 new homes to be delivered last year.

I am very proud to say that my local authority, Rugby Borough Council, saw 584 dwellings completed in 2017-18. It is a great example of a district that looks favourably on house building and development, and it has a very progressive attitude. I know the Minister saw that on his recent visit to Halton, which is an excellent example in my constituency of house building at scale, with a development that will consist of 6,200 homes by the time it is completed.

In two-tier areas, the county council area is divided into a number of districts, which each have an independent district council. I firmly believe that district councils are closer to their residents than are the vast majority of other forms of local government, which is one of the reasons I strongly believe that they should be protected. Rugby town hall is in the middle of our community. It is accessible by all residents and immediately identifiable; it gives a sense of identity to our community. I know there are pressures that are leading some areas to consider alternative arrangements—in particular, there is a move towards unitarisation—but in my area that would be neither practical nor in the best interests of our residents. Districts operate on a size and scale that makes sense to local communities, and they have a unique understanding of the residents they serve.

[Alberto Costa (South Leicestershire) (Con)]

May I take this opportunity to congratulate my hon. Friend on securing this important debate? Blaby District Council and Harborough District Council, led respectively by Councillor Terry Richardson and Councillor Neil Bannister, are both excellently run. Does my hon. Friend agree that any proposal for unitarisation of the Leicestershire area is not welcomed by the district councils?

[Mark Pawsey]

I share the views of my hon. Friend in believing that districts are the right-sized and best-located authorities to deliver a substantial number of services to local residents. I fear that some of that connectivity and identity would be lost in a larger organisation.

I will now talk about some of the things that district councils have been able to do. One key issue that came out of our report is that district councils have a proven track record of devising innovative solutions to transform public services by taking a lead in improving services and providing outcomes for people through better collaboration. That is a really important point, which we will come back to again and again. It is driven by a financial imperative in some instances, but in many ways it is driven by the desire to do things better.

District councils have a proven track record in building better lives and bigger economies in the areas they serve. Through their roles in planning and housing, they act as the building blocks for local economic growth, and in many ways districts work collaboratively with each other and alongside newly established local enterprise partnerships to deliver growth and support local businesses and industry. I believe that district councils also protect and enhance the quality of life by safeguarding our environment, which is an issue we will be considering later today in the Chamber. Promoting public health, leisure and a sound environment is an important role, creating attractive places to live and where people will want to raise their families and build an economy. Districts are also tasked with the challenge of tackling homelessness—again, their proximity to the people and knowledge of individuals is important—and the duty to promote wellbeing.

For district councils to deliver for their residents and the businesses in their area, it is important to ensure that they have sustainable and suitable levels of funding, which is the matter I want to address. It is why the all-party parliamentary group for district councils, which I chair, held a formal Select Committee-type inquiry on the finances of district councils. We published our report, “Delivering the District Difference,” in July 2018. I want to put on the record my gratitude to the 60 local authorities that provided written evidence to the APPG, and I thank the seven district councils, including Rugby Borough Council, that came before us and provided oral evidence to the APPG in Parliament. I am also grateful to many parliamentary colleagues who sat on that committee, particularly the hon. Member for Stroud (Dr Drew), who took part in the evidence sessions and is here today.

Our report was a major piece of work, and we collaborated with the District Councils’ Network to ensure that we were working closely with the sector. I thank the DCN for its valuable contribution to the report. In our evidence sessions, it came across loud and clear that district councils under financial pressures have identified innovative and efficient ways of doing things differently to provide better value for money to local taxpayers. A recent Local Government Association report found that district councils have saved £224 million through sharing services with other districts and bodies, which is far more than any other type of council.

I will give some examples of shared working arrangements that my local authority, Rugby Borough Council, has with others. Rugby has a shared service on building control with Warwick District Council and works on procurement with our neighbours, Nuneaton and Bedworth Borough Council. A particularly useful case study in Rugby involves its working closely with Daventry District Council to provide local crematorium and cemetery services. On its own, neither authority was of a sufficient size to be able to deliver these services efficiently, and my constituents wishing to use crematorium services were obliged to make lengthy journeys to either Coventry or the other side of Warwick. There had been an aspiration for such a service in Rugby for some time, but it was recognised that, in isolation, Rugby was not of sufficient size to deliver it. By working with Daventry and providing a facility on the border between the two authorities, we have ensured that the residents of both local authorities have great provision.

National Audit Office figures show that district councils have experienced the most significant real-terms cut in spending power between 2016-17 and 2019-20, which has required them to be enterprising. One of Rugby’s overarching corporate priorities is to become financially self-sufficient by 2020. It is seeking to reduce its reliance on the sometimes arbitrary and variable central Government funding sources and take control of its sources of income through local taxation arising from economic growth and investment income. When I was a councillor, I was always aware of concerns that the pots of funding might or might not be available. They were sometimes arbitrary or time-limited, which meant that it was difficult to plan for the long term. Rugby aims to be financially self-sufficient so that it is no longer reliant on those variable sources. That will ensure better provision for my constituents in the long term.

All councils have had to work hard to achieve more with less. Between 2010 and 2020, councils in England will have lost almost 60p of every pound of central Government funding. For district councils, that equates to almost £1 billion. I know the Minister recognises the role that districts have played in identifying savings, and is aware of the burden that they have shouldered in recent years.

[Alberto Costa]

I thank my hon. Friend for his generosity in giving way again. The district councils in my constituency have highlighted the ever-increasing cost of waste and recycling services. Proposals to scrap a charge on green waste collection and introduce weekly food waste collections, although laudable, are likely to put significant financial burdens on district councils. Does my hon. Friend agree that, should district councils implement those changes, proper and full support is needed from central Government?

--- Later in debate ---

[Mark Pawsey]

There is a role for central Government, but those are local, devolved matters for district councils. One of the good things about district councils is that, because they are close to their residents, they know and understand what is best for them. My hon. Friend draws attention to the important role that district councils play in environmental matters, which are of real concern to residents.

In recent years, districts have been given more freedoms and powers to stimulate their local economies. In our report, we urge the Government to commit to retain current incentives to help district councils deliver the homes that the country needs. We are keen to see the retention of the new homes bonus. My local authority in Rugby has a very progressive attitude to new house building and is doing well from the new homes bonus, which enables local residents to support the principle that it has adopted.

During our inquiry, the all-party group heard evidence about the savings and efficiencies that can be made in social care by increasing district councils’ capacity to deliver preventive services. Mannie Ketley, the head of service and chief financial officer at Rugby borough council, told us:

“What the districts have shown, working in conjunction with the county council, is that a very much joined up approach has been of huge benefit, so I am confident that as groups of authorities come together, districts are well placed to support in the delivery of social care…Something for districts to consider, or certainly for government to consider, is our role from a prevention perspective and the ability to allow district councils to levy a prevention precept much like upper tier authorities are able to levy that social care precept. There is a huge amount of recognition of the role district councils play at the prevention end of the spectrum”.

They do that through, for example, the provision of recreation facilities that enable people to get out into the open and enjoy the countryside.

The evidence and insights that the all-party group received led us to make seven key recommendations. We identified measures, flexibilities and incentives to stimulate local growth. I want to put them on the record and share them with parliamentary colleagues. The first and most important is that no district council should find itself in the position of negative revenue support grant. That would mean that councils hand over to the Government a proportion of the tax that they raise locally, which would be a real disincentive to grow the local economy. I will come to the way in which our proposals have been addressed.

We argued that the fair funding review should reverse the decline in district council spending power. We suggested that districts should be allowed the freedom to introduce more incentives. We said that measures to increase district spending power should include greater flexibility to raise revenue and introduce incentives to support local growth.

I have already referred to the new homes bonus. We argued that the baseline should be removed, and that there should be a long-term commitment to the new homes bonus. In fact, we went further and said that district councils should be given more financial incentives to deliver more homes. The time available to local authorities to spend right-to-buy receipts should be extended, and districts should be allowed to retain 100% of those receipts.

We spoke about our concern about the lifting of the borrowing cap—I will come to how the issues have already been dealt with by enabling district councils to spend the entirety of their funding. We drew attention, as Mannie Ketley did, to the role that districts play in prevention as housing and planning authorities. They provide leisure and recreational facilities, install home adaptions, tackle homelessness, offer debt advice and deliver social prescription. We also spoke about the need to establish a health prevention fund to support projects that deliver preventive services, which would in turn reduce the financial burden on adult social care.

I am delighted that the Government allocated extra funding in the 2018 Budget and the 2019-20 local government finance settlement, and that two of our recommendations have already been acted on. Just a week after we published our report, the Government announced that they would cancel the negative rate support grant for 2019-20, recognising the disincentive effect. The removal of negative RSG has meant an average saving of more than £350,000 for every district council that would otherwise have faced negative RSG, and more than £50 million overall.

On our recommendation that there should be no further changes to the new homes bonus and that the baseline should be removed, the pot of £18 million is welcome. For my local authority, Rugby Borough Council, no change to the existing threshold means that it would not receive any new homes bonus funding for the first 150 homes delivered each year. The Government have also announced the lifting of the housing borrowing cap, which will be a very significant and helpful move for districts, and more money has been made available through the rural services delivery grant.

The all-party group is delighted that the Government have responded and listened to the voice of districts. We are grateful for that response of recognising the need for change and listening to the voice of districts. At the conclusion of the debate, I hope that the Minister will update the House about the other recommendations that our all-party group made, in particular our call for greater freedom to deliver preventive health services. It is important to invest in such services for the broader welfare of our citizens. I will also be grateful if he outlines what consideration he is giving to the introduction of further freedoms and incentives for districts to grow their local economies.

As the Government look at the technical detail behind the future funding formula and business rates retention, I hope that the Minister will provide some reassurance that districts will continue to receive their fair share of funding. For many local authorities, there is a lack of clarity, and further rates reductions for some will mean a less reliable basis on which to plan budgets appropriately. All organisations, whether in the private or the public sector, benefit from a longer-term perspective, but the funding available from April 2020 remains unclear, as is how it will be distributed and the means of delivery. It is vital for the 2019 spending review to provide the right level of funding for local government, enabling councils to perform their role. Rugby Borough Council, for example, tells me that it faces several risks from the forthcoming funding reform and has concerns about whether it can continue to deliver the high level of services it provides.

The recommendations in our report have many positive aspects across all districts. I am delighted that the Government have already adopted many of them, and I look forward to hearing from the Minister what steps the Government will take in respect of the other recommendations we made.

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[Jim McMahon (Oldham West and Royton) (Lab/Co-op)]

It is a pleasure to serve under your chairmanship, Mr Gapes. I congratulate the hon. Member for Rugby (Mark Pawsey) on securing this debate, although its importance is not reflected in the number of speakers. Nevertheless, that does not mean that the work done by district councillors across England is not critical and life changing to millions of people. I place on the record my thanks to our councillors of every colour, and I wish every candidate success, in different degrees, in tomorrow’s local elections.

The vibrancy of local democracy is what communities are all about. Most of us have come into politics through local government, because we are passionate about the places we live in and the power of positive politics to make a difference. District councils reflect that in a special and unique way because of how grounded they are in the local population. They are important also because they are the primary deliverer of neighbourhood services. I think about what makes an area somewhere decent to live; it is those neighbourhood services that make life worth living—a decent park, good quality countryside, clean and safe environments, and access to cultural facilities such as libraries. They all make up the fabric of our local communities.

There are tensions between districts and councils, but generally they work well together and, between them, provide good quality services for our communities. Like every council in England, they are under huge financial pressure. It is a bit simplistic to look at a spreadsheet, which we do whenever there is a local government finance debate, and to dismiss the cash cuts to district councils as being quite small. Their budgets, however, are much smaller. The percentage loss, particularly across critical neighbourhood services, has been profound in many district council areas. Rugby has experienced a real-terms cut of 47% to cultural services for recreational sport, open spaces and tourism. People feel the impact of austerity even at a district level.

That brings me to the fair funding review. We can all argue about how we have ended up here—we do that on a regular basis. The challenge, which is similar to that for adult social care and children’s services, is that most of the issues should not be party political. They are not political—they are about the delivery of public services in local communities. Regardless of the places we represent and live, we all want good quality public services to be available to everyone.

Political parties need to unite on some of the issues—local government does that anyway—and find long-term, sustainable solutions to how we fund local public services. We have a fair funding review today, but who knows when a general election will be called? A change of national Government matters almost more to local councils than to any other part of government, central or local, because it has a direct implication for how they are financed.

Every Government have always moved money around to favour the areas where they have strong representation. When there was a Labour Government, my locality had enough money to fund public services. It was never quite enough because we always wanted to go further and do more, particularly on housing and the local economy. Then, we had a change of Government and there was a shift. There is a good chance that when the cycle comes back around, the reverse will happen. That is not the way to fund sustainable public services. It does not give credit to our public servants who work for local authorities and it is not fair on the local councillors who have to deal with that cycle of spending turmoil. It is not right for the taxpaying public, either.

On cross-party consensus, the Local Government Association—I declare an interest as a vice-president—carried out an independent review of local government funding a number of years ago. It looked at the then current state and at what type of future structure could provide sustainability and value for taxpayer money. We need to look at some of those ideas.

[Mark Pawsey]

I am listening carefully to the hon. Gentleman, who seems to be making a pretty strong case for local authorities becoming self-sufficient. Is that what he is arguing?

[Jim McMahon]

I understand the calls for that, but I stop short of it, or anywhere near it, because the ability to fund local government public services is so heavily dependent on property taxation, which causes huge geographical inequalities across the country. We want a funding formula and structure where funding follows need. If we give local authorities financial independence there will be significant winners but also significant losers. My strong view is that council tax places a disproportionate burden on local taxpayers in terms of overall taxation. It has been expected to fund too many local public services while the central Government grant is being reduced. Business rates are near breaking point. Those taxes serve a very important purpose, but they also have significant limitations.

Whether it is a district or unitary council, the connection between the tax people pay and the neighbourhood universal services they receive is very healthy for democracy and transparency in governance. I am not sure whether the same is true of social care and children’s services, which in general benefit a smaller number of the local population. Those services are targeted, not universal, and have no relationship to local property values in 1991 or the business rate base that has been built up over hundreds of years. At some point there will have to be a separation of the two, for a purer connection between the council tax that people pay locally and the neighbourhood universal services they receive in return. There should be a properly assessed fair funding formula to ensure that funding goes where older people need care, children need social services, and homes need to be built to resolve homelessness. If we were to do that, it would be a start.

The LGA’s independent review also recommended that there ought to be an independent body to assess the total requirement across England. It would not, of course, set the Treasury’s Budget, but it would make recommendations to the Treasury about the total sum local government needs for the requirements placed on it by central Government. If the recommended sum was £1, the Government might decide to provide 90p of funding and distribute that according to an independently assessed fair funding formula.

Another suggestion, which has huge merit, is that we should establish local public accounts committees. Our councillors see on a daily basis where money is spent in their areas by a range of Departments, in a way that almost no other elected representative does. That provides important insight into how money could be used to better effect. Establishing a local public accounts committee would effectively allow a local authority to hold the ring on all the public sector spending in its area—to ensure that there is no duplication, that any gaps are identified and filled, and that people can work more collaboratively for better public services. Our councillors have proved, and all the evidence shows, that they are best placed to deliver public sector efficiency. They are rooted in the community, they know how to deliver public services, and their insight would help the whole of Government.

To be honest, however, even after all that, there is still not enough money in the system. We know that there will be a funding gap of more than £3 billion by the coming financial year, and by 2024-25 that gap will have increased to £8 billion. The truth is that people are living longer and need care. We know that if we do not give them care in their homes, we will put pressure on the acute sector and the NHS. We also know that children need safeguarding. We can have good processes and screening in place, but ultimately we have to provide protection for young people. The threats are increasingly complex, particularly with the growth of online social media and so on, and councils need the capacity to deal with that. Many are struggling under the weight of those two pressures.

Will the Government meet us halfway and agree to take some of the politics out of local government spending, for the benefit of all of local government? Will they be radical in challenging the Treasury to cough up for once and provide the money that is needed to fund local public services? Will they show leadership and stop pitting council against council? This is not about urban areas and rural areas, or counties, shires and unitaries; this is about local people and local public services, and every man, woman and child in England deserves decent public services.

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[Mark Pawsey]

The debate has focused mostly on finance and funding, but it has been a valuable opportunity to consider the important role that district councils play in communities, and the important functions that they deliver. I am grateful to colleagues who spoke about the roles of their district councils and some of that innovative work, and to the hon. Member for Oldham West and Royton (Jim McMahon) for his reference to the neighbourhood services that district councils provide. It seems that there is a benefit to the delay between asking for a debate and securing it, because it gave the Government time to respond to many of the issues raised, and I am pleased they have taken those points on board.

I was interested in the Minister’s emphasis on stronger economies and the role of district councils in building those economies and developing high streets. I am also delighted that he took on board the bit about better lives. This is not always about finance and pounds and pence; it is about lifestyles and the benefits that councils can bring to the lives of individual residents. I am grateful to the Minister for his remarks, and for the opportunity, once again, to highlight the important role played by district councils.

Question put and agreed to.

Resolved,

That this House has considered district council finances.

Oral Answers to Questions

Mark Pawsey Excerpts

Monday 8th April 2019 Commons Chamber

[Kit Malthouse]

The hon. Gentleman is quite right to raise the fact that demand in all parts of the housing market outstrips supply—social, affordable and, indeed, all ownership models that we put out there. We are putting significant resources behind all parts of the country to build the homes that the next generation needs. We have managed to get net output up from 124,000 after the crash, to 222,000. Indicators for next year are looking pretty good, too, but as my right hon. Friend the Secretary of State said, significant resources are being applied to this problem and we will do our best to try to address it.

[Mark Pawsey (Rugby) (Con)]

The Minister will agree that every opportunity should be taken to increase the stock of social houses for rent, so will he acknowledge the great work of Rugby Borough Council, which is currently arranging for the replacement of old high-rise blocks with a greater number of houses on a conventional streetscape?

[Kit Malthouse]

I applaud any local authority that is putting its shoulder to the wheel of solving the housing crisis. A great sadness of my time as a borough councillor—I was a councillor for eight years—was the fact that the then Labour Government put an end to council house building. We were all induced, effectively, out of that business with decent homes money. We had to get rid of our housing and transfer it to housing associations or other formats. Fortunately, some councils did manage to hang on and I am very pleased that they are now doing their bit.