Local Government Finance (England)

Mark Spencer Excerpts

Wednesday 10th February 2016 Commons Chamber

[Greg Clark]

Of course there is, because the transitional relief is for the authorities that had a sharper reduction in the grant than others. Blackpool benefited to the tune of £3 million from the improvement of the grant. My hon. Friend the Member for Blackpool North and Cleveleys (Paul Maynard) was wise enough to recognise that, and to recognise the difference it will make to the people of Blackpool, and the hon. Gentleman should do likewise.

[Mark Spencer (Sherwood) (Con)]

One of the most progressive things that the Secretary of State has done is to give local councils a four-year settlement, so that they can now view what their settlements will be into the future and not live from day to day not knowing what their budget settlement would be in the next year.

[Greg Clark]

My hon. Friend is right. This is one of the key requests that local government has made of central Government for many years, and it has constantly fallen on deaf ears. Councils right across the country, with all different kinds of party political control, have welcomed the fact that they will have the chance to look ahead and plan for the future.

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[Greg Clark]

The hon. Lady makes two interesting points. On the first point, about the formula, I agree with her. It is too long since the underlying assessment of needs was updated—it is more than 10 years—and that is why I have proposed to go back to the drawing board and look at the needs and the resources available to each county. She is quite right on that point. On the second point, of course she is right: I recognise that the effect of a 2% precept is different in different parts of the country. The better care fund has been allocated differently precisely to take account of that. I would therefore have thought she welcomed that.

[Mark Spencer]

Does the Secretary of State recognise that councils that are progressive in supporting business and providing housing for their constituents will actually get a more generous income in future than those that do not support businesses coming into their area?

[Greg Clark]

My hon. Friend is absolutely right. It is of course better for councils to face in the direction of bringing successful businesses into their area and benefiting from that, rather than passing all such benefits up to the Exchequer.

A few moments ago, I mentioned the increasing elderly population, but, as I said to the hon. Member for Warrington North (Helen Jones), we have had a decade of significant demographic change without the needs-based formula—it determines how much a well-run council requires to deliver its services efficiently—being revised to reflect that change.

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[Mark Spencer (Sherwood) (Con)]

It is a pleasure to follow the right hon. Member for Birmingham, Hodge Hill (Liam Byrne), who has great experience of working in the Treasury. I gently say to him that I would be more than happy to offer him a deal—not that I have the power to do so at the moment—of swapping per capita funding for his constituents in Birmingham with that for constituents in Nottinghamshire, East Yorkshire, Cornwall, or any such rural area. Today, per capita funding—[Interruption.] If the right hon. Gentleman wants to intervene, he can do so, but shouting from a sedentary position is not the thing to do.

[Liam Byrne]

Let me offer the hon. Gentleman a deal: will he join me in arguing for a special and strong weighting for poverty in the needs-based formula that the Secretary of State plans to review?

[Mark Spencer]

I am more than happy to argue with the right hon. Gentleman, and stand side by side with him if we are talking about older people and those who are less wealthy, who tend to be found in rural areas. That is the challenge that we face today. In those rural areas, the population is not only older, but less wealthy and people have further to travel to the resources and services that they desperately need. For someone who lives in a rural area, needs a hospital appointment and has to use public transport, the public transport links are not as good as they are in urban areas. The doctor is further away than a doctor in an urban area. There are much greater challenges for those who live in rural areas.

[Andrew Bridgen (North West Leicestershire) (Con)]

My hon. Friend should also remember that pupils in Birmingham get funded £1,000 a year more than my pupils in Leicestershire, yet one of the most deprived towns in the county is in my constituency.

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[Mark Spencer]

I thank my hon. Friend for that intervention. Thank goodness that at last the Government are starting to address the challenges faced by rural areas. The Secretary of State has given us a four-year settlement, which means that local authorities will not be living hand to mouth but can plan for the next four years. They know what they have got coming, which means that they can plan to use some of the resources and reserves that some of them are sitting on, to ensure that they protect our constituents and look after their needs. They will not have to sit on those reserves thinking that they may need them within the next 12 months.

That builds in a buffer so that authorities that are keen to promote business and housing developments, and to ensure that the local economy expands, have time to increase the amount of revenue that they generate. That is a positive step forward, and I am working alongside Nottinghamshire County Council and the local enterprise partnership to try to create jobs in my part of Nottinghamshire, so that in future we can live by our own means, and generate and boost the local economy. Authorities that give a boost to their high streets and protect local shops will reap the benefits of that when those successful businesses are able to pay rates back to the authority and contribute to the local economy by creating jobs.

It is sometimes enormously frustrating in Nottinghamshire when I hear councils complain that they are short of cash and will have to shut services, when at the same time one of my district councils is working with the county council to spend £1.4 million on swapping people’s dustbins. My constituents do not understand why we need to spend £1.4 million on that, at a time when the council says it is short of cash to deliver the services my constituents desperately want. Hopefully, with the help of the Secretary of State we can get to a more balanced settlement, have a vision for the future, and mitigate that change with the support that he is providing.