Local Government Financing Debate

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Local Government Financing

Nadhim Zahawi Excerpts
Tuesday 29th June 2010

(14 years, 4 months ago)

Commons Chamber
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Jack Dromey Portrait Jack Dromey
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It would appear that, in your local authority, they have found Lord Lucan, and they are now looking for the Liberal Democrat and Tory councillors. In Birmingham, they are going to have to stand up and be counted.

There is a grotesque contrast between the £2 billion levy on the banks—not on the bankers, by the way—on the one hand, and £11 billion off welfare and £12 billion on VAT on the other. I want to take this opportunity to pay tribute to the leadership shown last night by the truly honourable Members for Colchester (Bob Russell) and for Portsmouth South (Mr Hancock) when they voted against their own Government in opposition to the VAT increase.

The shadow Secretary of State was absolutely right to point out earlier that the areas with the greatest needs should not bear the brunt of the cuts. Birmingham has great problems of multiple deprivation and high unemployment, yet, as a consequence of the Budget, it will see the biggest cash reduction—more than £12 million. It will have the largest cut in area-based grant in any local authority in Britain, at £8 million, and the seventh largest cut to the school development fund, at £633,000. That money was designed to help struggling schools to succeed.

Birmingham will have the second largest cut to Connexions, at £2.7 million. This will harm the ability of our city to help the young into work and to get apprenticeships. It will also have the largest cut to the children’s fund, at £1.14 million. That will damage the capacity of our city to reach out to disabled, disadvantaged, troubled and sometimes abandoned children. It will also see the largest cut to the working neighbourhoods fund—a highly successful programme of concentrated, co-ordinated, community-led action to get Birmingham’s citizens off benefit and into work.

I have seen these programmes at first hand, in the form of the remarkable Employment Needs Training Agency in my constituency, and three excellent employment Connexions contracts focusing on the long-term unemployed, lone parents, ex-offenders, those who have engaged in alcohol abuse, and those who lost their jobs under Mrs Thatcher in the 1980s and never worked again. Those programmes have an outstanding track record of reaching out to those people, giving them hope, and helping them to rebuild their lives and get back into work.

Nadhim Zahawi Portrait Nadhim Zahawi (Stratford-on-Avon) (Con)
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The hon. Gentleman speaks eloquently about the problems in Birmingham without telling us how we got there in the first place. Does he think that borrowing £500 million, not every month or every week but every day, represents responsible behaviour towards the people of Birmingham?

Jack Dromey Portrait Jack Dromey
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We have a problem as a consequence of people like you: bankers.

Nadhim Zahawi Portrait Nadhim Zahawi
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I am not a banker.

Jack Dromey Portrait Jack Dromey
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There are more bankers on the Government green Benches than there are in the square mile of the City of London.

Those admirable community projects’ money will run out in March 2011, and they are now facing a cut of up to one third. The impact of that on those projects and those communities will be absolutely devastating.

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Gordon Marsden Portrait Mr Marsden
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Thank you, Madam Deputy Speaker.

This huge leap in the dark is based on the market fetishism and sado-monetarism that are practised by so many Members on the Government Benches. The Office for Budget Responsibility has shown that the Budget of my right hon. Friend the Member for Edinburgh South West (Mr Darling) was prudent in its estimate of the budgetary outlook.

Nadhim Zahawi Portrait Nadhim Zahawi
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Will the hon. Gentleman give way?

Alec Shelbrooke Portrait Alec Shelbrooke (Elmet and Rothwell) (Con)
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Will the hon. Gentleman give way?