Local Government Funding: Rural Areas

Oliver Heald Excerpts

Monday 11th January 2016 Commons Chamber

[Graham Stuart]

My hon. Friend is absolutely right. Withernsea, a town in my constituency, is among the 10% most deprived areas in the country, and I know that similar stories can be told about colleagues’ constituencies throughout England. It is not true that there is no deprivation in rural areas. On average, it is not true. On average, the urban resident receives more. Urban areas do not consist of the most deprived, concentrated communities. They contain some communities of that kind, but on average people in urban areas earn a great deal more than those in rural areas.

[Sir Oliver Heald (North East Hertfordshire) (Con)]

North Hertfordshire District Council is an excellent council which has been making efficiencies for years. Does my hon. Friend agree that expecting it to accept a 57% cut in grant year on year is a very big ask indeed?

[Graham Stuart]

It is, and where will the pressure fall? It will fall either on services, as it already does, or on the only thing that the council has left, which is council tax.

One of the aspects of this settlement—perhaps the most notable aspect—is the turnaround in the approach to council tax. The rural resident, who is already much more highly taxed, will experience compounded council tax increases. If council tax goes up by 4% in April 2016, and then by 4% a year in 2017, 2018, 2019 and 2020, that will mean five years of compounded 4% increases before the 2020 general election. I suggest to Ministers that they may wish to think long and carefully before presenting that result to the electorate in 2020, while suggesting to rural England that it should support us again.