Local Government Funding: Rural Areas

Peter Heaton-Jones Excerpts

Monday 11th January 2016 Commons Chamber

[Peter Heaton-Jones (North Devon) (Con)]

I congratulate my hon. Friend the Member for Beverley and Holderness (Graham Stuart) on securing this debate and on the fantastic work he has done in this area, particularly on the Rural Fair Share campaign, of which I am very proud to be a patron.

I will address my remarks principally towards North Devon, but will start with some general comments. We must remember from the outset that we are talking about taxpayers’ money, so it is right that we take careful decisions. I get that. All areas of spending have to be reviewed. The Government are making considerable progress in putting the nation’s finances on a sound footing, compared with what we inherited. I get that too and the people of North Devon also get it.

However, this settlement raises considerable concerns for North Devon. First, the overall grant for North Devon District Council is reducing from £4.9 million this year to £4.18 million in the next. That does not sound like a big figure, but it is a significant reduction for a small local authority. I have met the leader of the council, Councillor Des Brailey, and he has left me in no doubt whatever that he faces some very difficult decisions as a result of the settlement.

I want to pick up on a couple of points that have been made by hon. Members on both sides of the House that are relevant to the challenge faced by North Devon District Council. I am delighted that the hon. Member for Workington (Sue Hayman) is co-sponsoring the debate. It is good that it is a cross-party initiative, although the Liberal Democrats are conspicuous by their absence. None the less, the hon. Lady made a very good point about visitors to her area and mine. North Devon prides itself on being a very popular tourist destination, but we get not a penny more for the extraordinary increase in, in effect, the population of North Devon that occurs for several weeks of the year. This settlement does not take account of that fundamental unfairness.

My hon. Friend the Member for North Dorset (Simon Hoare) made a very good point about areas of deprivation and coastal areas in particular, as did my hon. Friend the Member for South East Cornwall (Mrs Murray). He said that we have areas of coastal deprivation that often go unnoticed. I have invited the Minister to visit Ilfracombe in my constituency. I am sure that his response is in the post. In Ilfracombe, I have one of the most deprived wards in the south-west. That is something that North Devon District Council has to deal with, but this settlement does not allow it to do so.

We must also consider the extra money that the Government give to rural areas such as North Devon. Yes, I am delighted that that is being increased nationally to £65.5 million in the next four years, but it is being back-loaded, not front-loaded, and there will be only marginal benefit to North Devon next year. The total figure is considerably lower than the £130 million increase that was calculated by the Rural Fair Share campaign, and it will simply get us to a standstill—it is considerably less than what is required.

The settlement figure for Devon County Council has also been reduced, which is a worry because that will simply add to the pressures on local services and council tax payers in North Devon. To set a balanced budget for 2016-17, Devon will need to make savings of more than £34 million, on top of savings made in the past five years, which amount to £174 million. That is a huge reduction and a huge challenge for Devon County Council.

The two authorities to which I have referred—North Devon District Council and Devon County Council—are both well-behaved, competent, Conservative-controlled councils. That is the point: councillors and officers are working hard to deliver good services and value for money for the taxpayers of North Devon. The Government should be helping them to do that, although I fear that with this current settlement, they are not doing so.

[Mrs Sheryll Murray]

The system in Devon is slightly different from that in Cornwall because we have a unitary authority and Devon has a two-tier primary authority system. Does my hon. Friend notice that his constituents are having excessive council tax imposed on them by services being offloaded from the district and county authority on to town and parish councils, as is happening in Cornwall?

[Peter Heaton-Jones]

We could happily spend considerable time on the debate about unitary versus multi-tiered authorities, but my focus is to ensure that whatever system we have presents value for money to council tax payers. That is what is being delivered by Conservative-controlled North Devon District Council and Devon County Council, and the Government need to assist them in that.

[Andrew Bingham (High Peak) (Con)]

My hon. Friend makes a great point on behalf of his local councils, which very much mirrors my own experience in High Peak. Almost 10 years ago we entered into a shared service review with Staffordshire Moorlands, thereby saving our council tax payers a lot of money. It was a trailblazing scheme across regions and across the county, yet we have all the problems that my hon. Friend mentions about tourism and we do not even qualify for the rural services delivery grant. We are being kicked twice, and it is making life extremely difficult for what is a prudently and well-run Conservative local council in the High Peak area.

[Peter Heaton-Jones]

My hon. Friend makes a strong point on behalf of his area which, as he says, is mirrored in North Devon.

In 2016-17 some specific grants were included in the funding base for Devon County Council, and if those are excluded to give a more accurate like-for-like comparison, the reduction in grant for that council is 17.4%, compared with an average of 16.6% for the shire counties. Not only do we as a rural area do worse in comparison with urban areas, we are even doing worse in comparison with other rural areas. That seems something of a double whammy for Devon.

At the other end of the local government spectrum, let me echo a point that was ably made by my hon. Friend the Member for North Dorset—he has just retaken his place. He noted how one of his town or parish councils had complained how difficult it was to plan ahead because of the annual “will they or won’t they?” capping saga, and exactly the same point was made to me by Barnstaple Town Council, which has the same horror to face every year. That is stopping it planning ahead and adequately providing the services that it needs to provide, and I urge the Minister to consider that.

There are some beneficial aspects to the settlement. I accept that the rural urban funding gap is gradually closing, and the longer, four-year settlement period is welcome as it will help local authorities considerably with their forward planning. We will not have that worried look at the Advent calendar every December to wonder when the settlement will come and what it will be, and I welcome those two points.

[Graham Stuart]

I hate to interrupt my hon. Friend as he moves to his peroration, but I do not believe that there will be any closing of the gap. The proposal is precisely for lower reductions in the central Government grant for metropolitan areas than for rural areas and, even with the increase in the rural services delivery grant, we will see a widening, not a closing, of an already iniquitous gap.

[Peter Heaton-Jones]

I am sure the Minister will clarify that. I was coming on to say in my concluding remarks that although those two elements appear to be welcome, they are not enough. I say that quite plainly to the Minister.

I am disappointed overall. I believe there is more we can do as a Government to assist areas such as North Devon. That is why I have written to the Secretary of State. I have in my hand a piece of paper: a letter I have written to the Secretary of State. It is designed to be helpful and to suggest ways in which we could, as a Government, help areas such as Devon, in particular North Devon. I hope we can achieve a fairer settlement for these areas. I look forward to working with the Minister, his colleagues and other colleagues in areas similar to mine to help to make that happen. I say this gently but firmly to the Minister, and, I have to say, with some regret: at the moment, the Government have got this wrong. We have time to put it right and I appeal to the Minister that we do so, for the sake of North Devon and other rural areas.