Localism Bill

Shabana Mahmood Excerpts

Monday 17th January 2011 Commons Chamber

[Shabana Mahmood (Birmingham, Ladywood) (Lab)]

I am grateful for the opportunity to make a contribution to the debate. I would like to focus on three elements: first, my concerns regarding the impact of the devastating cuts to local government in the recent financial settlement, which I believe do not correlate with the Government’s professed desire for localism and giving more power to local people; secondly, the arrangements in the Bill for directly elected mayors in 12 major English cities, including my own city of Birmingham; and thirdly, the provisions in relation to housing.

I support the principle of giving people a greater say in how their communities and services are run, but that has to take place in tandem with two things: fairly funded local authorities, and thereby fairly funded local services; and investment in the capacity and skills of local people to enable them to take control regardless of their social background. Through the Bill, the Government try to talk a good game. However, it comes at a time when the Government at the centre have made a choice, giving local authorities a devastating financial settlement that was far worse than expected, with the worst cuts for a generation.

The Government seem to think that merely by saying that they are committed to localism, and by repeating their lines in support of local people taking control at local level, that somehow, as if by magic, true localism will emerge. However, without a fair settlement for local government, no such localism can emerge. The Bill seems to give a huge amount with one hand, but the Government, through the financial choices that they have made, are taking a lot more away with the other. The simple truth is that localism cannot deliver for local people if all the decisions being made at local level are focused on implementing centrally imposed cuts that are going too far and are too deep.

[Oliver Colvile (Plymouth, Sutton and Devonport) (Con)]

Does the hon. Lady not recall that it was the former Chief Secretary to the Treasury, in the previous Labour Government, who left a letter that said there was no money left?

[Shabana Mahmood]

I am afraid that that is a rather poor attempt at hiding the deep unfairness of the settlement imposed on local government by this Government. That was a choice that could have been made differently, but was not.

[Toby Perkins]

On the basis of what the hon. Member for Plymouth, Sutton and Devonport (Oliver Colvile) has just said, is it not surprising that a council such as Dorset should have a rise this year, when most councils in the most deprived areas have seen massive cuts? If the problem is a lack of money, why is it that the authorities that are most able to bear that burden are the ones that are better off under this Government?

[Shabana Mahmood]

I agree with my hon. Friend entirely, and I was just coming to that point.

I fear that it is the cuts that will define the future shape, life chances and success, or lack thereof, of Birmingham residents, not the Localism Bill. The provisional local government settlement for Birmingham was a confirmation of the worst-case scenario. Birmingham has to make savings of approximately £170 million in the next two years, and is one of the hardest hit local authorities. In fact, “one of the hardest hit” is a depressing and hideous phrase that the people of Birmingham are having to get used to, after being one of the hardest hit areas in the police settlement.

The sheer size of the cuts in Birmingham will prevent the people of Birmingham from getting the most out of the localism agenda. More affluent areas, which have perversely done better out of the local government financial settlement, have greater scope to gain more from localism. I fear a prevailing culture where those with the deepest pockets will be more able to make themselves heard. If the Government truly want localism to be a success, and want strong local communities up and down the country, they first need to revisit the unfair settlement for local government. Anything less than that is a hollow and unworkable localism, which will not deliver for every community.

The Bill also creates arrangements for directly elected mayors in 12 major English cities, including Birmingham. I am in favour of giving local people a choice as to whether they want a directly elected mayor for their area. An elected mayor could offer highly effective local leadership, and I supported the introduction of this model of local government when it was introduced by the Labour Government. However, I am against imposition. The Bill imposes a shadow mayor on the people of Birmingham, subject to a confirmatory referendum. That aspect needs to be considered again. The people of Birmingham are quite capable of deciding for themselves whether they want a directly elected mayor, rather than having one imposed from the centre by the Secretary of State, subject to later endorsement. Where, may I ask, is the localism in that? If the Secretary of State truly trusted local people to exercise their own judgment about what is right for their area, he would not choose this path.

Earlier, the Secretary of State was asked about his motive for introducing shadow mayors. He said that it was so that people could get ready for having a mayor. People are not stupid. They do not need a practice run dictated to them by the Secretary of State. Let them make their decision and simply get on with it. I am concerned that the shadow arrangements—making the leader of the local authority in the 12 cities the shadow mayor—will create a systemic bias in favour of the shadow mayor, and will make it more difficult for people from all walks of life to put themselves forward for mayorship. That creates an imbalance in favour of the shadow mayor and, regardless of whether that individual is a Labour, Tory or Liberal Democrat councillor, the principle is not sound and is anti-democratic.

The Bill also makes a number of changes to the duties of local authorities in relation to housing. Every single week since I was elected in May, I have met constituents at my advice surgeries who are desperate for housing: people who are on the waiting list for social housing; people who have been waiting many years for a transfer to more suitable social housing accommodation; people on the verge of being made homeless; and young people despairing of ever getting on to the social housing ladder. I am therefore reminded every week of the urgent need to increase the stock of social and affordable housing.

Given that, I wish to make two points about the current changes. First, the changes to the current system are not taking place in isolation. They are doing so with huge changes to housing benefit rules, and therefore councils and social landlords will be under huge pressure. I am not convinced that the changes introduced in the Bill will do anything to alleviate that pressure. The proposals will have to be looked at carefully in Committee.

Secondly, the real challenge is to ensure that more homes are being built. I am alarmed at the reduction in funding for new social homes, and the warnings and figures from various groups involved in building homes. Research recently published by the National Housing Federation shows that, since the general election, local authorities have ditched plans for 160,000 new homes. It believes that, once the homes that Labour started building are complete, no new social homes will be built for the next five years. That would be a complete disaster and I suggest that that should be looked at urgently. No amount of changes to the current system can compensate for the lack of available social and affordable homes. Getting to grips with that should be the priority at this stage.

In conclusion, the Bill has promised much, but the scale of the cuts being imposed on local government, and the deficiencies in some of the Bill’s proposals, will mean that it delivers very little.