Local Government Finance

Simon Hoare Excerpts

Wednesday 7th February 2018 Commons Chamber

[Jim McMahon]

I want to make some progress, because I am conscious of the number of people down to speak.

We need to ask a number of questions when faced with the settlement. First, does it step up to meet the scale of the challenges facing local public services in England today? Does it meet the challenge of 1.2 million older people who would have been entitled to social care in 2010 who no longer get the care they need? Does it meet the challenge of huge increases in the number of child protection and looked-after children cases reported by the LGA? After nearly a decade of Tory-dominated Government, does it begin to rebuild the essential community infrastructure that was taken away after the financial crash?

My view is that it fails on every one of those counts. The funding settlement today is little more than an insult. I want to put this into context—after all, we can have a party political debate about it and attribute blame, but that makes no difference to the day-to-day experiences of local councils.

[Simon Hoare (North Dorset) (Con)]

Will the hon. Gentleman give way?

[Jim McMahon]

I want to lay out the case, and then there will be a long time for debate—but only if I rush through this to allow time for people to speak.

Central Government funding of local services has reduced by 40%—less money when demand is increasing—and we all know that it has not been distributed evenly. The overall reduction has hit local authorities with lower tax bases hardest because they are more dependent on central Government grant. The UK Government’s total spending on local government, as a share of the economy, has fallen sharply. In 2010, it accounted for 8.4% of the economy; by 2022, the figure will be down to 5.7%, which constitutes a 60-year low. Yet councils in England still have 1,200 statutory obligations. They have less money, but the same is required of them. That has had an impact on people, in that 811 fewer people now work in local government. The local government workforce today is the lowest since comparable records began, when the central Government workforce is the highest that it has been since comparable records began. Moreover, the figures are not fairly distributed across government, let alone geographically.

If austerity had not kicked in and affected our local council base, councils today would have £14 billion more than they have. That would be sufficient to deal with the crisis in social care and the crisis in children’s services.

--- Later in debate ---

[Simon Hoare (North Dorset) (Con)]

I say, with apologies to Jane Austen, that it is a truth universally acknowledged that all councils complain about a lack of money to all Governments, irrespective of which party is in control. Like many colleagues, I served as a councillor. I was a district councillor for a dozen years and a county councillor for three, so I remember having to juggle the income reductions that started under a Labour Government in 2006-07. It just sort of happens.

I welcome the announcement that Dorset will receive an extra £1.2 million to deal with adult social care and that our total rural services delivery grant, which is hugely important, will be £1.5 million. I agreed very much with a lot of what the shadow Opposition spokesman said—I appreciate that he was not quoting his own commissioned report—but whichever idiot came up with the answer that the cost of delivering services in a rural area was equal to that of delivering them in an urban area needs to be certified, because we all know that geography and population sparsity lead to increased costs. I also welcome last week’s announcement by the Department of a successful bid to the housing infrastructure fund of £4.1 million, so it was not too bad a week of news for Dorset. I agreed with the hon. Member for Sheffield South East (Mr Betts) when he pointed to the huge debt of thanks that we parliamentarians owe to our councillors for the work they do, against the backdrop of a challenging financial position, in continuing to deliver services and to keep the wheels on the bus—if Members will forgive that analogy—at a time when incomes have been falling and savings have had to be made.

My constituency is served by three councils: East Dorset District Council, North Dorset District Council, and Dorset County Council. Although we have a two-tier authority, the county council provides, on average, 85% of the services enjoyed by the county. Over the last few years, my postbag, my inbox and visitors to my surgeries—as well as the leader and the chief executive of the county council—have made it clear that there is real, tangible pressure on the delivery of adult social services, services for children with special educational needs, and wider children’s services, as well as, of course, rural transport.

All the Dorset councils, district and county, have made great strides in reducing their costs and making themselves more efficient, and the tri-partnership between West Dorset, Weymouth and Portland, and North Dorset District Councils has made huge savings. The councils have cut through the fat and the flesh, have gone through the sinew and the muscle, have been chipping into the bone, and are now starting to suck out the marrow. They are trying to author the next steps of their future in order to deliver the services that hard-working council tax payers demand and need, taking account of the demographics, as 65% of my constituents are over the age of 70.

Those councils have submitted a proposal for the reorganisation of local government. They recognise that it is a question of not just trying to demand extra income, but of trying to deal with what they receive in a smarter and better way. The “two-unitary” solution for the county that we are seeking, which is with the Department at the moment, commands 62% of public support. It is supported by seven of the eight Dorset MPs and eight of our nine councils, as well as Bournemouth University, Poole Harbour Commissioners, the local enterprise partnership, Dorset chamber of commerce and industry, the clinical commissioning group, the police and crime commissioner, and the Dorset Association of Parish and Town Councils.

I plead with the Government. I entirely accept the need to reduce expenditure and to balance the books. I entirely understand why local government has shouldered a very large proportion of central Government savings. I support the Government absolutely in that endeavour: what Conservative who understands the importance of proper control of public money would not? However, I cannot stand by, and will not stand by, if the proposal that was submitted to the Government is delayed still further, or rejected out of hand. The continued provision of services for children and elderly people in my constituency is now solely reliant on this change, so it needs to be delivered.