Police Funding Formula

Steve McCabe Excerpts

Tuesday 1st March 2016 Commons Chamber

[Steve McCabe (Birmingham, Selly Oak) (Lab)]

I want to begin by stating what Her Majesty’s inspector of constabulary for West Midlands police, Wendy Williams, said about the force in her most recent report. She believes that it is

“exceptionally well prepared to face future financial challenges.”

She says that it has “robust management” of its current demand, finances and plans for change, and that it has embarked on an impressive five-year change programme to transform how it intends to deliver policing. In last year’s Valuing the Police programme, which considered how forces met the challenge of the first spending review, West Midlands police was judged to be outstanding. I thank the Labour police and crime commissioner, David Jamieson, our former chief constable, Chris Sims, and our new chief constable, Dave Thompson, for doing such a good job on our behalf.

The Government have suggested that west midlands Labour MPs are wrong to complain that our police are being short-changed. The Minister thinks that West Midlands police is squirrelling away money and sitting on huge reserves. Let us look at the reserves of the largest force in England and Wales outside the Met. Not only does it serve a population of nearly 3 million people and an area of some 348 square miles, but, as HMIC notes, the area served by the West Midlands force faces the most significant challenge of terrorism and extremism outside London—a point alluded to by the hon. Member for Kingston and Surbiton (James Berry). The force is in fact a national lead in the delivery of counter-terrorism.

The force complies with the requirement to hold a general reserve—in its case, about £12 million, which can be compared with figures of about £26 million and £23 million for the Met and West Yorkshire police. Of its remaining reserves, about £10 million is set aside to address redundancy and equal pay, in a force still suffering the fall-out from the “A19” forced retirements. A further £12 million is set aside for the self-funded insurance reserve. I expect the Minister is familiar with the problems of insurance for police vehicles and how most forces hold a reserve to cover this. About £3 million is set aside for the uniforms and protective equipment reserve, which is not a high figure for the second largest force in the country; about £2.1 million for the major incident reserve; and about £18 million for the capital reserve. The Minister will be aware that his officials advised that forces should prepare for a reduction in the capital grant in this year’s settlement. I understand that the capital grant for the west midlands is now about £2.9 million—a cut of about £2 million on previous years.

Like Her Majesty’s inspector of constabulary, I see a force with robust management of demand and finances, and one that has proved to be outstanding in facing up to the challenges that austerity has imposed on it. It is misleading for anyone to suggest that it is sitting on massive reserves, and I invite the Minister to look again at the figures before anyone in the Government is tempted to repeat such a charge.

On the question of the formula, may I invite the Minister to clear up the situation with regard to claims by the Conservative PCC for Northamptonshire that he has been led to expect a transfer of funding from urban forces such as West Midlands police to rural forces such as his? Last week, the Home Secretary did not feel able to tell my hon. Friend the Member for Birmingham, Northfield (Richard Burden) that she was not planning such a transfer of funds. Would the Minister like to take this opportunity to come clean about his intentions?

[The Minister for Policing, Crime and Criminal Justice (Mike Penning)]

The hon. Gentleman is citing the figures with which I supplied him, so I will not contradict them. I will give my interpretation of them when I sum up. There is no funding formula change on the books, so nobody can say that they are going to be better or worse off until we come forward with the formula.

[Steve McCabe]

It is certainly true that the Minister gave me a glimpse of some of the figures and I am extremely grateful to him for that, but let me reiterate my point: the Conservative PCC said that he had been tipped off that there would be a transfer of funds from urban to rural forces. My constituents want to know why more money is needed to police Surrey and Northamptonshire than to police the west midlands. Why do we get less while they get more?

[Mr Kevan Jones]

We could ask the same question about the local government formula, which gives more money to Surrey than to deprived areas such as Durham and my hon. Friend’s area. The suspicion is that this funding formula will also be used to divert money away from Labour areas to Conservative areas.

[Steve McCabe]

If we look at past form, we will see that that is certainly the implication. I was interested to hear the hon. Member for South Dorset (Richard Drax) implore the Minister to think again about fair funding, on the basis that a fairer funding arrangement would give the force in Dorset an extra £1.9 million a year. I remind the Minister that, under the same fairer funding formula, the west midlands would get an extra £40 million year. When it comes to the transfer of resources, I hope he will bear that in mind.

The reality is that, far from getting extra funding, over the past five years our force has had to contend with £180 million of cuts—the highest in the country. The workforce has been reduced by 3,000 and the incoming chief constable has been clear that the force will need to reorganise to “cope with the gaps”—those are his words—that it now has to carry. The mistakes in the formula mean that forces are now planning against a one-year rather than four-year profile, which will be a much more difficult challenge. I would like to hear the Minister explain how he thinks the chief constable of West Midlands police is meant to plug those gaps.

I want to be clear that I do not deride the Home Secretary for saying that volunteers with specialist skills in IT or accountancy might be useful in helping to tackle cybercrime. I am curious to know why it is necessary to create a new position of police support volunteer, rather than simply recruiting more special constables with particular skills and expertise. Is that part of a wider volunteer plan?

[Mike Penning]

The answer is very simple. A special constable is an unpaid but warranted officer, the same as a full-time officer. Many people do not want to carry the warrant, but they want to help their local police force. That is why there is a separate category and they are not all specials. If they were, they would all have to be warranted.

[Steve McCabe]

I am grateful to the Minister for that response, and perhaps he will show us the consultation that took place to show the support that exists for the new role of police support volunteer. I would welcome the opportunity to have a look at that.

To go back to funding for a second, does the Minister really consider it a triumph for his colleagues the hon. Members for Solihull (Julian Knight) and for Dudley South (Mike Wood) to claim credit for a 4.6% rise in the police precept paid by the taxpayers of the west midlands to make up for the money being given to places such as Surrey and Northamptonshire? Is that how we will be forced to plug the gap—by paying more pounds for fewer police in our area?

We are repeatedly advised that crime has fallen and therefore, by implication, the Government’s cuts are justified. I assume that the Minister does not dispute the claims of the Office for National Statistics that crime rose by 6% nationally for the year ending September 2015, and that violence against the person rose by 13%. I do not dispute that some types of crime have fallen, but I am not interested in trying to manipulate the figures to mislead anyone. Is it not important that the Government give a full picture and come clean on what the figures actually mean?

[James Berry]

Does the hon. Gentleman concede that that report stated that there had been an increase in the recording of crime, and that the reporting and recording of crime have improved a great deal, which explains some of the rise that has been seen?

[Steve McCabe]

I concede that the report actually said that certain types of sexual offences were being reported differently, which accounted for the rise in that area. The report also clearly pointed out that violence against the person had risen by 13%, and I hope that the hon. Gentleman accepts that. As I said, we need clarity on the figures rather than using them to try to paint a picture that may be misleading.

There is one more point I would like to make. As I indicated earlier, the West Midlands force faces the most significant challenge of terrorism and extremism outside London, and we recently suffered a spate of gun crime in parts of Birmingham. The chief constable is set to increase the number of armed officers, and I understand that that is in line with Home Office advice. West Midlands police has about 260 armed officers, and an uplift in line with Home Office thinking would mean a further 130 officers. Where will the funding for those additional armed police officers come from, and where will the personnel come from? Will the force be expected to recruit additional officers, or will those engaged in neighbourhood policing or response policing be required to transfer to those new duties, further depleting those available for existing police tasks?

It is not bluff and bluster that we need today, but honest answers to legitimate questions and queries from people such as myself, who are genuinely worried that the formula, the funding and the rhetoric do not match the heroic efforts of West Midlands police to meet the demands of the community that it seeks to serve.

--- Later in debate ---

[Mr Jones]

I totally agree with the hon. Gentleman. That is exactly what was going on. We were to have the formula wrapped up going into the spending review, but what we are in store for is exactly what has happened in local government funding. We did not get a fair local government funding formula: we have a skewed formula that moves resources from the most deprived communities in this country to—lo and behold!—the more wealthy parts, which are represented by Conservatives.

In local government funding, just by chance—hon. Members should not ask me how this has happened— 85% of the gainers happened to be in Conservative seats. I suspect that that is what was going on with the police funding formula. The Government had not reckoned with the PCC for Devon and Cornwall, who questioned the process.

We must also put the formula against the other things that the Government and their previous incarnation, the coalition, have done to policing in this country.

[Steve McCabe]

Like me, I am sure my hon. Friend recognises that the Minister is a pretty straightforward guy. Given that we have ended up in this situation and that we have been unable to resolve it—it will be four years before police forces can plan a long-term budget—would not the fair thing be to remove any doubt or suspicion and subject the formula to independent scrutiny? In that way, we could all be absolutely certain that it was fair.

[Mr Jones]

I agree with my hon. Friend—I will come back to that in a minute—but the real issue is that what was envisaged is exactly what we have seen in local government. Under the new formula, the resources would not have been devolved to the areas that needed them, but the blame for the cuts would have been. The Government have used that formula for many years now.

--- Later in debate ---

[The Minister for Policing, Crime and Criminal Justice (Mike Penning)]

May I welcome the hon. Member for Rotherham (Sarah Champion) to the Dispatch Box? I think she may be there for some time, because she delivered a much better speech than those delivered by the shadow Policing Minister and the shadow Home Secretary last week.

I agreed with some of the hon. Lady’s comments, particularly her closing remarks about how this country and the police deserve a fair funding formula. The reason that did not happen under 13 years of Labour, and probably even before that, is that it is very difficult to achieve. As I have previously said from this Dispatch Box, there is no doubt that there will be winners and losers if we change the formula. As the Home Affairs Committee has said, however, the existing formula is opaque and we desperately need to change it—and fairly.

[Steve McCabe]

Will the Minister give way?

[Mike Penning]

In a moment. I just want to make a little progress and then I promise that I will give way, because I am going to refer to the west midlands at length.

It is fair to say that policing is undergoing continuous change and that it has changed considerably even in the past five years. The National Audit Office has rightly indicated that the way in which we are making the reporting of crimes more effective and accurate should not be used in an attempt to say that crime has suddenly risen. Since 2010, for lots of different reasons, there has been a reduction in crime, but there have been some increases in the reporting figures in the past year. We accept that and are looking at it very carefully, but the NAO made a specific point. In some areas, it is absolutely brilliant that more people have the confidence to come forward to report crimes such as sexual abuse and domestic violence, which historically have not been reported as much as we would have liked and have probably not been treated as correctly as we would have wanted by police forces around the country. I think that most people would accept that.

[Steve McCabe]

The Policing Minister has said that achieving a fair funding formula is incredibly complex, and he has acknowledged that it is beyond the competence of his civil servants. The hon. Member for South Dorset (Richard Drax) has said that he is seeking fair funding, as are the rest of us. Given the difficulties, doubts and suspicions, will the Minister give a commitment that any future fair funding formula will be subject to proper independent scrutiny and analysis, so that we can all have confidence in it?