Local Government Funding: Birmingham

Debate between Steve McCabe and Baroness Stuart of Edgbaston

Tuesday 13th December 2016 Westminster Hall

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

I beg to move,

That this House has considered local government funding for Birmingham.

It is an absolute pleasure to serve under your chairmanship today, Ms Dorries. I asked for this debate because social care services in Birmingham are on the brink of collapse. Public libraries and parks are likely to become a thing of the past and children’s services, which we are supposed to be improving, are braced for swingeing cuts. This is no less than political vandalism; some people in our city are set to experience the most severe and catastrophic consequences of deliberate Government policy.

The core spending power of Birmingham is set to reduce by 5% at a time when some Tory-led authorities have received funding increases of almost 8%. Last February, the Secretary of State announced a hardship fund of transitional money worth £300 million for councils facing the sharpest reductions in grant, but not one penny went to Birmingham. It went to places such as Conservative-led Bromley, Conservative-led Kingston upon Thames, Buckinghamshire and Oxfordshire. How exactly does the Minister justify that state of affairs?

[Ms Gisela Stuart (Birmingham, Edgbaston) (Lab)]

This is not the first year that Birmingham has experienced such a situation. There is a pattern and, on top of that, the councils that get a higher percentage increase also have a lower dependency on core funding. Birmingham is therefore being hit disproportionately year after year.

[Steve McCabe]

My right hon. Friend has anticipated a point that I will make later about council tax, but she is absolutely right: this situation is not new and there is a pattern.

The simple truth is that we are suffering from a legacy of unfairness in our city. Part of that dates back to the 2014-15 and 2015-16 settlements, and as a result the chickens are now coming home to roost on the Minister’s watch. Birmingham, the second city in the country and home to more than 1 million people, is also the second-hardest-hit by Government cuts in the whole country. How is that fair?

Most people would expect a Government Minister to acknowledge the special factors in Birmingham that ought to be taken into account: most of our properties, as I think my right hon. Friend the Member for Birmingham, Edgbaston (Ms Stuart) indicated, are in council tax bands A, B and C, which means that we have a lower council tax base than many other places. We are therefore more heavily affected by the withdrawal of Government grant and raise proportionately less from council tax or precept rises. We suffer from classic big-city issues. Infant mortality is almost 8%—almost double the national average—and life expectancy for men and women is eight and five years shorter respectively when we compare the most affluent and poorest areas. Birmingham is ranked No. 1 in the country when it comes to the total number of fuel-poor households. We should consider Birmingham’s predicament in that context.

This year we expect a £30 million shortfall in the social care budget; that is after the council has followed the Minister’s advice and slapped an extra 2% social care council tax precept on our long-suffering residents. Because extra funding from the social care precept is skewed towards more affluent areas until resources from the improved better care fund become available, we estimate that Birmingham will be disadvantaged to the tune of £98 million in terms of social care come 2017-18. An obvious crumb of comfort that the Minister could offer today would be to say that he will meet us to consider how resources from the better care fund could be used now to recognise the fact that social care spending pressures are being experienced now.

It is not just council services that are teetering on the edge of disaster as a result of deliberate decisions by the Government. Our police have suffered successive cuts to personnel and resources. Just the other day, the chief constable admitted that more than 170,000 calls to 101 went unanswered because of staff shortages. Our NHS is crippled by bed-blocking, rising waiting lists and the spectre of deficits, as well as a sustainability and transformation plan designed to further reduce access to some services.

I have no doubt that, at some point, the Minister will quote his estimate of the city council’s spending figure, as his officials did when they briefed the press earlier today. It is all very well to quote big-sounding numbers from spreadsheets, but what experience does he have of taking an enterprise that is responsible for over 1 million people and slashing its budget by more than £750 million? That is what the Government have done to Birmingham. Health visitors warn that the budget cuts are putting safeguarding at risk. Children’s centres are to be cut so severely that only those who can pass through the super-deprived gateway can expect any help or support. Nurseries, despite the Government’s care offer, are bracing themselves for closures and a massive reduction in services.

The council has almost halved its workforce. More than 12,000 jobs have been lost—those are real people and real jobs. Homelessness prevention services have had to be cut by so much that rough sleeping in Birmingham has quadrupled. On 29 November, a homeless man froze to death on the streets of our city on one of the coldest nights of the year. The Secretary of State for Communities and Local Government, the right hon. Member for Bromsgrove (Sajid Javid), who is not exactly unfamiliar with the city, said at the time:

“I think one person homeless is one person too many so you have always got to do more.”

As the Minister knows, the relentless period of cuts means that we have now reached the stage at which the council has to reconsider the Supporting People budget. I am sure he knows that the sole purpose of that budget was to fund accommodation-related support, particularly supported housing. In 2009, it was his Government who removed the ring fence on the Supporting People budget. We are talking here about homeless young people aged 16 to 25—about care leavers. Elsewhere in this building today, the Minister for Vulnerable Children and Families is telling Members about his seven principles for childcare, which he describes as the heartbeat of his plans. How will that work if there is no supported accommodation for those young people?