Local Government Finance (England)

Tim Farron Excerpts

Wednesday 9th February 2022 Commons Chamber

[Tim Farron (Westmorland and Lonsdale) (LD)]

I pay tribute to all those who work in local government, particularly for the immense efforts that they have made over the past two years to meet the needs of their local communities, and to the elected members in all parties who serve their communities for not much recompense. It is a noble calling and something I enjoy doing; we should pay tribute to them. I must also throw in a mention of those who serve on parish and town councils, most of whom do so without any recompense whatever and have stepped up to the plate.

Over the past few years, as we have effectively seen caps on public spending in the principal authorities, the ability to raise a precept without going through the process of a local referendum has meant that many parish and town councils have really stepped into the breach. For their sake as much as for principal authorities, we should regret that we are still on one-year budgets. To have a single-year settlement for a fourth year disrespects all local government authorities—the parish and town councils that are not in direct receipt of grant support, as well as the principal authorities that are—and makes it very hard for them or the organisations that depend on them to plan. That is not an argument about the amount of money; it is about levelling with authorities and ensuring that they can plan ahead and serve their communities efficiently and with ambition.

There is an awful lot that we could talk about, but I do not want to take too long or tick every box, so I will make just a few observations. Like other hon. Members, I regret very much the failure to keep public health spending in line with inflation, or anything like it, as we learn more and more about the importance of preventive healthcare, both physical and mental. I pay tribute to Colin Cox and all those in Cumbria’s public health team who have worked utterly tirelessly through the pandemic, keeping us safe and giving us the advice, confidence and reassurance that we all desperately need. They have been responsible for excellent systems throughout this very difficult time.

It is worth bearing in mind just what this means—not funding public health well. While tiers 2, 3 and 4 of the mental health support framework for young people are provided through contracted services, through the NHS and through child and adolescent mental health services, tier 1 is the responsibility of public health services run at county level. The poor funding for public health in our county means that the amount we spend on young people’s preventive mental health care in Cumbria equates to 75p per child per year.

Let us ignore for a moment the moral wrong of that small amount of funding. What does it mean in terms of the consequences in later life? I carried out a survey last year and found that 28% of young people referred to CAMHS were waiting over six months to be seen. Unless we invest in tier 1 preventive mental health care, we will increasingly see people cropping up further down the line with conditions that are much more tragic and much more difficult and expensive to treat. I ask the Secretary of State to think again about investment in public health throughout the country, not just in mental health and not just in Cumbria.

We have seen no real-terms increase in the rural element of the grant, and the lower-tier services grant has not been increased. District councils, which are much more likely to be in rural areas, are not receiving the support that they need. I do not want to see a push-and-pull and a fight between rural and urban communities—such activities are often misplaced—but it is worth pointing out that those who operate services in rural communities do so relatively inefficiently, because they are dealing with the same sort of issues but with much smaller numbers. There may be only 30 children at a school in the south lakes, for example, not because it is of poor quality and unable to recruit pupils but because only about 14 kids live in the catchment area, and 30 pupils mean that it is over-performing. In my constituency there are two high schools—secondary schools—with fewer than 200 pupils, and probably about a dozen primary schools with fewer than 60. I can think of two with fewer than 30. They have small school rolls not because they are not good schools, but because they represent vast areas of land in the Lake district and the dales. The lack of an understanding of rural needs means that the needs of those schools become greater and greater.

When it comes to funding formulas, one issue in particular concerns me. It depends on which metric we look at and whom we believe, but I do believe that Cumbria may have the worst pothole problem in the country, for one reason in particular. Ours is, I think, the second biggest county in England, and I think that therefore we have the second biggest number of roads. We have one of the smallest populations in any county—we certainly have the smallest concentrations of population anywhere in the country—and yet we have colossal numbers of visitors, 38 times more each year than the number of people who live in the county. The tourists who are so welcome in the lakes and the dales and elsewhere in Cumbria are helping to contribute to the wear and tear of our roads, but they are not contributing to the upkeep. I should like the Secretary of State to think carefully about how he can compensate rural communities like mine—particularly tourist-heavy communities—bearing it in mind that although, after London, the Lake district is the most visited place in Britain, it does not receive any compensation to help it to fund the services that are used by those visitors, which is a terrible shame.

We should bear it in mind that over a third of the increased funds available to local authorities this year is money that councils have to raise, with a £1.4 billion increase in council tax. Council tax is an unfair form of taxation: it is disproportionately paid by those on lower incomes, and it puts a greater burden on household outgoings. Combined with the national insurance rise that is coming in a few weeks’ time, this puts an additional burden on people with low and middle incomes which they cannot afford.

The increase in council tax is, broadly speaking, for social care, and no sensible council will miss the opportunity to find that money to protect its social care provision. The national insurance rise is being sold as a measure that will help social care provision, but it is not really going to do that. It will not lead to what we really need, which is an upgrade in the terms and conditions and pay for people working in social care. Without that, we will neither recruit nor retain the people we need. In Cumbria, we have seen a 32% reduction in social care beds in just six and a half years. It is deeply troubling for people to have a rise in taxation outgoings both to the local authority and nationally but to see nothing for it, and nothing that will help retain those people whom we clearly need working in social care.

One reason why we have great difficulty in meeting social care needs in Cumbria is our inability to provide places for the workforce to live, which is a major responsibility of unitary and lower-tier authorities. As the Secretary of State knows—I think he has agreed to meet me to discuss this issue—rural Britain in particular faces a massive housing crisis, which is costing us in so many different ways, and while we have had this crisis for many years, through the pandemic it has become a catastrophe.

Two things have happened. First, roughly speaking, 80% of house sales in Cumbria during the pandemic have been to the second-home market, weakening communities and leaving them with an ever smaller permanent population. That means that we lose the services. If we lose a number of kids at a school, we may lose the school as well as the bus service, the post office and what it is to have a life in a community. The other thing that has happened, since the end of the eviction ban last year, is a massive increase in people evicted from relatively affordable private rents to turn those houses into Airbnbs instead.

Hon. Members can imagine the existing number of holiday let properties in a place such as the Lake district, and in my district alone in a 12-month period last year they increased by 32%. Where did those properties come from? Ordinary families in my community have been evicted—kicked out. They may have been there for years. I think of one family who raised their kids there for 16 years and were kicked out with little notice. They had to leave the community and move their children because the Government did not scrap section 21 evictions having promised to do so. That leaves us with no staff available for care homes or all the other provision that we need. It is a moral outrage, and it practically undermines our economy.

As we look to support local government, I would love the Secretary of State to look at the ways in which he can affect that by, for instance, changing planning law so that a family home cannot be turned into a second home or a holiday let without asking the planning authorities for permission. That would keep a lid on the problem and maintain and protect the communities represented by me and others in other beautiful parts of the country. That would not cost anything—perhaps a bit more resource for planning departments for enforcement —so there is a way of adding value to our communities without necessarily spending any more money.

I have one final ask via the Secretary of State to the Chancellor of the Exchequer: why do we not consider following the Welsh Government’s lead in providing local authorities with permission to double council tax on second homes? That would be a disincentive for second homes and protect communities from too many of them. It would also create a revenue stream, which those communities could invest in supporting new affordable homes and protecting local schools that would otherwise have too few kids to be viable. I would love him to look at and think about those things. As we suffer through many other challenges such as the cost of living crisis and recovery from the pandemic, I want him to focus in particular on the housing catastrophe that affects the economy and community in so many rural areas such as mine.