Local Government Finance

Wera Hobhouse Excerpts

Tuesday 5th February 2019 Commons Chamber

[Wera Hobhouse (Bath) (LD)]

The past few years have seen the deliberate and systematic destruction of local government. It is local services delivered by local councils that most people see from day to day. From bin collections to park maintenance, from library services to food safety, from highway repairs to care services, these services matter—they are a core part of our local democracy and what people experience from government. With the excuse of austerity, this Tory Government have deliberately stripped out the ability of communities to shape their local areas. Most services are now being contracted out to private companies, and the oversight of good local services is deliberately fragmented and complex.

The biggest cuts to local government are still to come and still to be felt. Councils have emptied their reserves, cut services to the bone and shed the maximum number of council staff. The consequence of all this is poor local services—a tatty public realm, non-existent youth services and unmaintained parks. Worse than that, it is homeless people on the streets, low-quality care for the elderly and limited provision for vulnerable children, especially those with mental health problems. The Government offer nothing new for children’s social care, which has seen a £1 billion shortfall.

In my constituency, 82% of Bath and North East Somerset Council’s budget is spent on adult and children’s social care. This leaves the remaining 18% to fund everything else, from waste collection to road maintenance, library services, the arts, public realm improvements and community outreach services. These services are an absolute shadow of their former selves, becoming more and more squeezed under the pressure of a growing responsibility for social care. Bath and North East Somerset Council cut 15% of its total staff last year and still has another £12 million of cuts to make to meet central Government targets. We have heard today about inequalities. I acknowledge that Bath is one of the better local councils, so I absolutely understand what councils have to face in areas that are even less well off than Bath.

What is the Liberal Democrat answer to this? It is properly funded local government. We have been talking about the revenue support grant and how it provides some fair funding across the board. The Conservative Government currently plan to completely abolish the revenue support grant, which has distributed resources fairly from richer to poorer areas, and replace it with a system where councils can substantially increase council tax and retain the business rates that they collect. These proposals are highly divisive and will starkly increase inequalities across the country. Liberal Democrats are totally committed to the fair distribution of money across all areas of the UK for the provision of good local services. Wherever people live, there should not be a postcode lottery for local services. We will replace business rates with land value taxation, which will help to protect our high streets for the long term.

Liberal Democrats propose additional higher council tax bands so that everybody, including people in high-value properties, makes a fair contribution to the public purse. I understand the argument that just adding council tax bands will not make the substantial difference, so I confirm that the revenue support grant, as one of the fairer ways of providing fair council funding, is the absolute bottom line. There must also be, after 30 years, a revaluation of property values to correctly establish the correct council tax band for every property. While we still have council tax in the mix, it has to be fair.

Finally, I will touch on devolution and democracy. It is not only local government finance that is being cut to the bone by this Government—they are also taking every opportunity that arises to weaken local democratic accountability. Every structural change in local government proposed in the past few years has been to cut out the democratic levels and to have fewer elected councillors making local decisions.

The Tory agenda is clear: weaken local government, cut its budgets to the bone, remove the checks and balances of local democracy, and pave the way for large private sector providers answering to Whitehall. Liberal Democrats have a completely different vision for local government: properly funded and properly democratic, taking decisions about local services, delivering them locally and being locally accountable. This funding settlement is woefully inadequate and I will vote against it.