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9.23 pm

Mr. Eric Illsley (Barnsley, Central): I welcome the spending review and the overall spending allocations announced by my right hon. Friend the Chancellor. I especially welcome the increased spending on education and health, which are two of the Government's priorities. In the short time available, I shall dwell briefly on those two areas.

I congratulate my right hon. Friend the Chancellor on his bold commitments and on his stewardship of the economy which, despite the current economic climate and the uncertainty in the stock exchange, has made the spending increases possible. However, my main question with regard to the spending review has to do with how money is allocated and distributed to areas such as mine. The failure of some of our distribution formulae and systems has meant that some of my constituents will not benefit from the total amount announced by the Chancellor in the review. We will continue to struggle to provide better standards of education, an improved health service and better public services administered by local government simply because the distribution mechanisms are unfair in my area. The funding mechanisms for health, local government and education are biased against my constituency and other metropolitan areas.

Areas such as mine are receiving less money for health this year than they were last year, and we must address that anomaly. In 2001–02, Barnsley health authority was funded at 98 per cent. of its target. This year, it will be funded at 97.2 per cent. of its target, so technically, the money available to my local health authority is decreasing because it is funded below that target. Unfortunately, no one has an answer to this; it is not just this Government who have consistently underfunded Barnsley health authority. There was a long period under previous Governments, especially the Tories, when the funding received was considerably less than our funding target.

In its franchise plan, the strategic health authority for South Yorkshire gives the figures for the funding targets for my local health authority. As I said, funding at 97.2 per cent. means that we are 2.92 per cent. short of our funding target. Our two neighbouring authorities, Rotherham and Doncaster, are funded at 99.8 per cent. and 99.1 per cent. Even local authorities close by get more money than we do—there is no rationale behind that funding structure.

In reply to a questions that I asked the Secretary of State for Health recently, he said that Barnsley received an uplift of something like 10 per cent. at the last funding allocation. That money is going to fund that gap between 97.2 per cent. and the 100 per cent. target. The funding gap equates to something of the order of £6 million. The 2002 settlement of 10 per cent. was generous, but my health authority has had to use the increases awarded to fund the year on year gap in health funding.

The initiatives and targets placed on my health authority make up part of the problem. It cannot meet those targets because the funding is ring-fenced and has

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to go to initiative targets when the authority needs to spend money on closing the funding gap. Simply as a consequence of the lack of funding to cover that gap, my health authority is likely to be described as a failing health authority and have restrictions imposed on it. Yet a further new target has been imposed by the comprehensive spending review to cut accident and emergency admission waiting times to no more than four hours by 2004, and other targets have been reaffirmed.

My health authority, struggling as it is, 3 per cent. short of its funding target, is still already close to meeting even the new targets that my right hon. Friend has imposed because of the effort and hard work of its staff. It is not that the health authority is badly administered but that the funding is being diverted into meeting the historical underfunding in my area. My health authority will not have the money to reach the new targets, however, because it cannot keep using scarce resources to bridge the funding gap while still trying to meet the targets imposed on it.

Why is my health authority historically funded at such a low level? Why cannot the money be made available under the distribution formula to bridge that gap to give us the funding that we require in Barnsley?

On education, I welcome the increase of 6 per cent. in overall funding and the direct payment to schools. My local authority has consistently passported the extra money on education standard spending assessments through to schools and made sure that education is a local priority. Once again, funding is largely ring-fenced in terms of education initiatives and other initiatives, whereas the other services block—for example, to provide a range of other services apart from education and social services—is squeezed, again because the distribution formula does not work for my area.

I know that the local government review has been announced, but the material issued with that review says:


My local authority requires an assessment based on its needs. It requires a distribution formula based on the needs of the area; otherwise, it will simply lose out again and again. Again I ask, why is it that my local authority can get 70 per cent. less funding than other authorities, such as Manchester, Birmingham and Liverpool? There is absolutely no reason for such a shortfall in funding.

I shall bring my remarks to an end, because unfortunately, in this short debate, some hon. Members have probably been less considerate than others in taking such a long time over their speeches. My message is that unless we get the distribution formulae correct and address historical underfunding anomalies, the welcome news of the extra money for all our public services will not be recognised by the wider public.

9.31 pm

Mr. John Bercow (Buckingham): It has been an excellent and sometimes highly charged debate, to which there have been several first-class contributions.

My starting point is simple. In the year 2005–06, the Government anticipate spending £511.4 billion; we need to know what that means. It means that the Chancellor of the Exchequer proposes to spend no less than £16,216.39

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for every second. Translated into a meaningful statistic—on the strength of the lamentable speech by the Chief Secretary to the Treasury tonight, I think that the House and people outside will want to know what it means—it means that for the 34 minutes for which the Chief Secretary to the Treasury expected us to listen to him, we were charged a bill in public expenditure of £33,081,435.60. So when 34 minutes is taken up by the Chief Secretary, that is what the Government are spending, supposedly on the public services of this country.

The central thrust of the speech by my right hon. and learned Friend the shadow Chancellor was that simply to boast about the level of expenditure without securing the detailed constructive and effective reforms of the way in which public services are delivered will not produce the results on which the people of this country depend, and which they are entitled to expect from a Government who have had two landslides and enjoy an impregnable parliamentary majority.

As my right hon. and learned Friend said on Monday 15 July, we have heard it all before; we have heard what the Government say and seen what they fail to achieve. The truth of the matter is simply stated. In 1998, the Government promised improved public services to renew Britain. In the year 2000 spending review, the Chancellor committed himself to achieve—I quote, so as not in any way to be unfair to him—service improvements, key reforms and much-needed modernisation. No amount of flannel, no amount of rhetorical verbiage, no amount of typically aggressive and meaningless posturing from the Chief Secretary can conceal the reality that in terms of the quality of services, the Government have not delivered.

It really will not do for the Chief Secretary to fail to answer the central challenge: why have the Government now decided that the Treasury itself, which is the architect and arbiter of public service agreements, cannot measure whether it has achieved its own? To bluff, to bluster and to disdain criticism, but to fail to respond to that central challenge was a searing indictment of the generally poor speech that we heard from the Chief Secretary.

Mr. Tom Harris: The hon. Gentleman is very generous in the number of times that he gives way. At the start of this debate, his right hon. and learned Friend the Member for Folkestone and Hythe (Mr. Howard), the shadow Chancellor, told the House that he could not commit a future Conservative Government to matching the spending committed by this Government because he was not confident that the reforms presented were adequate. Last Thursday, however, his hon. Friend the hon. Member for North Essex (Mr. Jenkin) not only committed a future Conservative Government to matching defence spending, but to improving on that spending. What reforms have been implemented at the Ministry of Defence that have so impressed the Conservative Front-Bench spokesman?

Mr. Bercow: Unfortunately, the hon. Gentleman has totally misunderstood and misquoted what my hon. Friend the Member for North Essex (Mr. Jenkin) said. The shadow Secretary of State for Defence has certainly not committed himself to increased resources beyond those that the Government have already pledged. The hon. Gentleman is wrong. I know the facts, I have seen the evidence, I have read the speeches and I have had the

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discussions. I know the position of my hon. Friend: it is a commitment to secure the quality of protection for the people of this country that we need. We are not pledged to increase resources but to devise a new, credible, effective and attractive alternative to Government failures for the delivery of public services. We are not prepared to be hidebound and narrow in our approach or to be restricted to the low-level terms of debate on which the Government insist.

The Government are stuck in an old-fashioned mindset, which says that all that matters is money. I am grateful to the hon. Gentleman because he spurs me to invest my speech with additional vigour. The people of this country are interested not in words but in deeds. They are interested not in inputs, but in outputs—not in promises, but in performance. When the people of this country make a judgment about the effective use of public expenditure, the question in their minds will simply be this: are we getting the three things that we want from the money that the Government spend, which we have given them in our taxes? The three things that the people of this country will tell the hon. Gentleman and the Chancellor of the Exchequer that they want are: results, results, and results.

In the past five years, the people have heard the promises, seen the spin, observed the misrepresentation and, above all, they have been disappointed by not merely the gap but the gaping chasm between the words that Ministers utter and the deeds that they do.


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