Select Committee on Transport, Local Government and the Regions Memoranda

Memorandum by Wigan Council (LGB 12)


What we support

    —  Greater Freedom for capital spending but a recognition that deprived areas face greater need and also have less ability to increase receipts.

    —  We would support the merging of NNDR and RSG.

    —  Business improvement districts are supported with the qualification that the ability to raise income is again differential.

    —  A fairer settlement for authorities such as ourselves and the recognition that we face a legacy of problems due to years of underfunding.

    —  A Full Council tax revaluation without delay and a rolling programme for further revaluations.


Capital Expenditure

  The freedoms included in part one of the bill for authorities to raise finance for capital expenditure fail to fully recognise the differential ability of authorities to do so. In order for this new freedom to operate effectively in tackling the governments wider agenda of equalising opportunity there needs to be some recognition of this fact. This could be achieved by introducing a needs element into the capital financing system which directs capital resources where they are most needed. Failure to do so will increase rather than reduce the disparities existing between areas.

Merging RSG/NNDR

  We would support the merging of these two streams as an aid to simplifying the funding mechanisms. It should be possible to maintain a visible NNDR stream using a proportion of this grant.

Business Improvement Districts

  We would support the principle of establishing business improvement districts but would maintain that there are difficulties in that certain areas will have less ability to use this income source. Wealthier areas will have the ability to improve local facilities and prosperity and there needs to be a commensurate balance in the system to counter such forces.


  In general the bill offers greater freedom for authorities which we welcome. Such freedoms are not provided equally and different authorities face differing degrees of constraint in applying such freedoms. Any new grant funding mechanism needs to recognise these shifts and direct resources to those areas who face the greatest challenges, areas of low income and limited taxbase in particular.

Council Tax Revaluation

  This council has strongly supported the regular revaluation of properties to ensure that the council tax mechanism and the consequent grant mechanism truly reflect economic and social conditions. Regular revaluations must not be delayed because of the potential turbulence that may occur or because of the difficulty of the exercise and if possible mechanisms need to be put in place, which ease the change between revaluation exercises.


  With a population of 311,967, Wigan is the eleventh largest metropolitan district in England. Historically an area based upon coal (employing at one time over 30,000 miners), textiles and heavy industry the areas employment structure has changed dramatically in the past quarter century Nevertheless the legacy of the areas industrial past remains with the borough being made up of dispersed townships based upon mining settlements, high rates of long-term limiting illness in the older age groups (17 per cent above average) and a higher proportion of the population in lower socio-economic groups (10 per cent above average). This is reflected in the fact that despite an improving employment situation Wigan is highly ranked in the DTLRs current index of multiple deprivation for local authorities.


Standard Spending Assessments
Standard spending assessments 2001-02 Secondary education SSA per pupil Total SSA per resident (excluding Police and Fire)

  The difference in SSA per head between Wigan and England is worth around £11.5 million. whilst the difference between Wigan and Manchester is around £86.7 million per year.

  Wigan has long argued that its authority has been unfairly treated in terms of the basic support it has received from government and in terms of specific measures this authority has supported changes that would improve its SSA such as

Area Cost Adjustment an extra £4.8 million a year

Reform of Additional Educational needs an extra £6.5 million a year

(1999-2000 SSA sub group options)

  Even if changes of such magnitude were introduced there is a legacy of underfunding over many years which has limited the authorities ability to implement change;

Extra resources that Wigan would have had if receiving the same SSA as neighbours since SSAs introduced in 1990/91

  Bolton  an extra £237 million SSA

  Manchester  an extra £1,119 million SSA


  The priority of the council is securing good services, in this respect the following show evidence of this commitment:

    —  Management letters.

    —  Satisfaction surveys.

    —  Performance management systems.

  At the same time there has been a range of imaginative and innovative schemes in the borough:

    —  Capital: Robin Park, town centres, private sector housing partnership, derelict land programme, Martland Park, BURA award for sustainability.

    —  Revenue: BFI, Ofsted, BV (3* and 2*), SSI, Kingsdown High project.

    —  Virtually all indicators demonstrate high performance and low cost.

    —  Mixed economy of provision in many services.

    —  Community leadership and Partnerships: well developed, operationalising, for example using health flexibilities.

    —  Works at local level too; most secondary schools have specialist status.

    —  Helped other authorities eg Liverpool.

A Council which is effective and valued by its stakeholders


  As well as the low resourcing of the authority the economic environment that the authority operates within place further limitations on the ability to achieve its objectives.

    —  Property values are low; residential £100k per acre, improved terrace house £35k, only things that have real value to cross subsidise activities are commercial leisure and retail; planning policies increasingly making this impossible

Average House prices

June 2000 to June 2001 (source: Land Registry)

    —  Specific grants slanted to city centres; this includes NRF.

    —  Little interest in most of our services from the private sector as there are not large efficiency gains to be taken for up-front investment.

    —  Even PSA rewards for achieving stretch targets are linked to current expenditure.

A sense that areas like ours don't count and can be left to struggle on because we are not an embarrassment.


What has been done to keep our head above water

    —  Made £30 million of efficiency gains since 1990.

    —  Sold most of our assets; £80 million since 1990.

    —  Council tax rises well above inflation.
Council tax increases Per cent

    —  Used any specific grants to maximum advantage

    —  Planning gain from developments to provide new facilities

    —  Unable to invest in community assets

A painful process managed to minimise the impact upon the area


    —  Diminishing returns on efficiency gains.

    —  Few assets left to sell.

    —  Must invest more in ICT and fixed assets.

    —  Five years since a change in Government and the authority is looking at big cuts and Council tax rises.

    —  Insufficient money now to provide match funding for specific grants.

    —  Planning regimes now preventing imaginative gains.

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