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In what environment will those third sector organisations that are expected to fill the void be expected to operate? Will they be able to secure proper service level agreements and guarantees, given that councils will be under significant funding pressures throughout the current Parliament? What will be in it for them, and will they even be able to perform that rescue job when their capacity has been hit in the ways that I have described? No wonder so many of those bodies and their representatives-the National Council for Voluntary Organisations, the chairman of the Charity Commission and the chief executive of the Association of Chief Executives of Voluntary Organisations-are criticising what the Government
29 Jun 2010 : Column 823
are doing. As Stephen Bubb has said, "If politicians in government would only recognise that there is a cost to volunteering, and that charities and other third sector organisations can't simply expand their volunteering to fill the gaps."

Many charities rely on public money to function, and funding from central and local government now accounts for 36% of charities' incomes. Apparently, the Secretary of State warned Tory councillors last Friday that they might experience cuts of between 30% and 40% during the current Parliament. No wonder-again-that third sector bodies such as Age UK, and outside experts such as the King's Fund, say that the Government's actions will leave councils with almost no money with which to support people in their own homes.

What about George Osborne's other great white hope- [Interruption.] What about the Chancellor-for now-and his great white hope, the private sector? As Opposition Members have pointed out quite straightforwardly, no account has been taken of the existing dependence on public contracts. No attempt has been made to squeeze out or drop out. Many refuse contracts are already outsourced; how will those contractors cope with Comrade Pickles's latest diktat about weekly refuse collections? [Interruption.] I refer to the right hon. Gentleman the Secretary of State.

The cuts faced by local government are part of a continuum: savage public sector cuts that will have a devastating effect on local economies. They should not be viewed merely within the framework of job losses in town halls or recruitment freezes. The ability of councils to boost economic development in deprived areas has been taken away, and those in the poorest communities will suffer most. Reports from the Greater Manchester business leadership council have already shown that public sector job cuts can push retailers into relocating from towns and cities with high public sector employment.

These Budget measures will lead to 725,000 job losses up to 2015. What structural abilities will be available to sort this out, given that the Government are leaving the regional development agencies in limbo and there are no successors around? The Government need to be wary of the dangers of a squeeze on public pay. With a work force demonised and demoralised by them, where will it lead us?

Given the way in which these cuts have been made, I want to make a final point about the financial structure. [Interruption.] If the Secretary of State had been here for most of the debate, we might have taken a little more notice of what he has had to say. What I want to say is that this huge leap in the dark- [Interruption.]

Madam Deputy Speaker (Dawn Primarolo): Order. Will Members contain themselves just a bit as we approach the end of the debate so that we can hear all the contributions, as opposed to all the private conversations that are taking place?

Mr Marsden: Thank you, Madam Deputy Speaker.

This huge leap in the dark is based on the market fetishism and sado-monetarism that are practised by so many Members on the Government Benches. The Office for Budget Responsibility has shown that the Budget of
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my right hon. Friend the Member for Edinburgh South West (Mr Darling) was prudent in its estimate of the budgetary outlook.

Nadhim Zahawi: Will the hon. Gentleman give way?

Alec Shelbrooke (Elmet and Rothwell) (Con): Will the hon. Gentleman give way?

Mr Marsden: No, I will not give way.

Government budgets are not like those of individual businesses or households. Cutting Government expenditure automatically reduces the income of private businesses and households. As the well-known economic expert on local government Tony Travers has said, Britain is about to submit itself to an enormous economic experiment. But it is Government Members who are submitting people to it and it is the people we care about who are going to suffer as a result of it. It is good that so many Labour Members have talked about the human impact on individuals of cutting programmes such as connecting communities, Connexions and Positive Activities for Young People.

Local Government, as my protesting workers in Blackpool said to the council yesterday, is about connection and so-called social cohesion. Ultimately, it is about human respect and impact on individuals. While we have hollowed-out policies being put over by hollowed-out people opposite, we will not flourish. That is why we have moved this motion tonight.

9.51 pm

The Parliamentary Under-Secretary of State for Communities and Local Government (Andrew Stunell): It has been a lively debate with plenty of passionate opinions and not too many facts from those on the Opposition Benches. Thirty three hon. Members have contributed to the debate, and before I deal with as many of their points as I can, I pay tribute to the hon. Members who made maiden speeches today- the hon. Member for Wolverhampton South West (Paul Uppal), who demonstrated a light touch but also a determination to stick up for his constituents, and the hon. Member for Dudley South (Chris Kelly), who is local and proud of it; his sense of fairness, he thinks, is embedded in his constituency.

We in the Government are under no illusion that local authorities face significant challenges, but deficit reduction and continuing to ensure economic recovery is the most pressing issue facing Britain today. Given that fact, it is fair that local authorities make a contribution to that reduction in Government spending-a proportionate reduction. It will enable the Government to take immediate action to tackle the UK's unprecedented £156 billion deficit inherited from the previous Government.

Mr Betts: Will the Minister give way?

Andrew Stunell: I will give way in a moment, but let us be clear that for every £300 of income we are getting, we are spending £400 and putting the extra £100 on the credit card; £156 billion is going on the card this year, adding to £1,400,000 billion of debt. Putting that right does not guarantee recovery, but failing to put it right guarantees failure of the British economy.

29 Jun 2010 : Column 825

No local authority will face a reduction in its revenue grant of more than 2%, where councils have received final allocations. I want to nail one of the myths that came up in the debate-the idea that the other grants somehow are tilted against the north, or the inner urban areas. The housing and planning delivery grant reduction has an impact of £1.45 per head in the metropolitan boroughs. In the shire districts, which Opposition Members thought were getting a free ride, the cost is £3.10 per head. The south-east is paying 90p a head, the north-east is paying 70p a head. Opposition Members' charge is completely misplaced.

The £29 billion of formula grant-the main source of funding for local government-will be protected. There are no controls on how that money is spent in these reductions. The ring-fencing of non-schools revenue and capital funding is reduced from 10.6% to 7.7%.

Mr Blunkett: Will the Minister give way?

Andrew Stunell: I will give way in a moment, but I want to tell the right hon. Gentleman one or two facts that he has failed-

Mr Blunkett: Will the Minister give way?

Madam Deputy Speaker: Order. Mr Blunkett, the Minister is declining to give way at this point, and he says that he will give way later on.

Andrew Stunell: I shall give way in a moment, when the right hon. Gentleman has listened to this statistic. [Hon. Members: "Oh!"] Well, a few facts would not go amiss in this debate. In 1998, 4.6% of local government expenditure was ring-fenced. The previous Government put it up to 14%, and we are getting it down to 7.7%. That will give councils the freedom and flexibility that they need to concentrate on local priorities and to protect the front line.

Mr Blunkett: Will the Minister repeat the statistic that he gave on the £29 billion revenue support grant and explain how it will be protected? What will a 30% cut in that grant mean in real terms to local government over the next four years?

Andrew Stunell: My point was about the £6.2 billion of cuts that have been referred to throughout the debate. The decisions on the comprehensive spending review are not mine to reveal.

Mr Betts: During the general election campaign, the Minister said that immediate cuts were not necessary or desirable. Will he tell the House precisely on what day he changed his mind?

Andrew Stunell: About the time that, instead of simply banks failing throughout the world, countries were failing throughout the world.

We expect councils to continue to protect essential, front-line services this year. The decision on where to make the changes to their budgets is one for them to take. We have given them the flexibility that they need to deliver that, and, with local government accounting for about one quarter of United Kingdom public sector spending, the level of cuts that they are taking is
29 Jun 2010 : Column 826
proportionate. In the context of greatly reduced public finance, it is right that all parts of the public sector bear some part of that.

Like Opposition Members, I wish that this programme were unnecessary or avoidable, but unlike them I remember my right hon. Friend the Secretary of State for Business, Innovation and Skills, when he was the Liberal Democrat Treasury spokesman, warning them time and again, year after year, Budget after Budget, that they were following a path to fiscal destruction. On uncontrolled debt, unregulated banks and unfounded public spending, they would not listen then and do not want to listen now. They hollowed out Britain's economic base, mortgaged Britain's financial future, gambled on the banks and blew away our manufacturing industry, and now when the bailiffs are at the end of the street, they still want to spend, spend, spend.

It is time that the Opposition got real, faced up to their catastrophic destruction of this country's public finances, hung their heads in shame and confessed that their misplaced love affair with the casino bankers leaves this House, this Government and the British people with no choice but to tighten our belts, pick up Britain's economy and get it going again. I urge the House to support the Government's amendment.

Question put (Standing Order No. 31(2)), That the original words stand part of the Question.

The House divided: Ayes 243, Noes 335.
Division No. 12]
[9.59 pm


Ainsworth, rh Mr Bob
Alexander, rh Mr Douglas
Alexander, Heidi
Ali, Rushanara
Allen, Mr Graham
Anderson, Mr David
Austin, Ian
Bailey, Mr Adrian
Bain, Mr William
Banks, Gordon
Barron, rh Mr Kevin
Bayley, Hugh
Beckett, rh Margaret
Begg, Miss Anne
Benn, rh Hilary
Benton, Mr Joe
Berger, Luciana
Betts, Mr Clive
Blackman-Woods, Roberta
Blears, rh Hazel
Blenkinsop, Tom
Blomfield, Paul
Blunkett, rh Mr David
Bradshaw, rh Mr Ben
Brennan, Kevin
Brown, Lyn
Brown, rh Mr Nicholas
Brown, Mr Russell
Bryant, Chris
Buck, Ms Karen
Burden, Richard
Byrne, rh Mr Liam
Cairns, David
Campbell, Mr Alan
Campbell, Mr Gregory
Campbell, Mr Ronnie
Caton, Martin
Chapman, Mrs Jenny
Clark, Katy
Clarke, rh Mr Tom
Clwyd, rh Ann
Coaker, Vernon
Coffey, Ann
Connarty, Michael
Cooper, Rosie
Corbyn, Jeremy
Crausby, Mr David
Creagh, Mary
Creasy, Stella
Cruddas, Jon
Cryer, John
Cunningham, Alex
Cunningham, Mr Jim
Cunningham, Tony
Dakin, Nic
Danczuk, Simon
Darling, rh Mr Alistair
David, Mr Wayne
Davidson, Mr Ian
Davies, Geraint
De Piero, Gloria
Denham, rh Mr John
Dobbin, Jim
Dobson, rh Frank
Docherty, Thomas
Dodds, rh Mr Nigel
Donaldson, rh Mr Jeffrey M.
Donohoe, Mr Brian H.
Doran, Mr Frank
Dowd, Jim
Doyle, Gemma
Dromey, Jack
Dugher, Michael
Durkan, Mark

Eagle, Ms Angela
Eagle, Maria
Efford, Clive
Elliott, Julie
Ellman, Mrs Louise
Engel, Natascha
Esterson, Bill
Evans, Chris
Farrelly, Paul
Field, rh Mr Frank
Fitzpatrick, Jim
Flello, Robert
Flint, rh Caroline
Flynn, Paul
Fovargue, Yvonne
Francis, Dr Hywel
Gapes, Mike
Gardiner, Barry
Gilmore, Sheila
Glass, Pat
Glindon, Mrs Mary
Godsiff, Mr Roger
Goggins, rh Paul
Goodman, Helen
Greatrex, Tom
Green, Kate
Greenwood, Lilian
Griffith, Nia
Gwynne, Andrew
Hain, rh Mr Peter
Hamilton, Mr David
Hamilton, Mr Fabian
Hanson, rh Mr David
Harman, rh Ms Harriet
Harris, Mr Tom
Havard, Mr Dai
Healey, rh John
Hendrick, Mark
Hepburn, Mr Stephen
Heyes, David
Hillier, Meg
Hilling, Julie
Hodge, rh Margaret
Hodgson, Mrs Sharon
Hoey, Kate
Hopkins, Kelvin
Howarth, rh Mr George
Hunt, Tristram
Illsley, Mr Eric
Irranca-Davies, Huw
Jamieson, Cathy
Johnson, Diana R.
Jones, Graham
Jones, Helen
Jones, Mr Kevan
Jones, Susan Elan
Joyce, Eric
Keen, Alan
Kendall, Liz
Khan, rh Sadiq
Lammy, rh Mr David
Lavery, Ian
Lazarowicz, Mark
Leslie, Chris
Lewis, Mr Ivan
Lloyd, Tony
Love, Mr Andrew
Lucas, Caroline
Lucas, Ian
MacShane, rh Mr Denis
Mactaggart, Fiona
Mahmood, Mr Khalid
Mahmood, Shabana
Mann, John
Marsden, Mr Gordon
McCann, Mr Michael
McClymont, Gregg
McCrea, Dr William
McDonagh, Siobhain
McDonnell, Dr Alasdair
McDonnell, John
McFadden, rh Mr Pat
McGovern, Alison
McGuire, rh Mrs Anne
McKechin, Ann
McKinnell, Catherine
Meacher, rh Mr Michael
Meale, Mr Alan
Mearns, Ian
Michael, rh Alun
Miller, Andrew
Mitchell, Austin
Moon, Mrs Madeleine
Morden, Jessica
Morrice, Graeme
Morris, Grahame M.
Mudie, Mr George
Munn, Meg
Murphy, rh Paul
Murray, Ian
Nandy, Lisa
Nash, Pamela
O'Donnell, Fiona
Onwurah, Chi
Osborne, Sandra
Owen, Albert
Paisley, Ian
Pearce, Teresa
Perkins, Toby
Phillipson, Bridget
Pound, Stephen
Qureshi, Yasmin
Raynsford, rh Mr Nick
Reeves, Rachel
Reynolds, Emma
Reynolds, Jonathan
Riordan, Mrs Linda
Ritchie, Ms Margaret
Robertson, John
Robinson, Mr Geoffrey
Rotheram, Steve
Roy, Mr Frank
Roy, Lindsay
Ruane, Chris
Ruddock, rh Joan
Sarwar, Anas
Seabeck, Alison
Shannon, Jim
Sharma, Mr Virendra
Sheerman, Mr Barry
Sheridan, Jim
Shuker, Gavin
Simpson, David
Singh, Mr Marsha
Skinner, Mr Dennis
Slaughter, Mr Andy
Smith, Angela (Penistone and Stocksbridge)
Smith, Nick
Smith, Owen
Soulsby, Sir Peter
Spellar, rh Mr John
Stuart, Ms Gisela
Sutcliffe, Mr Gerry

Tami, Mark
Thomas, Mr Gareth
Thornberry, Emily
Timms, rh Stephen
Trickett, Jon
Turner, Karl
Twigg, Derek
Twigg, Stephen
Umunna, Mr Chuka
Vaz, rh Keith
Vaz, Valerie
Walley, Joan
Watson, Mr Tom
Watts, Mr Dave
Whitehead, Dr Alan
Wicks, rh Malcolm
Williamson, Chris
Wilson, Phil
Winnick, Mr David
Winterton, rh Ms Rosie
Wood, Mike
Woodcock, John
Woodward, rh Mr Shaun
Woolas, Mr Phil
Wright, David
Wright, Mr Iain
Tellers for the Ayes:

Kerry McCarthy and
Steve McCabe

Adams, Nigel
Afriyie, Adam
Aldous, Peter
Amess, Mr David
Andrew, Stuart
Arbuthnot, rh Mr James
Bacon, Mr Richard
Bagshawe, Ms Louise
Baker, Norman
Baker, Steve
Baldry, Tony
Baldwin, Harriett
Barclay, Stephen
Barker, Gregory
Baron, Mr John
Barwell, Gavin
Bebb, Guto
Beith, rh Sir Alan
Bellingham, Mr Henry
Benyon, Richard
Beresford, Sir Paul
Berry, Jake
Bingham, Andrew
Binley, Mr Brian
Birtwistle, Gordon
Blackman, Bob
Blackwood, Nicola
Blunt, Mr Crispin
Boles, Nick
Bone, Mr Peter
Bottomley, Peter
Bradley, Karen
Brake, Tom
Bray, Angie
Brazier, Mr Julian
Bridgen, Andrew
Brine, Mr Steve
Brokenshire, James
Brooke, Annette
Browne, Mr Jeremy
Bruce, Fiona
Bruce, rh Malcolm
Buckland, Mr Robert
Burley, Mr Aidan
Burns, Conor
Burns, Mr Simon
Burrowes, Mr David
Burstow, Mr Paul
Burt, Alistair
Burt, Lorely
Byles, Dan
Cable, rh Vince
Cairns, Alun
Campbell, rh Sir Menzies
Carmichael, Mr Alistair
Carmichael, Neil
Carswell, Mr Douglas
Cash, Mr William
Chishti, Rehman
Chope, Mr Christopher
Clappison, Mr James
Clark, rh Greg
Clifton-Brown, Geoffrey
Coffey, Dr Thérèse
Collins, Damian
Colvile, Oliver
Cox, Mr Geoffrey
Crockart, Mike
Crouch, Tracey
Davey, Mr Edward
Davies, David T. C. (Monmouth)
Davies, Glyn
Davies, Philip
Davis, rh Mr David
de Bois, Nick
Dinenage, Caroline
Djanogly, Mr Jonathan
Dorrell, rh Mr Stephen
Dorries, Nadine
Doyle-Price, Jackie
Drax, Richard
Duncan, rh Mr Alan
Duncan Smith, rh Mr Iain
Dunne, Mr Philip
Edwards, Jonathan
Ellis, Michael
Ellison, Jane
Ellwood, Mr Tobias
Elphicke, Charlie
Eustice, George
Evans, Jonathan
Evennett, Mr David
Fabricant, Michael
Fallon, Michael
Farron, Tim
Featherstone, Lynne
Field, Mr Mark
Foster, Mr Don
Francois, rh Mr Mark
Freeman, George
Freer, Mike
Fullbrook, Lorraine
Fuller, Richard
Garnier, Mr Edward
Garnier, Mark
Gauke, Mr David
Gibb, Mr Nick

Gilbert, Stephen
Gillan, rh Mrs Cheryl
Glen, John
Goldsmith, Zac
Goodwill, Mr Robert
Graham, Richard
Grant, Mrs Helen
Gray, Mr James
Grayling, rh Chris
Green, Damian
Greening, Justine
Grieve, rh Mr Dominic
Griffiths, Andrew
Gummer, Ben
Gyimah, Mr Sam
Hague, rh Mr William
Halfon, Robert
Hames, Duncan
Hammond, rh Mr Philip
Hammond, Stephen
Hancock, Matthew
Hancock, Mr Mike
Hands, Greg
Harper, Mr Mark
Harrington, Richard
Harris, Rebecca
Hart, Simon
Harvey, Nick
Haselhurst, rh Sir Alan
Hayes, Mr John
Heald, Mr Oliver
Heath, Mr David
Heaton-Harris, Chris
Hemming, John
Henderson, Gordon
Hendry, Charles
Hinds, Damian
Hoban, Mr Mark
Hollingbery, George
Hollobone, Mr Philip
Hopkins, Kris
Horwood, Martin
Howarth, Mr Gerald
Howell, John
Hughes, Simon
Huhne, rh Chris
Hunter, Mark
Huppert, Dr Julian
Hurd, Mr Nick
Jackson, Mr Stewart
James, Margot
Javid, Sajid
Jenkin, Mr Bernard
Johnson, Gareth
Johnson, Joseph
Jones, Andrew
Jones, Mr David
Jones, Mr Marcus
Kawczynski, Daniel
Kelly, Chris
Kennedy, rh Mr Charles
Kirby, Simon
Knight, rh Mr Greg
Kwarteng, Kwasi
Laing, Mrs Eleanor
Lamb, Norman
Lancaster, Mark
Lansley, rh Mr Andrew
Latham, Pauline
Leadsom, Andrea
Lee, Jessica
Lee, Dr Phillip
Leech, Mr John
Lefroy, Jeremy
Leigh, Mr Edward
Leslie, Charlotte
Letwin, rh Mr Oliver
Lewis, Brandon
Lewis, Dr Julian
Liddell-Grainger, Mr Ian
Lilley, rh Mr Peter
Lloyd, Stephen
Llwyd, Mr Elfyn
Lopresti, Jack
Lord, Jonathan
Loughton, Tim
Luff, Peter
Lumley, Karen
Macleod, Mary
Main, Mrs Anne
Maude, rh Mr Francis
May, rh Mrs Theresa
Maynard, Paul
McCartney, Jason
McCartney, Karl
McIntosh, Miss Anne
McLoughlin, rh Mr Patrick
McPartland, Stephen
McVey, Esther
Menzies, Mark
Metcalfe, Stephen
Miller, Maria
Mills, Nigel
Milton, Anne
Mitchell, rh Mr Andrew
Mordaunt, Penny
Morgan, Nicky
Morris, James
Mosley, Stephen
Mowat, David
Mulholland, Greg
Mundell, rh David
Munt, Tessa
Murray, Sheryll
Murrison, Dr Andrew
Neill, Robert
Newmark, Mr Brooks
Newton, Sarah
Nokes, Caroline
Norman, Jesse
Nuttall, Mr David
O'Brien, Mr Stephen
Offord, Mr Matthew
Ollerenshaw, Eric
Opperman, Guy
Ottaway, Richard
Parish, Neil
Patel, Priti
Paterson, rh Mr Owen
Pawsey, Mark
Penning, Mike
Penrose, John
Percy, Andrew
Perry, Claire
Phillips, Stephen
Pickles, rh Mr Eric
Pincher, Christopher
Poulter, Dr Daniel
Prisk, Mr Mark
Pritchard, Mark
Pugh, Dr John
Raab, Mr Dominic
Randall, rh Mr John
Reckless, Mark

Redwood, rh Mr John
Rees-Mogg, Jacob
Reid, Mr Alan
Rifkind, rh Sir Malcolm
Robathan, Mr Andrew
Robertson, Mr Laurence
Rogerson, Dan
Rosindell, Andrew
Rudd, Amber
Russell, Bob
Rutley, David
Sanders, Mr Adrian
Sandys, Laura
Scott, Mr Lee
Selous, Andrew
Shapps, rh Grant
Sharma, Alok
Shelbrooke, Alec
Shepherd, Mr Richard
Simmonds, Mark
Skidmore, Chris
Smith, Miss Chloe
Smith, Henry
Smith, Julian
Smith, Sir Robert
Soames, Nicholas
Soubry, Anna
Spelman, rh Mrs Caroline
Spencer, Mr Mark
Stanley, rh Sir John
Stephenson, Andrew
Stevenson, John
Stewart, Bob
Stewart, Iain
Stewart, Rory
Streeter, Mr Gary
Stride, Mel
Stuart, Mr Graham
Stunell, Andrew
Sturdy, Julian
Swales, Ian
Swayne, Mr Desmond
Swinson, Jo
Swire, Mr Hugo
Syms, Mr Robert
Tapsell, Sir Peter
Teather, Sarah
Thurso, John
Timpson, Mr Edward
Tomlinson, Justin
Tredinnick, David
Truss, Elizabeth
Turner, Mr Andrew
Tyrie, Mr Andrew
Uppal, Paul
Vaizey, Mr Edward
Vara, Mr Shailesh
Vickers, Martin
Villiers, rh Mrs Theresa
Walker, Mr Charles
Walker, Mr Robin
Wallace, Mr Ben
Walter, Mr Robert
Ward, Mr David
Watkinson, Angela
Weatherley, Mike
Webb, Steve
Wharton, James
Wheeler, Heather
White, Chris
Whittaker, Craig
Whittingdale, Mr John
Wiggin, Bill
Willetts, rh Mr David
Williams, Mr Mark
Williams, Roger
Williams, Stephen
Williamson, Gavin
Wilson, Mr Rob
Wollaston, Dr Sarah
Wright, Jeremy
Wright, Simon
Young, rh Sir George
Zahawi, Nadhim
Tellers for the Noes:

Stephen Crabb and
James Duddridge
Question accordingly negatived.
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