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There are clearly many measures that the police can take to cut back to ensure that they are making the right level of efficiency savings. If the police undertake such actions, which are documented in the HMIC report,
and if they look at the best practice that exists in police forces around the country, they can make the savings that they are being required to make without an impact on front-line services.
No Labour Member would argue with the contention that there is always scope for efficiency in public services, including the police service. My right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper) spoke about the HMIC report, as did the Minister. Our opposition to what the Government are planning is based on the sheer scale of the cuts to the police service that are set out. My additional argument, on which I will elaborate and on which I intervened on the Minister, is that there is unfairness in the allocation of those cuts as between different police forces around the country.
I should like to comment on the work that Merseyside police are doing. As in the case, I imagine, of most, if not all hon. Members on both sides of the House, crime and antisocial behaviour are consistently the biggest issues that my constituents raise with me on the doorstep, in surveys, in correspondence and at surgeries. In recent years, Merseyside police have faced some very serious challenges. Merseyside is No. 1 of any police force in the country in terms of the number of drug offences. I am therefore very concerned about the impact of cuts that are being made to the UK Border Agency, as well as cuts to local government and voluntary sector services for those with drug addiction.
In other areas, Merseyside has made truly remarkable progress in recent years. In 2005-06, it was the third highest police force in the country for violent crime, with a rate of 25.6 offences per 1,000 population. Thanks to the hard work of the police, including their work with the local community, that rate has halved over the past five years to 13 per 1,000, putting us 22nd in England, which puts it in the lower half of police forces. That is truly remarkable progress. Every indication that I have is that Merseyside police are determined to continue that progress, even in the context of the cuts that we are discussing.
Almost four years ago in what is now my constituency, there was the tragic murder of Rhys Jones. His death provided the context for a greater focus on crime, including violent crime, in Liverpool and across Merseyside. In considering the way forward for Merseyside and the fairness, or rather unfairness, of the proposed cuts, everyone in my constituency is concerned to ensure that never again do we see the tragedy of what happened to young Rhys. The police responded brilliantly and with great professionalism in that case, which resulted in serious convictions by the courts for those who murdered Rhys Jones.
Already in 2010-11, 200 police officer jobs and 80 police staff jobs are being lost in Merseyside. There is a moratorium on further recruitment, which will continue into next year. The police have estimated that by March 2012-in just over a year's time-we will have lost almost 10% of police officer posts in Merseyside. The hon.
Member for Carshalton and Wallington (Tom Brake) talked about chief constables making every effort to ensure that losing police officer posts is a last resort. I think I wrote down correctly that he said that some chief constables were treating it as their first resort. I very much doubt that that is the case in any authority. I can say with certainty that it is not the case in Merseyside, where the chief constable, whom I and other Liverpool MPs met in the House a couple of weeks ago, has made every effort to maximise efficiencies and minimise the direct impact on local people through the loss of police officers.
Andrew Gwynne (Denton and Reddish) (Lab): The hon. Member for Carshalton and Wallington (Tom Brake) spoke about inconvenient facts. Last year, the Liberal Democrats in Greater Manchester, and no doubt in Merseyside, went into the election knowing about the deficit and promising more, not fewer, police. Does my hon. Friend agree that the Liberal Democrats have a duty to apologise to our constituents for giving a false impression of what they would do in office?
Stephen Twigg: Absolutely; I concur with my hon. Friend. Of course, that is not the only promise that the Liberal Democrats made to the British people last May that they have broken. They made that promise knowing, as my hon. Friend said, what the Budget position was. It was a deeply irresponsible pledge to make.
Tom Brake: Does the hon. Gentleman not also agree that it would have been appropriate for the Labour Government to announce that the structural deficit was £12 billion higher than they led the public to believe?
Stephen Twigg: The figures were very much in the public domain. To be fair to the Conservative party, it did say that it would prioritise cuts. There is a specific issue about the Liberal Democrats having said one thing in opposition and saying the complete opposite now that they are part of the coalition Government.
Mark Tami: With the Liberal Democrats, the issue is not just about the police. I remember many Opposition days on which the Liberal Democrats argued that we were not spending enough money in a host of areas.
I intervened on the Minister to raise the question of the fairness of the distribution of the cuts. He set out the consultation process in some detail, and entirely understandably set out the forces and authorities that would lose out if there were some attempt to protect those that were more reliant on central Government funding and they had lobbied against that. I appreciate what he said about the nature of the formula and the difficulty of changing it, and clearly the cuts relate to the original formula. Unfortunately, I am not suggesting that that can be changed quickly, but I repeat what I said in my intervention: I hope that the Government will consider the matter as we move forward.
Looking at the estimated police budget figures that the Library has produced, we see that in the forthcoming financial year, 2011-12, Merseyside's estimated police budget, taking into account local revenue raising as well
as central Government funding, will be cut by 5.8% whereas Surrey's cut will be 3.7%. There is every indication that that gap will apply again in the following year and therefore have a cumulative effect.
In Merseyside, there have consistently been increases in the police authority precept over recent years. The local police authority has not thought, "We're getting all this money from central Government, so we can let our council tax payers off and freeze the precept or have only a modest increase." There have been significant increases in the amount contributed by council tax payers in Merseyside to the funding of the police. The basic reality is that on average, people in Merseyside are poorer than people in Surrey. The reason why Merseyside's local police depend more on central Government funding than others is primarily to do with deprivation. That point applies also to other authorities, and when there are cuts on the scale that we are seeing, it is a cause for great concern. To his credit, the Minister undertook earlier to consider the matter again in future. Perhaps I might ask that he meet Merseyside MPs at his early convenience to discuss those concerns.
Clearly, the cuts will have an impact on forces right across the country, but that impact will differ. When there are spending cuts on such a scale, it is incumbent on the Government to consider the unfairness of those different impacts. There is clearly a need for savings in public expenditure on the police, and HMIC has considered the matter in great detail and come up with the quoted figure of 12%. My contention today is, first, that by going so significantly above that figure, the Government will inevitably damage the police service across the country; secondly, that the effects are not fair or consistent but differ for the reasons that I have given; and thirdly, that those effects are compounded by the impact of other cuts in public spending, particularly local government cuts.
Merseyside police receives direct funding from Liverpool and other local authorities for aspects of its work on antisocial behaviour. I hope that the councils will be able to protect that funding, but I am not confident that they will be fully able to do so. On top of the cuts that we are discussing today, Liverpool's police force and others around the country will therefore lose further funding for some of the important partnership work that they do on tackling antisocial behaviour.
I urge the Government to think again, and I urge Home Office Ministers to press the Treasury to give policing and law and order the priority that the Government have given schools and the national health service. Voters-our constituents-would expect us to give the police service that priority, and I hope that in the light of today's debate, the Government will do so.
Mr Aidan Burley (Cannock Chase) (Con):
A big meeting is happening in my constituency today. The Staffordshire police authority is meeting to discuss the proposals for the future of nine police stations across the force area. In "plain speak", at some point in the future, some of those stations could close, including one in Rugeley in the heart of my constituency. Chief Constable
Mike Cunningham and the chairman of the police authority, David Pearsall, have stated that Staffordshire police have made no final decision to close any particular station in the county. Crucially, they have also said that they will close no stations unless and until alternative bases have been found within the localities concerned.
That reassessment of resources is doubtless owing in part to the Minister's announcement, and it is worth Government Members remembering that these are not cuts of choice, but cuts to correct overspending by Labour in the boom years, which has left this country with one of the biggest deficits in the world. I did not come into politics to cut police numbers, having worked with the police for many years before becoming a Member of Parliament, but the reality is that when we are spending £120 million every day just to service the interest on our debt, something has to give.
It is also worth remembering that during the election campaign, the then Home Secretary declined to guarantee police numbers or individual police stations. When the right hon. Member for Morley and Outwood (Ed Balls) was shadow Home Secretary, he agreed with Her Majesty's inspectorate of constabulary-an independent body-that £1 billion efficiency savings could be made without hitting the front line. However, I wonder whether he knew how that would have come about. When he came before the Select Committee on Home Affairs, I asked him whether he thought it would be better if the police spent more time on patrol than they spend on paperwork. He responded:
"I think that is a too simplistic question for me to give a sensible answer".
The changes in police stations in Staffordshire are not just about saving money; they are also about changing shift patterns. Proposals for briefing response teams at fewer locations from April 2011 are currently being considered. That is an independent operational matter designed to improve the briefing process of sergeants, and to improve communications and intelligence sharing. It follows from that operational decision that some of the nine stations under review may become underused. Even if that happens, it would not automatically mean that any of those stations would close.
However, it could mean Staffordshire police beginning to share buildings with partner agencies such as schools, church halls, libraries and shops. In fact, the police already share a base in Stafford with a Territorial Army recruiting base. I have opened an office in a former shop in Cannock town centre with a no-appointments-necessary culture. People can drop into the "MP help zone", as it is known locally, any time from 9 to 5, Monday to Friday, to get help with their problems. Most of my staff-three of the four people whom I employ-work in the help zone rather than down here in Westminster, helping local people who come through the door with their problems. I should like to take this opportunity to pay tribute to their important work.
Other people also use the help zone, including local charities, voluntary groups, schools and-guess what?-the police. The police use it for surgeries with local people, to organise neighbourhood watches and as a general base. Is that not the model for the future, with police in
existing locations in the community such as shops, supermarkets, MPs' offices, libraries and schools, rather than in underused old police buildings, which are increasingly expensive to run?
The nine stations under review cost £1 million a year to run. How could that money be better spent on the front line-on officers on patrol, or on specialist officers to deal with domestic violence and child protection, rather than simply on bricks and mortar? Why not look to use cheaper, more front-line locations for use by the police as a front-desk base and a home for neighbourhood officers, and release the money for more police on our streets?
I pay tribute to Staffordshire police force, which is one of the most forward-looking forces in this country. As I said earlier, it has committed to retaining all police officers in neighbourhood teams and front-line staff, rather than wedding itself to a public service housing estate. The aim of this Government is to cut bureaucracy, and to enable the police to be crime fighters, not form writers. It is not the size of the work force that counts, but how it is deployed. It is not the number of police stations in Staffordshire that matters, but keeping police embedded in the community, visible and accessible, with bases that do not cost more than they need to. Without more effective deployment, modernisation of shift patterns and improved productivity, the number of local police officers engaged in local policing can still increase, despite cuts overall.
Labour has the brass neck to criticise the police grant settlement announced today, but it was its mishandling of the economy that brought this country to the brink of bankruptcy, so that we are paying £120 million a day to service the interest on our debt. That money is going to foreign investment bankers to pay for their own police services, rather than ours. But we have brought this country back from the brink. If the exam question today is "How do we maintain a visible police presence even while we have to cut police spending?" the answer is that, with barely one 10th of the police available on the streets at any one time, we know that there is room to make them more visible, more available and more effective as crime fighters.
The years of top-down bureaucratic accountability have broken the relationship between the police and the public. The police are not responsive enough to the public, and the public do not trust enough in the police. That is not the police's fault; it is the truth of Labour's legacy. I want to take this opportunity to thank every officer in Staffordshire for everything that they do to keep us safe, day in and day out. This Government supports them, despite the dreadful economic legacy. With our reforms and their hard work and bravery, we will not let Labour's mishandling of the economy put our communities in danger.
Luciana Berger (Liverpool, Wavertree) (Lab/Co-op):
I am grateful to be called to speak in this important debate, especially as cuts in policing will impact so greatly on my constituents. We heard earlier from my hon. Friend the Member for Liverpool, West Derby (Stephen Twigg) about how Merseyside police force is
heavily reliant on funding from central Government, and I shall reiterate some of the important points that he made.
Some 82% of the force's budget comes from the formula grant. Only the City of London, Northumbria and West Midlands forces are more reliant on formula grant funding. Can the Minister explain to the people of Liverpool why the real-terms percentage cut facing Merseyside in the 2011-12 financial year is 5.8%, while Surrey- which receives only 51% of its funding from central Government-is receiving a cut of just 3.7% in real terms?
"The priority is...helping police officers working on the front line."
Merseyside police chief constable, Jon Murphy, has said that his force is doing, and will do, everything it can to maintain frontline policing. In fact, since 2004 Merseyside police have made maximising police numbers on the streets a priority. As a result of rigorous efficiency savings, which have been recognised nationally by the Department, and reinvestment in frontline policing, Merseyside police have increased police numbers by hundreds of officers. But we are very concerned that the Government have made no allowances for the extensive efficiency savings already made, before cutting the formula grant so harshly. It will now be impossible to maintain front-line police levels when Merseyside police will see real-terms funding cuts of 7% in 2011-12 and 8.8% in 2012-13.
Merseyside police are having to cut 200 police officers and 80 police staff by March of this year. In addition, a moratorium on police recruitment is continuing until 2012, and this will result in roughly another 200 police officers going in that financial year. That means that Merseyside police will lose close to 10% of its police officers by March 2012. Tough choices have already had to be made, including the closure of the dedicated antisocial behaviour unit.
To substantiate those savage cuts, the Policing Minster has said that there is no simple link between police numbers and crime levels. However, I would like to bring to his attention a number of studies that contradict that. A study of crime rates and police numbers across Europe published on 7 January by the think-tank Civitas-I mention Civitas because it is a think-tank that the Government are normally inclined to listen to-suggests that there is indeed a clear link. Using the most recent data from the "European Sourcebook of Crime and Criminal Justice Statistics", Civitas compared the number of police officers per 100,000 of the population and recorded offences per 100,000 of the population. Civitas said that the data suggest
"an association between police officers per head of population and crimes per head. A nation with a larger proportion of police officers is somewhat more likely to have a lower crime rate. A nation with fewer police is more likely to have a higher crime rate."
"police numbers and resources are far from the only contributor to police effectiveness"?
Luciana Berger: Having spent a lot of time meeting the Merseyside police authority, I know that the vast proportion of its funding is taken up by staffing costs, which are a massive element. I accept that other factors can contribute to efficiency savings, but when such a high proportion of the funding goes on staffing, there are only so many efficiency savings that can be made. Indeed, a number of other studies have confirmed the link. A study published in The British Journal of Criminology in 1999, a 2005 study by the university of Cambridge and, more recently, a study last year by the university of Birmingham all evidenced the link between higher policing levels and lower crime rates. Civitas concluded by saying:
"Members of the public are at greater risk of crime in the coming year."
I know that it is not just academics who are deeply concerned about the effect that the cuts will have, because my constituents have told me that they are, too. I recently conducted a survey in my constituency, and was astounded by the number of responses that I received-more than 800. Some 77% of those respondents told me that they were concerned about the effect that a reduction in police numbers would have on the policing of their neighbourhoods. The Minister might not see a simple link between the cuts and people's safety in their communities, but I do, and most importantly, so do my constituents. It is time the Minister came clean and admitted what we all know: that these reckless cuts will take police off our streets and make our communities less safe. I urge him to think again.
Mr David Ruffley (Bury St Edmunds) (Con): It is worth reminding ourselves and the right hon. Member for Normanton, Pontefract and Castleford (Yvette Cooper)-after her, if I may say so, commendably feisty speech-that public spending constraint in this country is inevitable, because of record debt and record peacetime borrowing. The police services of this country cannot be exempt from the tough decisions that the Government make. Frankly, a Government who did not make those decisions would not be worthy of the name.
The police grant report before us shows that central Government funding for policing will fall by 20% in real terms by 2014-15. If the precept rises that are forecast in the Office for Budget Responsibility report to 2014-15 take effect-we have no reason to think that they will not-the real-terms cut will be 14%. In considering those stark figures, we should also have regard to two statistics. The first is that there was a 5% increase in police numbers between 2004 and 2009. In 2004, when there were 5% fewer police officers, I do not recall the world or the ceiling caving in.
We also know that police services in this country since 1997 have been incredibly well resourced. I must pay a debt of honour to the hon. Member for Gedling (Vernon Coaker), who was my opposite number when I was the shadow policing Minister. He was part of a Labour Home Office that invested in the police service over the years, and from 1997 there was a 20% real-terms increase in policing. I do not recall our ever voting against those measures on police grants. So let us recall that a huge amount of money has been put into the police service in recent times.
I should like to place on record what the Suffolk police authority is receiving this year, compared with previous years. The Home Office principal formula police grant in 2008-09 was £40.2 million. In 2009-10, it was £41.5 million. The figure for 2010-11 is £42.8 million, and for 2011-12, the first year of this grant settlement, it is £45.9 million. It is forecast to fall in 2012-13 to £42.8 million for the county of Suffolk. The total formula grant, which includes moneys from the Department for Communities and Local Government settlement, was £69.2 million in 2008-09, rising to £71 million in 2009-10, to £72.7 million in 2010-11 and to £73.2 million in 2011-12. The total formula grant for policing in the county of Suffolk will fall to £68.3 million in 2012-13.
I will meet the Chief Constable of Suffolk, Simon Ash, shortly to discuss how those numbers will impact on policing on the ground. Here, today, we need to ask ourselves what Ministers are going to be able to do to ensure that these funding constraints do not undermine crime prevention and detection. In short, how will law-abiding citizens be kept safe from crime and from the fear of crime? The answer must be that the police will have to more with less, and there should be scope for that.
Again, I pay tribute to the previous Labour Government to the extent that they managed to increase the number of police posts to 147,000-a record in this country's history. Sadly, however, they did not ensure that those officers spent more time on patrol. I will not repeat the statistic from Her Majesty's inspectorate of constabulary that the right hon. Member for Normanton, Pontefract and Castleford used earlier. Instead, I will use one that the hon. Member for Gedling gave me when I was shadowing him. He told me that patrol officers themselves-not all police officers, and not CID-spent an average of 14% of their time on patrol. That was the statistic at the time of the last general election. Most of my constituents would find that not only utterly unbelievable but utterly unacceptable.
I am not going to lay the blame for that on the previous Labour Administration. The problem of police bureaucracy has been going on for a lot longer than that. This bureaucratic mindset is certainly not the fault of police officers, who, in my experience, especially of Suffolk constabulary, are professionals dedicated to protecting the public from harm. It is the fault of the many-headed hydra of bureaucracy, with its so-called police "doctrine", paperwork, process and systems, that has been building up over decades. It embeds a risk-averse culture, and it stifles any can-do approach in policing.
Bureaucracy is wasting police time. I contend that, if we are to ask the police to do more with less, we have to take an axe to the bureaucracy and mean it. Unfortunately, under successive Governments of both political stripes, Ministers have too often reached for the political rhetoric of "a bonfire of regulations" and so forth. Rarely has that rhetoric been followed up with tough ministerial action to repeal unnecessary secondary legislation and unnecessary primary legislation to allow the police to get on with the job.
If we are to ask the police to do more with less, it seems incumbent on the Government of the day to reduce the burden on ordinary, hard-working police constables-an issue that has implications for the police officer numbers debate. Commenting recently on the spending reductions that were in prospect under the previous
Government as much as they are under the present one, Chief Superintendent Steve Hartley of the Bolton force in Lancashire said:
"We have got to be clear-success isn't just founded on numbers. It's how we use people. This is not just about cuts. It's about how we get our officers in the right places at the right time for the right reasons."
As my hon. Friend the Member for Cannock Chase (Mr Burley) suggested, counting the number of police officers in uniform is not a realistic measure, in the current climate, of what constitutes good and effective law and order, or good and effective policing. Surely, as a matter of logic-I have a great deal of respect for the right hon. Member for Normanton, Pontefract and Castleford, who is an extremely bright parliamentarian and understands numbers-it is not beyond the wit of man or all of us in the House to understand that what counts is the number of visible police hours delivered by a constabulary, not just the uniformed officers it has. If one hour out of every seven of a patrol officer's time is spent on patrol, surely we can agree that, in principle, that one hour could be increased to two, three or even four hours if we cut the bureaucracy on the police.
The role of Ministers comes into play here. That bureaucracy cannot be cut by the Police Federation or by the Association of Chief Police Officers, and it certainly cannot be cut by the police constable on the street. It has to come from the top. Bureaucracy reduction must come, in the first instance, from policing Ministers.
Since the general election, I have heard that 800,000 police hours have been saved by the current Government as a result of the abolition of the stop and account form and the streamlining of stop-and-search procedures. That is a paltry amount if we realise that there are more than 147,000 police officers-we have got to do better than that. I would be grateful if the Minister for Policing and Criminal Justice set my mind at rest on this point in his concluding speech.
Two reports by Jan Berry were commissioned by the previous Labour Government-quite sensibly, as she is a well-respected and intelligent former chair of the Police Federation, which had representation on her working body, as did ACPO, members of the public, clever civil servants and others. The task was to produce a list of measures to reduce bureaucracy and red tape on our hard-working, front-line police officers. I would like to rattle through some of the bigger ticket items that struck me as important, on which I believe we should take action. I am citing from the list of conclusions in the final report produced by her reducing bureaucracy taskforce, which said:
"Consider evaluation of the Modernising Charging Pilots with a view to rolling out improved arrangements where charging decisions are taken by the appropriate person according to the complexity and seriousness of offence."
My right hon. Friend the Minister has done some work on that, as indeed have I. The idea was that we should look again at the statutory charging regime that the previous Government introduced in 2004, and establish whether a charging sergeant could charge people with more offences in the "triable either way" category without the need for an automatic reference to the Crown Prosecution Service beforehand.
It is a thorny issue. We can see the logic behind the introduction of statutory charging-it was intended to reduce the number of cracked trials and discontinuances, which were extremely expensive for the Courts Service and for Government generally-but there is a definite sense that it has reduced the rapidity with which charging sergeants in custody suites can charge someone who is pretty likely to plead guilty, having been caught red-handed. We do not need sergeants in custody suites hanging around waiting for the CPS. All too few police stations have a CPS lawyer on site to give a quick and simple instruction or approval to the sergeant in question; most do not benefit from that luxury.
The second suggestion by Jan Berry's team that struck me, because I have some experience of it as well, was that we should remove the requirement to complete disclosure schedules-which must be written out laboriously by uniformed officers because that is what is provided by the relevant primary legislation, although we all know that they must be checked by the CPS eventually in any case-prior to first hearing in the magistrates court. It was also suggested that we should consider shifting the trigger point for more serious offences in the Crown court to the point at which a not guilty plea is entered.
Another hardy annual is, of course, the Regulation of Investigatory Powers Act 2000- "the grim RIPA", as it is sometimes called-and the way in which it is applied to relatively routine direct surveillance operations. For instance, a police constable may wish to carry out surveillance of a supermarket car park because he has reasonable grounds for believing that a great deal of breaking and entering is taking place. Some police forces, amazingly-although not all-interpret the RIPA guidance and the statutory codes as meaning that a constable must obtain a RIPA written authorisation from his superiors, which can be extremely time-consuming, before he can go to the car park and hide behind a wall to see whether any villains are going to start breaking into cars. We must do something about that kind of ridiculous approach to applying RIPA and observing the statutory codes. One option would be to rewrite the codes. The hon. Member for Gedling said that he was interested in that option. I hope that my right hon. Friend the Minister can confirm that action is being taken in regard to RIPA and similar procedures.
Let us talk about this. Let us tell the police officers on the ground what we are doing for them: what the House of Commons is doing to cut the nonsensical amount of bureaucracy under which they labour. They have had enough, the public have had enough, I have had enough, and I am sure that the Minister has had enough-not of what I am saying, but of the ridiculous, endless use of rhetoric and the absence of action. Let us see the Home Office get a grip.
The next issue that I want to raise has been discussed with me by the esteemed Chair of the Home Affairs Committee, the right hon. Member for Leicester East (Keith Vaz). At the beginning of 2009, there were four pilot schemes in Leicestershire, the west midlands, Staffordshire and Surrey. I do not want to be too "anoraky" about the subject, but the gist of the objective was to slim down the crime and incident recording part of the duty of a police officer who arrests someone for, say, shoplifting in a store. Could not the information simply be written on a side of A4, or the equivalent on a
hand-held device? It would be useful to know whether those pilots have been rolled out to every single police force in the country; and, if not, what powers does the Minister have to ensure that that is done? On many occasions, I have been wearily told that this is a matter for chief constables. The time has come for a bit of centralisation that works, in order to ensure that police forces adopt sensible common-sense procedures to reduce bureaucracy.
One key element of reducing bureaucracy and saving police time-so that officers can spend more time on patrol, apart from anything else-is getting rid of the double or treble keying of information. That is the phenomenon by which sometimes a single piece of information, such as a suspect's address, name or date of birth, has to be keyed into different forms even if they are online because of the incompatibility of certain IT systems. It is all very easy to say, "Well, let's just get better IT," but the fact is that this is a very difficult and complicated issue. There are also huge resource implications in junking legacy systems, and although having one national computer system might speed things up in theory, it is not really an idea of this world. I would be grateful if the Minister gave a short answer to the question of what we are doing about having a national set of police forms available on one IT platform.
Reducing bureaucracy is the most important thing this House and Government can do to ensure the money set out in this grant goes further and is spent in a smarter way. But there is another area that should also be addressed: the general efficiency agenda, which my right hon. Friend the Minister spoke about so compellingly and, I know, from a deep well of knowledge. I just want to strike a note of caution. Having worked in the Treasury under my right hon. and learned Friend the Member for Rushcliffe (Mr Clarke) and having also done the policing job as a shadow Minister in the previous Parliament, I got rather tired of the alphabet soup of consultants from PWC, KPMG and Deloitte who would regularly-and for huge sums of money, so far as I could work out-pile into a constabulary, do a report stating the mind-numbingly obvious about how the police could speed things up, and then promptly decamp. The police might follow the recommended procedures for a year or two, but the lessons they had been taught by these highly paid consultants were often forgotten, and even if not forgotten were not able to deliver the serious efficiency gains of the magnitude my right hon. Friend the Minister is talking about in the context of this settlement. We need smarter procurement, shared back-office services and, most importantly, mandated collaboration.
In concluding, I want to ask the Minister two final questions that are key to those of us who want this police grant to represent value for money so we get the most bang for our buck. First, I echo a point made by my hon. Friend the Member for Harlow (Robert Halfon) about police authorities and chief constables needing to do the right thing by getting on with collaborating to save money and to squeeze efficiencies out of their budgets. In my experience-and history tells us this, too-the likelihood is that they are not going to do that if left to do so on an ad hoc basis. Therefore, when the Minister starts mandating, will he also consider imposing financial penalties on police authorities that do not mandate and do not deliver police efficiencies?
My final and most important plea is this: if we are to be taken seriously as a Government who are keen to achieve our goals, for public interest reasons and because we want the police to spend more time on patrol and less time behind their desks, we have to show that we are serious about tackling bureaucracy. Will the Minister undertake to produce an annual report to Parliament setting out the procedures, forms and processes he has abolished with an estimate by each item of the number of police hours saved as a result of those cuts in bureaucracy? I hope that my right hon. Friend will take the opportunity to use mandated collaboration and attach penalties to it, and to make a report to Parliament telling us how many police hours he has saved each year he has been the Minister, and I hope he is the Minister for a very long time.
Keith Vaz (Leicester East) (Lab): It is always a pleasure to follow the hon. Member for Bury St Edmunds (Mr Ruffley), and given the risk of having the hon. Member for Lichfield (Michael Fabricant) make throat-cutting signs at me, as well, I will try to be as brief as possible. We started off talking about police cuts, but I think we will soon have cuts to this debate. We have heard excellent speeches and I am sure that the House, eager to get on to the next business, will not want me to detain it for too long on this subject.
This is a very important subject, however, and I want to pay tribute to the hon. Member for Bury St Edmunds, who made a thoughtful and eloquent speech. It was right for him to praise the work of the previous Government, in particular my hon. Friend the Member for Gedling (Vernon Coaker), and the fact that there was such investment in the police service. He was right to praise them for the amount of money they spent, which has resulted, of course, as he then told us, in the economic problem that is affecting the country, and the need, in this Government's view, to try to cut that expenditure.
What was important about the speech of the hon. Member for Bury St Edmunds is that he concentrated on the bread-and-butter issues that sometimes elude us when we discuss these matters in the House. Front-Benchers are rightly concerned about numbers; indeed, the police grant debate is getting very much like a debate on immigration, in which Front-Benchers rightly concentrate on numbers. However, to the public, the real issue is, how does this affect them in their constituencies? How does it affect the local police force? Are they going to get less of a service than they had before the suggested changes?
The hon. Member for Cannock Chase (Mr Burley), whom we in the Home Affairs Select Committee greatly miss, has his own version of dealing with these cuts. He has set up a help zone, so if anyone needs a policeman, they do not necessarily have to go to the local police station; they can visit the hon. Gentleman's staff. I am glad he paid tribute to his staff, because the number of calls they get will probably increase as a result of his contribution today.
Chief constables have rightly taken up the challenge set by this Government, and their tone has changed enormously since the proposals were announced. Certainly, the tone of the chief constable of Manchester, in his
latest press release of 9 February, is quite different from the one he adopted before, when he lamented the number of police officers who would be taken off his payroll. Now he is saying that he welcomes the need for collaboration; indeed, I think he said in the final sentence of his press release that he was "upbeat" about the cuts. Of course, that contrasts with what he has said before, and certainly contrasts with the quotes given to this House by my right hon. Friend the Member for Salford and Eccles (Hazel Blears), who has quoted other chief constables who are very concerned. I am not sure whether it is because one chief constable is starting off their career and another is ending theirs; but the fact is that they are in a very difficult position.
The Minister is going to have to accept that, during his term as Minister for Policing and Criminal Justice-the Select Committee has always found him extremely helpful and courteous in providing us with information-there are going to be fewer police officers. It is difficult for him to say that, and certainly difficult for someone like me, who, in debates such as this in 23 years in this House, has always expected Conservative Ministers and shadow Ministers-and, indeed, Liberal Democrats-to ask for more police officers, rather than fewer. However, fewer officers is the inevitable consequence, and whether the figure is the 10,000 talked about by my right hon. Friend the Member for Normanton, Pontefract and Castleford (Yvette Cooper), the smaller figure mentioned by the Government-we do not have a precise figure from them-or the 20,000 referred to by the Police Federation, the fact is there will be fewer police officers.
Mr Campbell: As if I would. My right hon. Friend talks about the work of his Committee. The Minister said that although the damping mechanism was applied this time, it may not be in the future, at a cost of a further £30 million of cuts to Northumbria police in the future. Will my right hon. Friend undertake to seek to work very closely with the Government should those changes to that formula and mechanism ever come to fruition?
Keith Vaz: The Select Committee is always keen to work with the Government. I do not wish to prejudge the report on police finances that we will be publishing in a fortnight's time. The Minister gave good evidence to the Committee, providing some interesting figures, and the House will have to wait for that report to see what members of the Committee have had to say.
The Minister is right to focus on procurement. He is also right to say that 80% of the budget relates to staffing, but that does not mean that we should not examine the issue of procurement. The hon. Member for Harlow (Robert Halfon), who is not in his place, talked about this issue, and Essex and Kent police, along with other police authorities, are working together.
One of the real questions for the previous Government is why we had 13 years of record expenditure but perhaps not the challenges that ought to have been made by Ministers about how the money was spent-that is not a criticism of my hon. Friend the Member for Gedling. I am not saying that the money was misspent, but it is important to examine what happened to that expenditure.
The hon. Member for Bury St Edmunds discussed bureaucracy. I think that he will find agreement on that issue across the whole House but, as he said, we tend to talk about these things but what really matters is implementation. That brings me to my third and penultimate point, which relates to the new landscape of policing. I say to the Minister that we do not yet have a narrative on crime and crime reduction from this Government. We have had some ambitious plans. The Select Committee has never worked so hard to keep up with the number of changes that the Government are envisaging, first with the police and crime commissioners, then with changes on police financing and then on the new landscape of policing. However, we needed to have some kind of a template before we embarked on those major changes.
We know that the Government want to abolish the Serious Organised Crime Agency and that the National Policing Improvement Agency is going to go, but it should have been up to the NPIA to give leadership to local police forces on procurement. What is going to happen now? It seems that individual forces will be charged for access to the databases of the new national crime agency. What worries me about the budget is that that has not been factored in. It is vital that we know what extra charges will fall on local police forces as a result of the creation of the national crime agency.
My final point is that whatever budgets a local police authority puts in place, a police and crime commissioner will be elected. As the House knows, the previous Government changed their position on the election of members of police authorities. Now that the Government have decided that this is what they want to do, people should allow police and crime commissioners the opportunity to manage the local police force. However, they will be inheriting a budget that has been set by a previous police authority, and the demands from the newly elected police and crime commissioners for more police officers will be much more important to the Government than even the demands from Labour Members.
So there is still much work to be done on the landscape of policing and I do not think we can accept the current situation as being the end. Many right hon. and hon. Members, including some from Liverpool and Staffordshire, and the hon. Members for Carshalton and Wallington (Tom Brake) and for Bury St Edmunds, have pointed out that there will be fewer officers, and that does mean a reduction in service. How local police forces deal with that depends on the leadership of Ministers, which I hope will be forthcoming.
With the leave of the House, I shall respond briefly to the points that hon. Members have made. First, I have listened to the points made by the hon. Members for Liverpool, Wavertree (Luciana Berger)
and for Liverpool, West Derby (Stephen Twigg) and I understand the implications for forces that raise less money from local council tax payers. I have explained why the decision we took was fair, I have said that we will continue to discuss these issues and the impacts on forces, and I am happy to have a meeting.
I always pay attention to the views of the right hon. Member for Leicester East (Keith Vaz), who chairs the Select Committee on Home Affairs. I believe we have set out in clear terms how the police landscape must change, but his remarks will no doubt move me to make a further speech on the issue, a copy of which I will of course send to him, to clarify the position. I draw his and the House's attention to the speech I gave to the City Forum two weeks ago when I set out in terms how the savings that we need to achieve could be made.
I commend the speeches of my hon. Friends, particularly that of my hon. Friend the Member for Bury St Edmunds (Mr Ruffley), who admonished the House about the drive to reduce bureaucracy. I took every word he said seriously. The Government will say more about this and we are driving this issue, as is the leadership of the police service. We have made progress but there is more to do. I shall write to my hon. Friend regarding his additional points about how we should secure the very important reductions in the bureaucratic burden on the police.
I particularly welcomed the speeches of my hon. Friends the Members for Cannock Chase (Mr Burley) and for Carshalton and Wallington (Tom Brake), who has had to leave the Chamber. They focused on how resources are deployed rather than just on the amount of money.
Both sides, including the Opposition, admit that police funding has to be cut, so both sides must recognise that that must mean the overall police work force will fall. What is totally disreputable about the Opposition's attack is that they would cut funding and they know that that would mean a smaller work force, but they still mounted that political attack. The public will see through it. In dismissing the finding in the HMIC report that police availability and visibility is too low, the right hon. Member for Normanton, Pontefract and Castleford (Yvette Cooper) shows that she is new to the job and has homework to do. The report says:
"The fact is that general availability, in which we include neighbourhood policing and response, is relatively low."
Yvette Cooper: Will the Minister withdraw his claim that the 11% figure was entirely due to Labour's red tape, as opposed to the fact that some police officers are on night shift or late shift and that some of them are doing work on the drugs force, organised crime and a whole series of other things that are not included in that 11%?
"Several factors have combined to produce this 'thin blue line' of which shift patterns, risk management, bureaucracy and specialisation are the most significant."
Yvette Cooper: On that point, will the Minister look again at the answer he gave to my hon. Friend the Member for Gedling (Vernon Coaker), in which he said the figure was because of Labour's red tape, and will he withdraw it?
Nick Herbert: It is, in part, because of Labour's red tape that visibility is too low. The right hon. Lady should understand that and should not dismiss the inspectorate's report. The situation could be improved by dealing with all these issues.
That the Police Grant Report (England and Wales) for 2011-12 (House of Commons Paper No. 771), which was laid before this House on 31 January, be approved .
That the Local Government Finance Report (England) 2011-12 (House of Commons Paper No. 748), which was laid before this House on 31 January, be approved.
That the Limitation of Council Tax and Precepts (Alternative Notional Amounts) Report (England) 2011-12 (House of Commons Paper No. 774), which was laid before this House on 31 January, be approved.
Mr Pickles: Over recent weeks, my coalition colleagues and I have had many conversations with local government. We have spoken to individual authorities, the Local Government Association, London Councils and other representatives, and let me say how much I respect the mature and responsible attitude that all have taken throughout those discussions. They know that we are sailing in choppy economic waters, and that cutting Labour's massive budget deficit is the responsible and the right thing to do-and many have planned ahead.
Only the most blinkered could have failed to see tough times coming. The House will recall that the right hon. Member for Edinburgh South West (Mr Darling) said in March 2010 that if Labour were to remain in power we would see spending cuts "deeper and tougher" than those of the 1980s-I suppose that that is one Labour pledge we are able to deliver-so let us not pretend that anyone thought that we could spend, spend, spend indefinitely.
Tony Lloyd (Manchester Central) (Lab): Even if the Secretary of State sets the context in terms of a cuts agenda for local government, why have this Government chosen to hit most harshly local authorities such as my own, the fourth most deprived in the country, while not inflicting the same level of cuts on authorities that are politically from a coalition background and socially in a much more advantaged position?
Thanks to Labour, the nation's credit card is maxed out. The longer we leave it before we start to pay it off, the worse it will be and the more we will have to pay. Unless we tackle Labour's borrowing, interest-just the interest-on its toxic legacy of debt will hit £70 billion a year by 2014-15. That is more than we currently raise from council tax, business tax, stamp duty and inheritance tax combined.
Mr David Blunkett (Sheffield, Brightside and Hillsborough) (Lab): The Secretary of State mentions the business rate. Could he tell the House how much, in billions, the Treasury contribution will be in the coming year over and above the yield from the business rate, which has to be redistributed to local government in any case?
Mr Pickles: Last time we discussed this, the hon. Gentleman made some interesting suggestions about the level of the business rate with regard to the surplus. I am happy to confirm to him what I said last time: that the process of distribution from the Government is based largely on the uniform business rate, and any surplus- [ Interruption. ] The hon. Gentleman needs to understand that the settlement is made within a defined period and that business rate income goes up and down. The Treasury puts money in and takes money out according to the buoyancy of the business rate. The hon. Gentleman is a distinguished Member of the House who is very familiar with these matters, and he should know these things.
Mr Pickles: The hon. Gentleman is quite right to correct me; I beg the right hon. Gentleman's pardon. He is indeed a very distinguished gentleman, and of course he knows a lot more than a lot of people in this House, including, I suspect, the hon. Gentleman. [Hon. Members: "Hear, hear!"] It is obvious from my hon. Friends' reaction that I do not need to put that to a vote.
The phasing of the settlement will be challenging. Councils can choose how they respond. Some have chosen to wring their hands and say that it is all too hard, or to play politics with front-line services. Others have chosen to step up and to protect vital local services, reducing every trace of waste, protecting the most vulnerable and reforming services to deliver better results for less.
Hammersmith and Fulham, Kensington and Chelsea and Westminster councils are merging their back offices to save £35 million. West Norfolk is freezing council tax and car park charges, as well as councillors' allowances. Reading borough council has decided not to cut but to increase funding for voluntary groups. We have heard today that Ribble Valley borough council has also decided to protect voluntary groups and not to cut front-line services.
I am grateful that many councils have brought the same constructive attitude to discussions about the funding settlement. They have helped us to put the finishing touches to a settlement that is sustainable, fair and progressive. We have focused resources on the most vulnerable communities. We have given more importance to the levels of need within each council. We have grouped councils in four bands. The most dependent on Government funding are seeing proportionately lower falls in grant. The more deprived places will receive far more funding per head than the better-off places. For
example, Hackney will receive £1,043 per head and Wokingham will receive just £125 per head. These changes have made the system fairer and more progressive than ever.
Hazel Blears: The Secretary of State knows that I have raised the issue of business rates in this House on a number of occasions. To pursue the point made by my right hon. Friend the Member for Sheffield, Brightside and Hillsborough (Mr Blunkett), the Office for Budget Responsibility has forecast that the business rate take will be £24.9 billion for 2010-11 and £26 billion for 2011-12. The Secretary of State has distributed £3.5 billion less in 2010-11 and will distribute £7 billion less in 2011-12. Is he saying that the OBR forecasts are out of sync by £3.5 billion and £7 billion? Surely the rising trend in business rates means that there is more money in the pot. If he distributed more money, we would not have to have the cuts that we face.
Mr Pickles: I am most grateful to the right hon. Lady. What she needs to understand is that two figures have been suggested-one by the Office for Budget Responsibility. Following those figures, we decided to move some things from ring-fenced grants into the general grant. That accounts for the difference between the two sizes. With regard to the level of potential surplus, there is a possible notional surplus in 2013 and 2014. As I explained to the right hon. Member for Sheffield, Brightside and Hillsborough (Mr Blunkett), what happens is that within the total sum available for grant, if there is a surplus, all is redistributed. However, as happened under the right hon. Lady's Government and under previous Governments, the amount in the revenue support grant is reduced on a compensatory basis, because the level of the total settlement is fixed. There is no difference; it is just a different way of calculating.
Ian Austin: I am very grateful to the Secretary of State. Nobody disputes that savings have to be made by local authorities. [ Interruption. ] Well, nobody does. The Government cannot have it both ways. On the one hand, they say that we were planning cuts slightly smaller than those that they are imposing, and on the other they say that we were not planning any cuts at all. I am not sure what their argument is.
On the sorts of cuts that local authorities are making, is the Secretary of State aware that the axe hangs over Dudley's benefits shop, which is helping people who have been made redundant during the recession and hard-pressed home owners who face the risk of repossession to sort out their finances? It seems an utterly ludicrous decision when it costs £300,000 a year to run and brings £2 million into the local economy, of which £1.5 million is spent on supporting local businesses. In the light of what he said about local authorities making inappropriate cuts that target the most vulnerable, will he join me in pleading with Dudley council not to close the benefits advice shop?
I feel a certain degree of camaraderie and fraternal friendship with the hon. Gentleman, because unlike his party's Front Benchers, he has said that Labour's cuts would have been just slightly less than
those that we are presenting. I think that is probably true, but the challenge facing local government means that just a couple of million quid would not make all the difference. There are very challenging circumstances.
Let us consider a number of local authorities. Some have been talking about thousands of redundancies. I do not want to appear partisan, but Sheffield is talking about 250. Sunderland, a Labour council, is not planning percentage cuts in its Supporting People provision. Walsall is not planning to make an overall cut in its voluntary sector funding. It is possible to deal with the situation.
The hon. Member for Dudley North has to understand that these are local decisions. We have ensured that there are sufficient funds to protect the vulnerable, but ultimately local councils have to make local decisions.
Charlie Elphicke (Dover) (Con): Does the Secretary of State agree that we are hearing a confused argument from the Opposition, but that it seems to involve a spending commitment of about £7 billion? That money would surely have to be made up through about 2p on income tax, would it not?
Mr Pickles: My hon. Friend is of course perfectly right. The Opposition seem to think that it is magic money, but it would actually come out of people's pockets through business rates or income tax. The reason why we are in this position is that the guilty people on the Labour Benches allowed things to get out of hand.
Mr Mark Field (Cities of London and Westminster) (Con): Will my right hon. Friend go into some detail for the benefit of the House about his commitment to the vulnerable through the transition grant allocations? I have had a cursory look at them, and they seem reasonably generous and seem to take account of the need to look after some of the most vulnerable parts of the country.
Mr Pickles: We have done three significant things. First, we moved the relative needs threshold to 83% from 73%, which makes a considerable difference and is far more than the Labour Government ever offered poorer communities. We then divided up authorities based on their level of funding, from the most dependent on grant to the least dependent, and ensured that the most dependent received smaller cuts. Then we managed to find an additional transitional amount to ensure that no authority loses more than 8.9%. I will have a further announcement to make about that.
My constituents do not want the House to make politics of what is happening. Everybody understands the situation that we are in respect of the cuts as a whole, but in areas such as Stoke-on-Trent, where we have deprivation and people out of work, we
have made representations to the Secretary of State and his Ministers to say that we want time: we want time to plan how we can keep what is most important. This finance settlement gives us no encouragement whatever that this is anything other than the Government blaming local councils for what is happening.
Mr Pickles: The hon. Lady and her councils were given quite a lot of time. The former Chancellor, the right hon. Member for Edinburgh South West, made it clear that changes were going to be made, and a number of the most vulnerable areas were hit by the fact that it was made clear that the working neighbourhoods fund was going to end in March this year. It seems to me that a number of councils did not make any provision for that and blithely assumed that the money would continue, despite the fact that the Labour Chancellor made it perfectly clear that it was ending. Ladies and gentlemen on the Labour Benches who cheered his Budget announcement did not raise any objection at the time.
The changes make the system fairer and more progressive than it has ever been. The second thing that we did is try to marry the need to tackle the deficit with the need to help councils to adapt, as I told my hon. Friend the Member for Cities of London and Westminster (Mr Field). In December, I said that no council would face more than an 8.9% reduction in spending power and that we would provide a grant to cushion councils that would otherwise have had a sharper fall. Today, we are going further by increasing the transition grant to councils from £85 million to £96 million next year, which means that the average reduction in spending power is just 4.4% and that no council will see a reduction of more than 8.8%.
Let us look at one of the problems that we faced. Concessionary bus travel is a classic example of how the previous Government did things-they made a grand promise without any clue about how it would be funded. Administration of concessionary bus travel under Labour was a shambles. I do not think that councils should have to pay for the misjudgment of the Labour Government, so I am topping-up the formula grant by a further £10 million next year to compensate shire districts.
Thirdly, we are committed to protecting local taxpayers. Council tax bills more than doubled under Labour, while front-line services such as bin collections halved. It is only right that we give hard-working families a helping hand.
Caroline Flint (Don Valley) (Lab): Does the Secretary of State agree with the sentiments of his colleague, the Under-Secretary of State for Communities and Local Government, the hon. Member for Hazel Grove (Andrew Stunell), who in writing to Liberal Democrat councillors about the final settlement, says:
"This final settlement certainly does not solve all problems, nor does it add significantly more money into the pot. I know it will still be very disappointing for many councillors."
Mr Pickles: Of course the settlement is very disappointing, but the Government would not do what we are doing had we not found the nation's finances in chaos and with a record budget deficit. The only reason that we are doing this is that the right hon. Lady failed to control her party.
Mr Betts: The Secretary of State said that this is a matter for local decision, and that there is no need for any council to make cuts to front-line services. Can he name one single council in the country that has so far managed to reach a budget decision without any cuts to front-line services?
Mr Pickles: Yes, I can-Reading and Ribble Valley have done so. We have a list, but the hon. Gentleman is ascribing words to me that I did not say. I said that before authorities touch front-line services, they should look at sharing back offices, chief executives and top offices, move back services and improve procurement. That is what I said. There is a very big difference-right across the country-between councils that have attempted those things and those that have decided to cut deep into public services.
Sir Alan Beith: Does the Secretary of State accept that it was almost impossible to introduce the required degree of fairness to areas of low council tax income given the historical settlement that many local authorities, such as Northumberland, have suffered over the years and the financial crisis that faced the country? Do we not need to approach fairness again in a more fundamental review of local government finance?
Mr Pickles: My right hon. Friend is absolutely correct. I certainly hope that this year's settlement and next year's are the last ones to be put together on the current corrupt, useless and incomprehensible system. It is the Government's intention fundamentally to review the local government financial system, and I hope to bring proposals to the House later in the year.
Paul Goggins (Wythenshawe and Sale East) (Lab): The Secretary of State has praised some local authorities for planning ahead for cuts, but he did not mention Manchester, which was planning to make cuts of £50 million. However, because he singled out one of the neediest cities in this country for one of the worst settlements, the council is now having to save £110 million next year and £170 million over two years. When a council has to lop off £39 million from adult services and £45 million from children's services, how can he say that he is protecting the most vulnerable?
Mr Pickles: There does seem to be a big difference between how Sheffield and other large authorities are going about this, and how Manchester is going about it. The reduction purely in grant is some 15% over the period, but the council is choosing to cut 25%-above and beyond the reduction in grant. But those figures only really stack up if we completely ignore the level of council tax revenue. That is why we are able to say that no authority is receiving a reduction in their spending power of more than 8.8%. That remains an absolute fact, on a measurement that those on the Labour Front Bench urged us to use. The Local Government Association also suggested that measurement, and it is a very sensible way of doing things.
Henry Smith (Crawley) (Con): My constituency has some of the most deprived areas anywhere in the region, but for the last eight years we have received among the lowest local government settlements there have been. My local authority has been preparing for the even tougher times we face because of the economic crisis that we were bequeathed. Why does the Secretary of State think that other areas of the country have not?
Mr Pickles: It appears that there are two kinds of authority. There are Conservative and Liberal Democrat authorities that seem to be making a genuine attempt to protect the front line, as are a significant number of Labour authorities, but there are several that are simply grandstanding. They have perhaps made one or two financial mistakes in the past and are seeking to hide them by claiming that the financial settlement is the problem.
Mark Pawsey: My right hon. Friend spoke about the need for councils to control executive salaries. Does he have some words of comfort for Rugby borough council, which has chosen to save £100,000 by not replacing its chief executive and devolving the responsibilities to deputies and the elected leader of the council?
Mr Pickles: Hammersmith and Fulham is obviously the apple of my eye in London, but the decision taken by my hon. Friend's council is a very sensible one. I am delighted that chief executives have taken a cut in salary, and I am even more delighted that the salaries advertised for chief executives have gone down considerably.
It is only right for hard-working families to be given a helping hand. We are providing an extra £650 million so that local authorities can freeze council tax for a year from April without local services losing out. We give each council that freezes or reduces council tax the equivalent of a 2.5% increase instead. More than 130 councils have already said that they will take this offer and more will follow as they finalise their budgets. No council should think that it can get away with squeezing its residents.
In the long term, local people should have the power to veto excessive council tax rises, but for the time being the Government will use their capping powers to protect them. Today I have laid before the House a written statement explaining the principles that we are using to define what excessive council tax means. An authority will be liable to be capped if it couples an increase in council tax of more than 3.5% with a reduction in its budget requirement of less than 7.5%. However, for most council tax payers, I very much expect this to be
largely an academic exercise, because I believe that every local authority will freeze council tax in this difficult period.
The public will be helped in that process by increased transparency. I am pleased to announce to the House that every council in the country has now agreed to publish every amount over £500, so that their council tax payers can judge whether cuts in services or decisions about those services are just. I say "every council in the country", but I mean "every council in the country with the exception of Nottingham". The Labour deputy leader in Nottingham says that the council has
"no intention of publishing the data unless it is forced to do so by law."
"We have said that we will publish accounts over £500 if it becomes a legal requirement to do so,"
"We are happy for information to be"
transparent. Well, information cannot be transparent unless it is published. How come every council tax payer in England can look on their council's website and see how it is spending their money except for those in Nottingham? Is there something peculiar about people in Nottingham that means that they cannot be trusted with that information?
Mr Pickles: I shall give way in a moment, once I have made this point. The right hon. Gentleman is a senior Member of the House, but I would be grateful if he extended me the courtesy of allowing me to make a few points.
The deputy leader of Nottingham city council is a gentleman called Graham Chapman, which is obviously the same name as the late and long-missed member of "Monty Python's Flying Circus". It seems to me that the right hon. Member for Don Valley (Caroline Flint) should get on the phone to that gentleman and tell him, as his namesake's mother did in "Life of Brian", that he might be the deputy leader of Nottingham city council, but he is a very naughty boy. If it is necessary for me to use the powers that I have to force Nottingham, I will, but why should this process be held back by one obdurate council that simply wants to play politics with transparency?
Hazel Blears: Let me take the Secretary of State back to his assertion that no council will lose more than 8.9% of its grant. Is he not completely ignoring the fact that the poorest authorities get area-based grant? Some 11% of my council's budget in Salford is ABG, because we are deprived and poor, and we need extra help. Slashing the area-based grant means that our cuts next year will be 15%, which is a massive amount in the first year.
I can bring better news to the right hon. Lady, because the figure will not be 8.9%, but 8.8%, which I hope she finds helpful. She arrives at those figures only if she completely ignores the figures for council tax, which are such that we can give her a guarantee that her council's spending power will not be reduced by more than 8.8%. Because I have enormous respect for her, I shall make just one further point. I thought about this issue seriously, in a situation where money was clearly being reduced, and I came to the conclusion that
if I increased relative need, the best way to help authorities such as hers in taking the money down would be to put it into the block grant. That is because the block grant has such a distributive effect. I accept that there is a degree of swings and roundabouts involved, but her authority came out of that process better than it might otherwise have done.
Mr Blunkett: This issue of transparency is absolutely crucial. Is it not a fact that the 8.9% and the distribution of grant took place after the area-based grant-and therefore the specific funding for specific deprivation-had already been taken out?
Mr Pickles: The right hon. Gentleman will forgive me for correcting him: it is not 8.9%; it is 8.8%. We have put some additional sums into the process-[Hon. Members: "Answer!"] I am sorry that he perhaps did not hear the answer that I gave to the right hon. Member for Salford and Eccles (Hazel Blears). I took a view, which I think was correct, that his authority, Sheffield, would have lost out more had we not put those sums into the block grant. He seems to forget that we have moved relative need to 83%.
Thanks to the constructive approach of many councils, we have arrived at a funding settlement for the next two years that is progressive, fair and sustainable. It is important to see this settlement in context. This coalition Government are committed to an historic shift of power and influence. We are seeking to restore real responsibility and authority to councils. We are ending the regional spatial strategies, comprehensive area assessments and local area agreements, and we have made a bonfire of the three-letter acronyms.
The general power of competence in the Localism Bill will give councils confidence to get on with the job. We have already ended grant ring-fencing, with a few exceptions, so that councils can decide for themselves how to spend their money. I am determined that we will continue to push back the tide of bureaucracy, end once and for all the micro-management from Whitehall, and give councils the space to show the ingenuity, ambition and leadership that local people expect. The settlement shows that this coalition Government will not shy away from the tough decisions needed to tackle Labour's public sector deficit, and we will continue to do everything possible to support local councils as they protect and improve front-line services over the years to come.
Caroline Flint (Don Valley) (Lab): We have heard it all this afternoon. We have heard every possible excuse and cop-out, but we have not heard a single word of apology to the thousands of councillors up and down the country who give up their evenings and weekends, and much else besides, to make their community a better place to live and who are now being forced to implement the Secretary of State's cuts. We have heard no apology for the fact that this Government have chosen to impose huge front-loaded cuts on local councils the length and breadth of the country. Those cuts will be deeper and faster than those made by almost any other Whitehall Department, and they will fall hardest on the poorest places. They will cost jobs and threaten vital front-line services.
Today the Secretary of State has tried to pull a fast one, but he has not convinced our own Labour councillors, or even many Tory or Liberal Democrat councillors. In fact, I do not think that he has convinced anyone at all. Once again, he has come up with a whole host of reasons why this finance settlement-which, by common agreement, is the worst funding settlement for local government in living memory-is not as bad as it sounds, but he is not fooling anyone.
Over the past few months the Secretary of State and his team have given us reasons why local authorities should not have to tackle difficult decisions about front-line services in their communities. They have told us that there are other ways in which local authorities can make savings. We have heard that councils are sitting on piggy banks with £10 billion-worth of reserves, yet 70% of that money is already reserved for specific projects, so the figure is nowhere near as high as £10 billion.
More to the point, the cuts to local councils go so deep and fall so heavily that three quarters of single-tier and county councils have less in their reserves than the cuts to this year's funding. Even if they took up the Secretary of State's suggestion and spent all their reserves trying to mitigate the damage the Government's cuts have caused, it would still not be enough. And when next year came councils would face an even worse funding crisis-but this time with no reserves to call on. That, Madam Deputy Speaker, is
"the economics of the madhouse".
Those are not my words; they come from a letter from the Conservative leader of Derbyshire county council, Andrew Lewer, who chastised the Secretary of State for peddling "misleading" myths about council reserves. We all know that the right hon. Gentleman likes to talk about bins, but when even his own colleagues tell him that he is talking rubbish, perhaps he should sit up and listen. If he will not listen to them, he should at least take note of his Front-Bench colleagues. However loyally the Under-Secretary of State for Communities and Local Government, the hon. Member for Hazel Grove (Andrew Stunell) nods his head in agreement this afternoon, we know what he really thinks from a private letter he sent to Liberal Democrat councillors. He freely admits that in some cases the figures quoted by the Department for Communities and Local Government were rejected as inaccurate. As I mentioned earlier, another quote from the letter reveals the Under-Secretary's disappointment that so little has been put into the pot, despite the representations of his Liberal Democrat colleagues.
Another area Ministers have looked at is how to plug the gap by dealing with executive pay. Councils were told that if they could not use their reserves, they could cut executive pay. If they did that, they were told, it would be enough to protect jobs and services. I have made it clear time and time again that local councils have a duty to find the best deal for council tax payers-and that includes ensuring that council executives are not paid over the odds and cutting down the size of management teams at the top of councils. In fact, we have gone further than the Secretary of State's proposals on pay and transparency in the Localism Bill, and I urge him again to include consultants and contractors hired by local authorities when pay details are published.
The suggestion, however, that simply trimming executive salaries by a few thousand pounds here and there is enough to plug a funding gap of £6.5 billion is just fanciful. If every chief executive of every local authority took an immediate 50% pay cut, it would yield less than 0.5% of the savings that need to be found. Even if the entire senior management team of every council in England reduced salaries by 25% overnight, 97% of the cuts would still need to be made.
Charlie Elphicke: Does the right hon. Lady agree that it is not simply a question of excessive pay, but of excessive pay-offs? Nottingham council was mentioned, and a brief piece of research shows that Sallyanne Johnson received a £250,000 pay-off, Michael Frater £230,000, Adrienne Roberts £500,000, and Tim Render £200,000-all in recent times. Will she condemn the administration of Nottingham council for wasting that money?
Caroline Flint: We can all trade examples, so let me provide the hon. Gentleman with one from Hammersmith and Fulham council-one of the Secretary of State's favourites. Is it acceptable to hire for £1,000 a day a consultant who has already been retired, on a £50,000-a-year pension, on grounds of ill health from another council?
Value for money and accountability for senior pay are important, which is why we supported those elements in the Localism Bill-but we are going further than the Government suggested, and we hope to gain support for that. However, the reality is that for all the grandstanding on this issue, it does not make a dent in the amount that councils have to find to deal with the front-loaded cuts that the Government have chosen to impose on them.
Graham Stringer (Blackley and Broughton) (Lab): My right hon. Friend mentioned the letter sent by the Under-Secretary of State for Communities and Local Government, the hon. Member for Hazel Grove (Andrew Stunell) to Lib Dem councillors on Stockport council; she will be aware that his postage bill will go down quickly, as Lib Dems are leaving the Lib Dem group because they know the truth about this settlement. Does my right hon. Friend agree that the Secretary of State is talking nonsense when he speaks about giving power to local authorities and being fair, because local democracy is, in fact, taking a much bigger cut than his own central Government Department?
Caroline Flint: My hon. Friend has made a very good point about the unfairness of the cuts. The Government are passporting the blame on to local councils, and that is not fair. My hon. Friend, like other Labour Members, has long experience of local government that can inform our debate. We are in touch with local government, which is one of the big differences between us and those on the Government Benches.
Chris Heaton-Harris (Daventry) (Con): The right hon. Lady suggests that cuts in executive pay constitute a mere pinprick in the savings required. Yet according to a press release from Hampshire county council that I received yesterday, the council expects to save some £7 million in executive pay in the current year. That is just shy of 20%- [Interruption.] Opposition Members suggest, in sedentary interventions, that £7 million in a single year may be an unlikely figure, and that may be so, but even if it is over three years- [Interruption.]
Caroline Flint: I do not know how to follow the hon. Gentleman's intervention, because it is a good example of the grandstanding that has been going on. I should love the hon. Gentleman to send me the figures from Hampshire county council. Seven million pounds a year? I should very much like to see those figures, because I am not sure that they relate only to senior executive pay.
I have made it clear that I am not standing up for those who pay over the odds. [Interruption.] I have made that very clear, as the Minister for Housing and Local Government will see if he consults Hansard. What I am saying is that it is a distraction to suggest that the sort of cuts in executive pay that I have described, whether they involve 50% of chief executives or 25% of the senior management team, can make a significant dent in the savings that councils are having to find.
We are often told that if councils cannot use their reserves and if cuts in executive pay are not enough, they can make their savings by sharing services or merging back-room functions. Let us leave aside the fact that more than 200 councils are already sharing services or facilities, or are planning to do that. If creative service redesign could protect services and stop unnecessary job losses we would support it, as would our local Labour colleagues, but by front-loading the cuts as the Secretary of State has chosen to do, the Government have given councils no choice other than to find immediate savings, which will actually mean cuts in services and jobs.
We have heard a great deal today about Westminster, Kensington and Chelsea, and Hammersmith and Fulham, but as ever, the devil is in the detail. When we go beyond the headlines, we find that although those councils will lose more than £50 million in funding this year, savings for this year amount to only £5 million. We can only conclude either that the Secretary of State is so detached from the real world that he does not understand that, or that this is a deliberate tactical attempt to distract attention from the problems created by the Tory-led Government. In either event, councils and the communities that they serve deserve better.
James Morris: Is not one of the remarkable aspects of the settlement the fact that, in these difficult times, the Supporting People grant has been relatively protected by the Secretary of State? He has done precisely what I think the right hon. Lady wants to do, which is to ensure the protection of the most vulnerable. Should not the right hon. Lady be celebrating that?
Caroline Flint: I am not sure that there is anything to celebrate. Whether we are talking about the Supporting People grant or Sure Start, one thing is certain: neither has not been ring-fenced, and therein lies danger. Manchester city council, for instance, faces a 35% cut in its Supporting People grant.
Mr Pickles: I am sure that the right hon. Lady would not want to put an incorrect statement on the record. Will she confirm that the Supporting People fund was not ring-fenced under the Labour Government?
Caroline Flint: Unlike the Secretary of State's hon. Friends, we put money into the Supporting People grant to support local initiatives. Now councils face cuts in their Supporting People funding, and have no alternatives to the decisions that they are having to make.
Mr Andy Slaughter (Hammersmith) (Lab): I will talk about the myths of Hammersmith and Fulham later if I have the opportunity, but for now may I correct my right hon. Friend by pointing out that £2.9 million is the saving for the three boroughs next year-£500,000 from Hammersmith and Fulham-out of £27 million in total savings? The sum the Secretary of State said the three councils would save when he launched the initiative last October was £100 million. That is the sort of voodoo economics we are dealing with here.
Caroline Flint: My hon. Friend always enlightens us as to the true nature of what is happening in Hammersmith and Fulham. Only in the last week we have heard about a building that houses some 30 charities, from which many of the charities are being evicted. I heard only the other day that Hammersmith and Fulham council is so in touch with the big society that refugees from Afghanistan who were seeking support were directed to an Afghan society that happened to be an Afghan hound society. That shows how in touch those people are with the concerns of their residents, and the extent of their knowledge of the charitable and voluntary sector.
Mr Betts: In the last Parliament the Communities and Local Government Committee conducted a report on Supporting People. It accepted the removal of the ring fence, but said that spending on Supporting People should be monitored. Perhaps as a result of that, the day after the Secretary of State appeared before the Select Committee in December, Westminster city council announced a £1 million cut in its Supporting People services.
Caroline Flint: I always bow to the experience and knowledge of my hon. Friend. This will all come to light in the weeks and months ahead as the budgets are set, and I think we will see that no Members on the Government Benches will stand up for Supporting People. We know that the losses on the ground are affecting people, and the services they have relied on for so long.
As all the excuses have fallen away, and as the reality of the pace and depth of the Government's cuts hits home, so Ministers' accusations and attacks on local government have become more desperate and outlandish. The real impact of these cuts is becoming clearer day by day. Some 450 libraries around the country are under threat of closure, including four in the Prime Minister's constituency, 250 Sure Start centres serving 60,000 families
look set to close by the end of this year, and despite all the Secretary of State's exhortations, because of the cuts he has imposed half a million British home owners have had their weekly bin collections scrapped. As for housing, his cuts in the housing budget mean that, for all the current Government's criticism of the last Government's record, once the homes that Labour started building are completed no new social homes at all will be built for the duration of this Parliament.
When 70p out of every pound councils spend goes on staff, it is madness to believe that people will not lose their jobs. The only advice we have from the Government comes from their big society guru, Lord Wei, who this week told council workers to cut their hours and their pay and spend more time volunteering. That will be of little comfort to the tens, if not hundreds, of thousands of people who lose their jobs this year. According to Unison, 100,000 people in council, health, police, fire and education services have already been warned their jobs are at risk. The GMB has kept a running tally of the number of workers who have been told their jobs are under threat, and, as of last week, it suggests more than 155,000 posts are at risk.
Let us talk about the organisation that has actually conducted some research in this area: the Local Government Association. It believes that 140,000 council workers will lose their jobs this year. I saw the Minister for Housing and Local Government on TV only last night attempting to argue otherwise, but the LGA's figures are based on evidence-on research covering 202 councils employing 1.85 million people. The Minister's arguments are based on the hope that, "If we say something enough times, eventually people will start to believe us."
Gordon Birtwistle (Burnley) (LD): Why is Liberal Democrat-controlled Sheffield city council making only 250 people redundant, yet the figures for Labour-controlled Manchester city council and Liverpool city council are 2,000 and 1,500 respectively? Could it be that the Labour councils are not interested in making proper savings, whereas the Liberal Democrat and Tory councils are?
Caroline Flint: Well, so far as Sheffield is concerned, part of the problem is that the Liberal Democrats are running scared. They have deferred the decisions because they think they can pull the wool over the eyes of the people of Sheffield, but I have to say to the hon. Gentleman that that is not going to work.
I want to say something about back-room staff in local government. Efficient administration: yes, of course we need that, but every organisation needs people in the back-room as well-even the Secretary of State's Department. It is a pretence to believe that administrative jobs are not necessary. Worst of all is the unfairness. The communities who rely the most on the services that their council provides will be hardest hit. Every time the Government hit the airwaves we are told how progressive this settlement is-but I am afraid that they do not know the meaning of the word. What is fair about the most deprived communities facing cuts four times as deep as those in the most prosperous areas? What is progressive about a finance settlement in which every resident in Hackney loses £180, while people in the Prime Minister's constituency lose only a fiver? Even Liberal Democrat and Conservative councillors know that that is neither fair nor progressive.
The Tory leader of Blackpool council, Peter Callow, told the BBC that this Government had "let down poorer areas". Perhaps that is why David Faulkner, the Liberal Democrat leader of Newcastle council-the Liberal Democrats' flagship council in the north-east-agreed that the Secretary of State is
"the worst Secretary of State we have had".
Perhaps that is why, in a private e-mail sent to Liberal Democrat councillors from the Local Government Association just last week, we learnt that- [ Interruption. ] I know that the Secretary of State does not want to listen to this. We learnt that
"concerns about the weakness of the Secretary of State have been raised within all three of the main political groups at the LGA and the message has been heard loud and clear by leading figures in the Government. The situation has been likened to having a republican in charge of the monarchy."
As for the big society, with every day that passes it looks more and more like a big sham. We have heard from Volunteering England, which accused the Government of undermining charities. Last week Liverpool City council had to pull out of the big society pilot because it saw how ridiculous it was for the Government to laud the virtues of the voluntary sector on the one hand, while pulling the rug from underneath it on the other. Just this Monday, Dame Elisabeth Hoodless of Community Service Volunteers warned that the "draconian" cuts to local government were "destroying volunteering". But as the Prime Minister said earlier this afternoon, what does she know? She is only the mother of the big society, the executive director of Britain's largest volunteering charity.
Up and down the country, as a direct result of the choices of this Government, councils are being forced to cut back funding to community groups and voluntary organisations. If they cannot pick up the reins, who will take responsibility for providing the services that this Government have dismantled?
However, Ministers' most insidious claim is that councils that have built up good services to help poor, elderly or vulnerable people will deliberately cut those services, rather than bureaucracy, in order to cause suffering for political gain. That is an outrageous slur, and it is beneath the dignity of Ministers to level the claim. It is a sure sign of how empty the Government's arguments are that they drag out that myth in order to slander the reputations of decent councillors.
The blame for all this lies solely and squarely with this Tory-led Government, because the biggest myth of all is that there is no alternative. Madam Deputy Speaker, there is an alternative. We do not deny that there is a deficit and that it needs tackling, but the Government's decision to eliminate the deficit over this Parliament is a choice, not a necessity. Labour's plan was to halve the deficit over four years. That would have meant local government cuts, but not cuts as deep as this. The Government's decision to front-load the cuts, so that the heaviest reductions fall in the first year, is a choice, not a necessity. We would have spread the cuts more evenly over four years, giving councils time to plan where savings could be found. The Government's decision to skew the funding system so that the poorest councils are hardest hit is a choice, not a necessity. We would have shared the cuts much more fairly, ensuring that those with the broadest shoulders bore the greatest burden. The Government have made their choice, and they must take responsibility for the consequences.
Flush with cash from their chums in the City, this Government may be laughing all the way to the bank, but local councils and the communities they serve are crying out for more help and more time. In every part of the country and in all communities, people are rallying together, standing side by side, shoulder to shoulder, against this Government's reckless cuts. They are the real big society, and they are telling this Government that they are going too far, too fast. The teaching assistants, social workers and street cleaners marching for their jobs: they are telling this Government that they are going too far, too fast. The pensioners occupying their local libraries and clearing the shelves of books: they are telling this Government that they are going too far, too fast. The families going door to door with petitions to save their local Sure Start centre: they are telling this Government that they are going too far, too fast.
The Government are not listening but we are, and that is why, today, Labour will vote against a local government settlement that reflects none of the concerns of councillors and communities about going too far, too fast. I urge all Members to stand up for their communities and the services they hold dear, and join us in the Lobby tonight.
Madam Deputy Speaker (Dawn Primarolo): I have to announce the results of the Divisions deferred from previous days. In the Division on the question relating to the financial stabilisation mechanism, the Ayes were 297 and the Noes were 45, so the Ayes have it. On the question relating to police, the Ayes were 501 and the Noes were 18, so the Ayes have it. On the question relating to taxation of the financial sector, the Ayes were 295 and the Noes were 223, so the Ayes have it.
Andy Burnham (Leigh) (Lab): On a point of order, Madam Deputy Speaker. I am sorry to interrupt the House, but this is on a matter highly relevant to this debate. At Prime Minister's questions earlier today, the Prime Minister gave an inaccurate picture about Sure Start funding to this House. He said:
"On Sure Start, the budget is going from £2.212 million to £2.297 million. That budget is going up. That is what is happening."
There are two problems with that statement. First, those figures do not refer to the Sure Start budget; they refer to the early intervention grant, which pays for 21 separate programmes in addition to Sure Start. Secondly, the budget is not going up. The Prime Minister's figures compared 2011-12 with 2012-13. If he had compared this year's budget of £2,483 million with that in 2012-13, he would have found that there is a cash cut of £186 million.
Councils are making some very difficult decisions on these matters right now, and it is only fair to them to put the correct figures on the record and in the public domain. I wonder whether you might ask the Prime Minister to set the record straight, Madam Deputy Speaker.
Madam Deputy Speaker (Dawn Primarolo):
That is not a point of order for the Chair. The right hon. Gentleman is very experienced, and I am sure that he will find other ways to pursue those particular points about statements that have been made in this House. He
is right to say that this is a very important debate on the question of local government funding. Perhaps other hon. Members might wish to reflect on what he has said, but we will move on and continue that debate.
Mr Andrew Turner (Isle of Wight) (Con): I shall keep my comments relatively brief, Madam Deputy Speaker. I wish to start by thanking the Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Bromley and Chislehurst (Robert Neill) for receiving a pre-Christmas delegation from Isle of Wight council. During the meeting, the council accepted that it must play its part in tackling the massive structural deficit left by the Labour party. It also accepted the vast majority of the figures and calculations in the draft local government settlement. The council queried only one point in it with him. The argument was solely about the baseline figure used for local transport and concessionary fares. The council contends that a miscalculation has denied it additional grant of almost £900,000, which obviously has an effect on the council's overall spending power. The Government say that in 2011-12 Isle of Wight council will have £6 million less to spend than in the current year, whereas the council suggests a figure of £7.5 million.
The Government's spending power figure covers all the council's income available for it to spend. That is clearly the best way of presenting the figures: looking at the picture as a whole, rather than taking any single figure in isolation. The council has given me details of the notional figure, the effect of damping, schedule D, the transfer of functions between authorities and the baseline figure that it believes is wrong.
I do not, however, intend to go over all that again. Doubtless the council's view on all those points was put very eloquently during its meeting with the Minister. Figures can be presented in many ways, and they certainly have been, both on the island and nationally, but I am speaking today because I see the very real distress caused to my constituents at proposals that will affect services they value and the fabric of our life on the island. Among other things, island communities might lose libraries and public lavatories unless, in some cases, those services are taken over by town and parish councils, thus putting up the local precept-the town and parish rates. The changes should have been made separately from the Budget, preferably in the period between last June and December. After all, we won the election in May and there was time to do it then rather than making these changes in a last-minute rush. However, we are where we are, as they say.
I understand that the arguments about the draft settlement report have been considered and that decisions have been made, but the council says that the baseline figure that it says has been miscalculated will affect the settlement for future years. We all know that the complete financial mess the coalition Government inherited from the Labour party is the real problem and that neither councils nor the Government can go on as they have in the past, but I urge the Minister to consider the technical arguments that Isle of Wight council put to him. He and the Secretary of State should consider whether those arguments have merit and, most importantly,
whether my constituents are losing out because of the way in which the figures have been calculated. I hope that the Minister can assure me that if there is any doubt about that he will enter into further dialogue with the council so that the effects can be addressed as soon as possible.
Mr Clive Betts (Sheffield South East) (Lab): The Secretary of State has obviously listened to many representations in the past few weeks, but the question is whether he has actually heard what people have been saying and whether he is prepared to act. Today, we have found out that, presumably after prostrating himself on the floor before the Chancellor, he has come away with a further £10 million.
Mr Betts: Local authorities are going to get a further £10 million on top of the settlement they were previously promised. Even if that £10 million was given to one authority, such as Salford, instead of its reduction in total spend being cut from 8.9% to 8.8%, there would hardly be dancing in the streets. Authorities such as mine in Sheffield are getting nothing extra out of that small amount of additional money: they will still get a cut of more than 8%.
Mr Pickles: The figure is £10 million extra to district authorities. That is why the cut for authorities is no longer 8.9% but 8.8%. Extra money has gone in-not a lot, but we have been able to drop the cut a little.
My first point, which I made in a Westminster Hall debate but still have not received an adequate response, is that the overall cuts in Government expenditure over the four-year period are 19%, whereas the cuts for local government are 26%. Why is local government experiencing higher cuts than the overall average cuts to Government spending? We know that the services delivered by local government are important to our constituents. Some of those services go to those in most need-social services provision for aids and adaptations and for looked-after children. Some of them concern quality of life-for example, libraries, parks, playing fields and sports centres-and others are essential, such as refuse collection, street repairs and street lighting.
Most local authorities are doing all they can to protect their social services provision and to protect looked-after children and children with particular disadvantages, so it should come as no surprise that even when they have looked at back-room services and sharing services with other authorities, councils throughout the country of all political persuasions are cutting services such as libraries and bus services and changing their methods of refuse collection.
Mr Betts: There were ear-marked allocations, including some transferred money from NHS funding, but even so local authorities are facing severe reductions. Westminster, a flagship Conservative authority, is cutting £1 million from its Supporting People budget. Hammersmith and Fulham was named for cutting eight community centres, I understand. Gloucester and Somerset councils are cutting libraries and closing them. Those are cuts in front-line services. Even authorities that are sharing services and cutting management costs still have to cut front-line services. Why has local government been singled out for bigger cuts than the rest of central Government combined?
Brandon Lewis (Great Yarmouth) (Con): Does the hon. Gentleman acknowledge that local authorities across the country, such as my own in Great Yarmouth-we are a deprived area that has been hit with cuts-have said that they can deal with the changes without affecting front-line services? They are looking to do that through back-office savings and cross-working with other authorities.
Mr Betts: All I can say is that the hon. Gentleman's authority must have had a much more favourable settlement than many others that are making those cuts. That is not happening on a party political basis. Conservative and Lib Dem authorities are making cuts as well. I am more than happy to receive a list from the Secretary of State of all the authorities that are managing the process without any cuts in front-line services. It will not include many Conservative and Lib Dem authorities, which are presumably making cuts not to spite the Government, but because of the position that they have been put in by the Government.
My next point is one made by the Local Government Association on a cross-party basis. Why are the cuts front-end loaded? Will someone explain? Even if the Government feel that they have to make the cuts over the four-year period, why are they front-end loaded?
Why are the cuts front-end loaded? Why do nearly half the cuts come in the first year? I was in Croydon council on a Select Committee visit on Tuesday. Croydon council is a flagship Tory authority. It has participated in Total Place, it has community budgeting, it is part of the big society project and it is enthusiastic about it. The leader of the council sat across the table and said to me, "The thing that is really affecting us and may stop us delivering on projects like community budgeting and
the big society is the front-end loading of the cuts, which is making it impossible for us to deal with them in a planned and organised way."
That is a Conservative authority, and the Local Government Association is saying exactly the same. The front-end loading is forcing the cuts up front, which makes it harder to reorganise and to provide services in a different way. It means more money being spent on compulsory redundancies. It is a major problem, and nobody will explain why the cuts must be front-end loaded. Why?
Charlie Elphicke: Do not many local authorities have substantial reserves? The reason for having reserves is to provide a cushion. Manchester, I believe, is cutting 2,000 staff, yet it is sitting on £100 million of reserves. How can that be justified?
Mr Betts: -over which authorities do not have discretion. The figures include the housing revenue account and working capital that is needed to manage the cash flow of an authority, and they probably include identified sums in the authority's capital accounts for major projects. All those things tend to get lumped together. The Secretary of State says that is not true. If he produced a list of figures for each local authority that extracts all those sums, that would be very interesting to see. I look forward to a copy of that being placed in the Library.
Paul Goggins: My hon. Friend might like to comment on the claim made by the hon. Member for Dover (Charlie Elphicke), because Manchester city council will have to spend £60 million of its reserves simply making people redundant as a result of the cuts.
Mr Betts: The Secretary of State has had an exchange of letters with the Conservative chair of the Local Government Association, who has complained bitterly that if more than £200 million is required nationally in capitalisation to pay for redundancy costs, that will result in a further cut in the grant to pay for it.
I will move on to the spread of the cuts. It is undoubtedly true that local authorities in the most deprived areas are getting the biggest cuts. Government Members will say that those authorities have the biggest grants, which by and large is true, but that is because they have the biggest needs and the most deprivation. The reality is that my local authority is getting more than an 8% reduction in its spending powers and Dorset county council is getting an increase. That is simply not fair.
I have already given way to the hon. Gentleman and think that that is reasonably fair. The spread of the cuts is simply not fair. I accept that the
Government have provided an element of transitional grant to help those authorities with most deprivation, but they simply have not gone far enough to protect those with the most needs and the most deprivation. That is why those areas now face the biggest cuts in services.
Ms Louise Bagshawe (Corby) (Con): Does the hon. Gentleman think that it is right that only months before announcing these job loses, Manchester city council spent £150,000 on a statue, which could have funded nine junior posts for a year?
Mr Betts: Manchester city council has to make its own local decisions, and I am not here to support or defend every action of every local authority. I thought that leaving such matters to local councils was what localism was all about. We must not put them in the position where they have to make cuts in front-line services, as Somerset, Gloucester and other authorities are having to do.
I support what the Government are doing on ring-fencing. I believe, as I have been saying for many years, that abolishing ring-fencing as far as possible is the right thing to do so that local authorities have more discretion in how they spend the money available to them. On the question of business rates, I followed up with the LGA the issues I raised with the Minister for Housing and Local Government in my Westminster Hall debate. It has received legal advice on the matter from Bevan Brittan solicitors, which states that in this instance the Secretary of State has not set the distributable amount as a sum equal to the difference, but has chosen to budget for a surplus and set the distributable amount some £100 million lower at £19,000 million. That is simply unlawful, and that is the legal opinion the LGA has received- [ Interruption. ] I am raising the issue with the Secretary of State and giving the advice that the LGA has given me. If it is inaccurate, will he publish a precise assessment on whether he intends to budget for a surplus on the business rates and whether he believes to do so is lawful so that Members have the full and proper picture?
Mr Pickles: The hon. Gentleman occupies a senior position and so should know that all business rates have to be redistributed to councils by law. It is not possible to do what he is suggesting we are doing, because nothing can be done with a surplus other than giving it back to local authorities. He does not seem to appreciate that total public expenditure is within an envelope, but revenues from business rates go up and down, so councils are compensated by central Government.
Mr Betts: I understand that revenues from business rates go up and down, so when they go up more should be distributed to local authorities as a result. [ Interruption. ] Rather than engaging in further debate on this, I am happy to pass on to the Secretary of State the legal advice that the LGA has given me and ask him, if he believes that it is wrong, to issue a detailed correction. That seems an appropriate way to proceed.
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