Local Government Finance

Part of the debate – in the House of Commons at 7:00 pm on 30 January 2002.

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Photo of Nick Raynsford Nick Raynsford Minister of State (Department of Transport, Local Government and Regions) (Local Government) 7:00, 30 January 2002

I would like to make a little progress because literally only one sentence of my speech has related to the local government finance report. I have been happy to take questions in relation to education and housing, but I would like to make a little progress and I will then give way.

Over the past five years, we have been tackling a backlog of under-investment and inadequate general revenue funding. For 2002-03, total revenue support from Government will amount to £47.4 billion, an increase of £3.3 billion, or 7.5 per cent. on this year. The general grant formula distributes £40.3 billion of that, including the police grant, which the House has just debated. Excluding police grant, the remaining formula grant for 2002-03 will total £36.5 billion, an increase of £1.8 billion or 5.3 per cent. on the current year. Those are very substantial increases at a time when underlying inflation is running at under 2 per cent.

During consultation, local authorities impressed upon us that they still face financial problems this year, particularly in the case of social services. We considered those points and we will continue to discuss the needs of social services authorities with representatives of local government. We have already demonstrated our willingness to respond to the evidence presented by social services authorities in the initiative agreed late last year by the Secretary of State for Transport, Local Government and the Regions, and the Secretary of State for Health to respond to bed-blocking pressures.