Local Government Financing

Part of Opposition Day — [2nd Allotted Day] – in the House of Commons at 5:05 pm on 29th June 2010.

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Photo of Jim Cunningham Jim Cunningham Labour, Coventry South 5:05 pm, 29th June 2010

The hon. Gentleman has his facts wrong. It was Ericsson that wasted public money, because it misled everyone-including the Tory council in Coventry-into thinking that it was there to stay. The hon. Gentleman must not distort the facts.

The Secretary of State has sent a circular out to local authorities, but we want to know whether the Kings Hill and Keresley housing project will go ahead. I asked the Minister to clarify that last week, and I was told that Coventry council would be allowed to settle the matter. However, when the Tories were in opposition, they said that one of the first things that they would do was cancel that project, because it was being built on the green belt-which Mark Pawsey knows something about, as Warwick district council is the planning authority and has been passing the buck.

If we are talking about the 1980s, let us remember that manufacturing in the west midlands was decimated, to say the least. In Coventry, we lost thousands of jobs every week. Are we going back to that? That is what the Government's proposals will mean. The Minister talked about council house building being the lowest since the war, but I do not remember many council houses being built in Coventry in the 1980s. I certainly remember that council houses were sold off and not replaced. The Minister has a lot of explaining to do there.

The other area of concern is what will happen to the voluntary sector especially and to the much vaunted public sector, which the Government keep on about attacking. How much funding can the voluntary sector expect, if funding to the public sector is reduced? As in the 1980s, the public sector will be the whipping boy for the measures that the Government want to take. I could see their strategy when they were in opposition. They went on about gold-plated pensions and big salaries for chief executives. That is fair enough-we have to do something about it-but it obscured and masked the fact that many people in local government are on low pay, and they are the people who will be attacked. I was in contact with Coventry city council today. The real impact, by the way, will not be known until October or November, because the Government themselves do not yet know which cuts they are going to inflict-they have not worked out the details-not only in Coventry but in the rest of the country.

The Government blame us for the economic crisis, but I remember when it broke. The Conservatives thought that we just needed to bail out Northern Rock and that the crisis had just happened in this country, but it actually happened with Lehman Brothers in America. How any British Government can control what goes on in the American economy defies logic. It was only later that the Conservatives worked out a strategy. Incidentally, the present Governor of the Bank of England went along with the economic stimulus-the same man now advising the Government to go down the road of wholesale cuts. We had a programme to do that over the four years, but theirs is a knee-jerk reaction. In other words, they have panicked, they are not in command of the economy and they do not have a strategy to get the country out of this situation.

This is a typical Tory ploy. In the '80s, they used the Labour Government of the '70s to try to justify some of their policies, but they missed something out. Before that Labour Government of the '70s, we had a Tory Government. Do we remember the three-day week? Do we remember the OPEC crisis when petrol prices went through the roof? The American economy had problems because the American public reacted to the prices at the petrol pump. We then inherited, as a minority Government, a previous Tory Government's problems, and I predict that, in the future, we will be picking up the pieces once again for the damage that these people have done.

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