Local Government Financing

Part of Opposition Day — [2nd Allotted Day] – in the House of Commons at 7:42 pm on 29th June 2010.

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Photo of Andrew Bridgen Andrew Bridgen Conservative, North West Leicestershire 7:42 pm, 29th June 2010

Let me make a little progress and I am sure the theme will become clear.

That funding difference is putting the children of North West Leicestershire at a major disadvantage. The two biggest senior schools in my constituency-Ashby and King Edward-are disadvantaged by nearly £1 million and £500,000 respectively each year compared with the city of Leicester. That simply is not fair.

Perhaps the biggest unfairness emerges when we consider the level of deprivation in North West Leicestershire. According to the last census, in one ward in my constituency 468 children were living in income-deprived households, yet their educational needs were funded by £600 less this year than were those of pupils in the city of Leicester. That cannot be right, and I look forward to the pupil premium redressing this unfairness.

Despite these funding shortages, Leicestershire county council is performing excellently and is a four-star council. According to independent inspectors,

"the Council is good at managing its money and making savings to spend on the most important services".

The independent inspectorate also comments on how

"Leicestershire County Council manages its finances well. Council tax is low compared with other areas and it provides a wide range of good and excellent services. This means it provides good value for money. In 2008/2009 it saved almost £11 million and it is on track to make further savings this year. These savings are then spent on improving services".

It is vital that well-run local authorities such as Leicestershire be looked at sympathetically when it comes to departmental spending cuts. Fit organisations have little fat to cut away; it is the bloated authorities that have been disproportionately funded and badly managed that should be looking at trimming their organisations. Perhaps they will decide not to do that, and to pass on the costs of their inefficiency to the long-suffering taxpayer. I urge us to remove the cap on council tax increases, which will allow them to do just that. Councils that choose to take that path will then expose their profligacy, waste and poor management to the wrath of the electorate, leaving them fully accountable for their actions-hopefully through the ballot box.

It is not just in education where my constituents are suffering the effects of the previous Labour Government's policies, but also housing. The previous Labour district council in North West Leicestershire, before being relieved of office in 2007-with the biggest swing in the country against Labour in those elections, but that is another matter-left the council housing stock in a lamentable state, rated as "poor", with no stars. Despite this, owing to Labour Government policy we have the ludicrous situation in which a third of all the rents we collect every year are passed back to central Government to maintain housing stock in other areas, despite the fact that a third of our housing stock is classified as "sub-standard", that we have elderly residents who are still forced to rely on solid fuel for heating and water, and that rents are increasing. We need to end this unfair and inefficient arrangement. I also look forward to councils being able to retain moneys raised by selling council houses, so that they can be re-invested in building new council houses in the district.

When the Opposition talk about local councils not building social housing, they might want to consider the fact that, in answers to questions in the last Parliament, the Government conceded to my right hon. Friend Grant Shapps that the £200 million a year collected in local council rents nationally was not even spent on housing but simply entered the general taxation coffers. Despite this, they have left us with the largest deficit in the history of this country at £156 billion.

There is a comparison to be made between the financial management of the previous Labour Government and the management of North West Leicestershire district council when it was under Labour control. During those sad 33 years of Labour control, my constituents faced an above-inflation council tax rise, year in, year out.

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