Local Government Finance

Part of the debate – in the House of Commons at 4:04 pm on 22nd February 2017.

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Photo of Gareth Thomas Gareth Thomas Party Chair, Co-operative Party, Shadow Minister (Communities and Local Government) 4:04 pm, 22nd February 2017

As we have gently suggested before in this Chamber, we simply do not think it is the right time to cut corporation tax for businesses like Amazon, Sports Direct or Britain’s biggest banks. It is important that we get business rates right, because from April 2019 local government will be increasingly reliant on that income stream to fund vital public services. Since the Conservative party came to power, funding from central Government has been cut by over 40% and they want to axe the revenue support grant completely. Councils will spend some £10 billion less on England’s local public services this year than they spent in 2010-11. Ministers have never denied the Local Government Association’s calculation that local authorities are facing a £5.8 billion gap by 2020 just to fund statutory services.

Today’s settlement represents a further cut in councils’ core spending power. Not a single extra penny of new money for local government has been found for the care of Britain’s oldest and most vulnerable citizens. Some £4.6 billion has been axed from social care budgets since 2010. More than 1 million English adults, people who have served our country and deserve to be treated properly and with dignity, are estimated to have unmet care needs, which is a remarkable, almost 50% increase since 2010. The crisis is having profound consequences for the NHS and forcing councils to axe funding for other vital local services to enable them to provide even the most basic service to the most vulnerable.

Last July, the Association of Directors of Adult Social Services warned of serious problems in social care, but the Secretary of State did not act. In October, the Care Quality Commission said that adult social care services were at a “tipping point”, but the Secretary of State dismissed it as an exaggeration. There were briefings that action would be forthcoming in the autumn statement, but that came and went. When the statement on local government finance came around in December, all we were presented with was money being moved from one council funding pot to another and permission to raise council tax quicker than before.

The social care precept raises vastly different sums of money in different areas and is completely unrelated to need. It shifts the burden of solving a national crisis on to hard-pressed local councils and local residents, including all those only just managing to make ends meet. Members from across the House and from all parties have called on the Government to act. The Chairs of the Health, Communities and Local Government and Public Accounts Select Committees have called on Ministers to act, yet the crisis has just got worse. The Association of Directors of Adult Social Services and the head of the NHS have also called on Ministers to act, while Age UK says that the English social care system is facing complete collapse.