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Local Government Finance

Part of the debate – in the House of Commons at 3:29 pm on 5th February 2020.

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Photo of Lyn Brown Lyn Brown Shadow Minister (Treasury) 3:29 pm, 5th February 2020

First, I congratulate hon. Members who have given maiden speeches, particularly my hon. Friend Kate Osborne—I loved her stuff about Ellen Wilkinson, who has always been a massive heroine of mine. I also congratulate the hon. Members for Orpington (Mr Bacon), for Keighley (Robbie Moore), and for North Norfolk (Duncan Baker). I was reminded of my husband complaining to his business partner after I said that I had booked a weekend away in Keighley. He said, “What, we are going to Bradford?” Never mind.

As we heard from my hon. Friend Andrew Gwynne and other hon. Friends, the Government’s rhetoric about levelling up is not really going to do much for the constituencies that they won in December. To be honest, I am worried about what it is going to do in my constituency too.

I would like to set the scene a little bit and introduce Government Members to Newham, which is one of areas worst damaged by austerity. If the proposed funding settlement is approved, Newham’s grant will go from £244 million in 2013 to £148 million in the coming year. In that period, our population has grown by 15%, so the cut is almost 50% per person over seven years. We have the second-highest child poverty rate in the country, made worse by cuts to children’s services. We have terrible problems with knife violence, made worse by a decade of cuts to youth services. We do have, thank goodness, strong communities, but they are struggling after a decade of across-the-board cuts.

Today I want to focus on just one point, because time is short. I talk regularly about the harm that homelessness in temporary accommodation does to our children. Going into temporary accommodation means losing a sense of security. It means losing a safe, warm home. It often means parents losing jobs, and losing the support network of family and friends, because people are moving away from their family, often miles and miles away, with no choice whatever. It means having to change schools constantly, or travel for hours to keep the one little thing that is solid and secure in a child’s life—a place at their secondary or primary school. More and more often, it means being moved halfway across the country.

We should be clear about why this is happening—it is because of low wages, extortionate private rents, and slashed housing support. That is not all the responsibility of the Secretary of State—I get that, and it is a shame that he is not here to hear it—but if council homes were available, like the one I had when I was growing up, none of those causes would lead to the extent of homelessness that we now see. In Newham, we have 27,000 families on the homelessness waiting list. They need and deserve a safe and affordable home, but they are denied that home because council houses were sold off and never ever replaced. Grants to replace those homes have now been cut. The rise in temporary accommodation has causes in Government decisions.

That has massive consequences for council finances. Our local authorities are spending over £1 billion a year on temporary accommodation, often at absurd prices for dire quality. The net temporary accommodation bill for Newham has reached £5.5 million a year. The scale of the crisis is absolutely massive. There are 7,725 children in temporary accommodation paid for by the London Borough of Newham. Newham covers 36 sq km, but we have more children living with that form of hidden homelessness—poverty, and poverty of opportunity —than entire regions of England. Let me be clear: that means Yorkshire and the Humber, north-east England, south-west England and the east midlands combined. Greater need, and greater costs for the council, are located in 36 sq km than in 63,000 sq km.

I thought the Secretary of State might be present for this debate, so I looked at his local authority, Newark and Sherwood District Council. There is deprivation and unfairness in the Secretary of State’s patch—I have seen the deprivation map—but overall the number of children stuck in temporary accommodation in Newark is 16. That is 483 times lower than the figure in Newham, so how exactly is it fair to prioritise places such as Newark over places such as Newham? Newham and Newark are not the same—none of our places are the same—and different places do not have the same level of need. They do not have the same deprivation or the same projected population growth for the very near future as we have. They do not have the same living costs for council staff, the same numbers of old people or the same numbers of children needing care. As we know, those latter two services are the most expensive council services of all. Different places cannot raise an equal amount of revenue. In Newark, a 4% rise in council tax raises £14 million; in Newham, it gets us just £3 million.

This is not actually about fairness. All these fine words are cover for a massive transfer of resources from historically Labour areas—including the seats just won by Conservative Members—to the Tory shires. The Government’s plans will not help areas like mine, and they will not solve our problems or heal our divisions, either. To be honest, they are only going to deepen them.