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Local Government Finance Settlement - Statement

Part of the debate – in the House of Lords at 6:32 pm on 19th December 2017.

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Photo of Lord Bourne of Aberystwyth Lord Bourne of Aberystwyth The Parliamentary Under-Secretary of State for Wales, The Parliamentary Under-Secretary of State for Communities and Local Government 6:32 pm, 19th December 2017

My Lords, the noble Lord referred to his 51 years in local government. We know from his contribution today that he has not lost any of his enthusiasm—like a young colt, he was anxious to intervene and make his point, and I congratulate him on that. However, it was the usual dismal litany of matters that he set out, and unlike his noble friend on the Labour side, he did not welcome some of the points in the Statement. Let me try to deal with some of the perfectly fair points that he made, some of which I will respond to, if I may, subsequent to the Statement.

On how far the fair funding review has gone, as I indicated we are opening the consultation today for response by 12 March, with the intention of bringing it in in 2021. Obviously, there is thinking on the broad general principle, but we want to see how we look at issues of deprivation and provide a fair funding formula.

The noble Lord referred to the broader question, which has been raised before, perfectly validly, of online shopping and the fact that there are some very large players such as, but not limited to, Amazon. He suggested that it is perhaps a question of rebalancing some of the ways that we raise money. I will cover that in a letter, if I may, but from memory I think that there is an international aspect to this issue that kicks in in the spring—there is reference to this issue and we are participating in that. I appreciate that that is a rather woolly reference, but I will clarify it in correspondence.

The noble Lord referred to the significant challenge, which certainly exists, in children’s social care and adult social care. We have provided already a precept of 3% from the last Statement a year ago, and we have increased flexibility this year in relation to the referendum, which helps. However, I accept that there is a significant challenge. I accept also that the noble Lord is right to say that we will be checked against delivery.

The noble Lord made a point about capital purposes, and we are both mere lawyers in this regard. However, I think that there is probably some accounting process whereby transformational investment from capital funding, which would help with the revenue side of things, is classified as capital. I suspect that that is the case, but again I will take up that somewhat technical point in correspondence.

The noble Lord is right to refer to a broader consideration of the complex—or perhaps not so complex—interrelationship between the health service and social care and the need to get that right. This has challenged Governments of all colours in the past, but I accept that there is a broader question that we need to look at.

The noble Lord will be pleased to know that, in relation to Newcastle, there is a £2.3 million increase in funding from this settlement, quite apart from the referendum uplift, and a maximum additional funding of £6 million as a result of the council tax flexibility previously announced. I am sure that that is of some comfort.