Clause 31 - Accounts and audit regulations

Part of Local Audit and Accountability Bill [Lords] – in a Public Bill Committee at 9:15 am on 19 November 2013.

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Photo of Chris Williamson Chris Williamson Labour, Derby North 9:15, 19 November 2013

I am not sure whether the hon. Gentleman is living in a parallel universe. I would be interested to hear whether he can cite a specific example of that. He should look at the sorts of situations that local authorities, whether Labour or Conservative, face. This is not a party political issue. Local authorities right across the piece are alarmed about the scale of the cuts being imposed on them, and they have used their reserves to manage the cuts in an orderly way. Of course, it can appear curious that reserves are being built up while cuts are being made, but local authorities are between a rock and a hard place. They have got to use their reserves creatively to minimise the impact of the funding cuts. I hope that the hon. Gentleman will recognise that, because this issue affects not only Labour local authorities, but all local authorities. The situation is patchy, because local authorities in the most deprived parts of the country have been subjected to the biggest cuts, but all local government has had significant reductions.

Local authorities face a difficult situation, and it is unreasonable for the Government to impose a clause such as this, which could meddle with authorities’ ability to manage a financial situation that they are in through no fault of their own, but as a result of Government decisions. If localism means anything, local authorities must be empowered to manage their finances on the ground in a way that reflects their needs and the pressures on them. If Whitehall and the big, heavy hand of the Secretary of State disrupt that ability, it will have a very negative outcome on council tax payers.