Harrow Council Funding — [Sir Christopher Chope in the Chair]

Part of the debate – in Westminster Hall at 4:17 pm on 18th December 2018.

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Photo of Rishi Sunak Rishi Sunak Parliamentary Under-Secretary (Housing, Communities and Local Government) 4:17 pm, 18th December 2018

It is a pleasure to serve under your chairmanship, Sir Christopher. I start by congratulating Gareth Thomas on securing this debate. His pride in his home is evident to all, and I pay tribute to that. It is good to see my hon. Friend Bob Blackman here; he is also a champion of his constituency, particularly when it comes to matters of local government. We are grateful for and appreciate his particular experience and insights in our debates.

I welcome the opportunity to respond to the important points that the hon. Member for Harrow West raised. In doing so, I thought it would be helpful to use a framework that I like to use—my vision of the role of local government, which consists of three main areas. The first is to drive economic growth, the second to help the most vulnerable in our society and the third to build strong communities. If hon. Members will allow me, I would like to take those areas in turn, specifically in relation to Harrow, and address the points raised.

The draft local government finance settlement, which was published last week, confirms that core spending power across the nation is forecast to increase from £45 billion this year to £46.4 billion next year, representing a cash increase of 2.8% and a real-terms increase in resources available to local authorities. In the next financial year, Harrow Council’s core spending power will rise to £180 million, representing a 3.7% cash increase, which is substantially above the average for England and, indeed, other London local authorities. Core spending power is the standard measure of a local council’s financial resources, and it includes money from central Government grant, council tax, business rates baseline and further specific grants for adult social care and the new homes bonus.

Beyond grants, as my hon. Friend the Member for Harrow East said, driving economic growth is the only way to ensure the vibrancy of our local communities and to raise the vital funds we need to sustain our public services. Business rates retention is one such opportunity. Under the current business rates retention system, local authorities estimate that they will retain around £2.5 billion in business rates growth this year, which is a significant revenue stream on top of the core settlement funding.

This year, all London boroughs, the Greater London Authority and the City of London are jointly piloting 100% business rates retention. Based on their forecasts, the London pilot pool would retain an additional £348 million compared with the current system. This vital incremental income supports a number of strategic investment projects in London, including investment in high-speed broadband in Harrow and other west London boroughs.

As we confirmed in the provisional settlement, all London authorities, including Harrow, will continue to pilot increased business rates retention at the level of 75% in forthcoming year. I am confident that, when it comes to supporting growth and financial sustainability, Harrow is getting what it needs.

Beyond growth, one of the most undeniably crucial roles that local government continues to play is in helping the most vulnerable in society. It is local authorities that support the elderly, the disabled and our children in need. I am in no doubt about how challenging it has been for councils to drive efficiencies, particularly in the face of growing pressures on social care, as they contribute to rebuilding our economy and tackling the deficit we inherited from the last Labour Government.

I pay tribute to the work of councillors up and down the country, which is why I was delighted that the Budget committed another £1 billion of extra funding for local services, with a strong focus on supporting some of our most vulnerable groups, including £650 million for adult and children’s social care in the next financial year. Of that, £240 million will go towards easing winter pressures, with the flexibility, as requested by councils, to use the remaining £410 million for either adult or children’s services and, where necessary, to relieve demands on the NHS. I am pleased to confirm that, as a result of these payments, Harrow Council will receive an additional £2.63 million in the next financial year. That is on top of the £240 million announced in October to address winter pressures this year, of which Harrow Council received a further £1 million.

I am pleased to say that the focus on this area and the better joined-up collaboration between the NHS and local authorities, through the Government’s better care fund, is paying dividends. Social care across the country has freed up 949 beds a day since the February 2017 peak—a 39% reduction in social care-related delayed transfers of care. I am also pleased that Harrow performed well, achieving a 58% reduction in social care-related delayed transfers of care since August last year, and now has delayed transfers of care levels significantly below the England average.

The Government’s troubled families programme is also making amazing strides in supporting our society’s most vulnerable families. I am proud to say that £920 million has been committed to the programme during this spending period. As of September this year, nearly 130,000 families have achieved significant and sustained progress against the problems identified when they first entered the programme. Some 1,400 families have been working with the programme in Harrow alone during this period, and the council is forecast to have benefited from more than £3 million over the course of the scheme.

We all see that local authorities’ vital work in building strong communities that thrive is beneficial not only to them, but to wider society. Strong communities are cohesive, and it was with that in mind that the Government announced a £100 million fund to help to ease pressures on local services resulting from recent migration. The fund has so far committed a total of £832,000 to Harrow to contribute to better public services and a more cohesive society.