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Communities and Local Government

Volume 519: debated on Thursday 25 November 2010

The Secretary of State was asked—

Redundancy Costs (Local Authorities)

1. What estimate he has made of the likely amount local authorities will incur in redundancy costs in the next 18 months. (26198)

It is for individual councils locally to determine redundancy policies based on their own circumstances. Decisions about when and how to make and manage work force reductions, including policies on redundancy payments, are rightly for individual councils to make as the employers.

Ministers do not have the first idea what the cost will be to local taxpayers. Is this not a triple whammy, whereby families and individuals lose their services, communities find that provision is taken from them and individuals lose their jobs? Is it not correct that instead of paying for services, council tax payers will have to pay for redundancies for services that are being withdrawn? Is it not a scandal that the Government do not know what the impact will be?

The Government have endeavoured to assist the most vulnerable local councils by increasing the amount of money available in the formula grant that is not ring-fenced, moving more money into formula grant, reducing the amount of ring-fencing and rolling more grants into one. I imagine that when his Government were in office, the right hon. Gentleman would have complained greatly about their removal of working neighbourhoods funding for his city of Sheffield, which will cost the city some £38 million. We will endeavour to find the means to cushion that—

I gather that in the comprehensive spending review the Government allocated £200 million for the capitalisation cost of redundancy payments. I also gather that local authority chief executives and treasurers suggest that the costs might be between £1.5 billion and £3 billion. If they are correct and the Government estimate is much lower than the actual sums involved, what are the Government going to do about it?

Capitalisation, which enables local authorities to treat revenue expenditure as capital and borrow for it is an exception to the accounting rules, so there has always been a need for some control, and capitalisation for a number of streams has never run at 100%. It is also worth bearing in mind that local authorities have been aware for some time that reductions in expenditure were inevitable—they were planned by the previous Government. A shrewd authority will therefore have planned to deal with the problem in advance.

Local government now predicts an 11% cut in council budgets next year, with 140,000 jobs lost and a redundancy bill in excess of £2 billion—not the £200 million originally predicted by Ministers. Is local government right? Do Ministers know, or is the truth that they simply do not care about the public servants they will lay off or the public services that they will lay to waste?

The greatest threat to public services for the future is failure to tackle the unprecedented deficit that the previous Government left us. We are prepared to work with local government to deal with those issues, but the hon. Gentleman and his party clearly have no answers whatever.

Unauthorised Encampments

Local authorities will be responsible for determining the right level of Traveller site provision in their area to meet local needs and historic demands. We will encourage councils to provide sites with incentives through the new homes bonus scheme and grant funding for local authorities to deliver new sites.

Will my right hon. Friend give us some idea of the time frame for the withdrawal of planning order circular 01/06? In the meantime, does he take the view that the Government’s intention to withdraw this circular should be a material consideration at both the planning and appeal stage?

We have certainly stated our intention to repeal circular 01/06 and we shall shortly start consultation on an alternative to it. In the meantime, given that the localism Bill will substantially change planning on these matters, I can say that our intention almost certainly is a material consideration.

Residents of the village of Normandy in my constituency are fed up with the never-ending cycle of encampments on green-belt fields, retrospective planning applications and seemingly unenforceable planning refusals. Does my right hon. Friend really believe that the measures he has described will provide a proper and permanent solution for my concerned constituents?

The short answer to that is, of course, yes.

I am afraid that the policy pursued by the last Government left us in a very difficult position. Let me give an indication of how difficult it has become. I remind Members that in 1997 there were 887 unlawful encampments. That figure was bad enough, but it has now shot up to 2,395. As for the second part of my hon. Friend’s question, we intend to restrict retrospective planning applications substantially.

May I warn the Secretary of State of a new type of unauthorised encampment? In my city of Nottingham, the chief executive of Framework, a major charity for the homeless, warned this week that there would be hundreds of rough sleepers in tents in the woods or in sheds on industrial estates as a result of the swingeing cuts that the Secretary of State has implemented in the Supporting People budget. Will he please think again?

I think that the hon. Gentleman may be a little mistaken. As he will know, the Government have passported £6.5 billion to local authorities to support people, and we expect that money to be passed on to the most vulnerable.

Does the Secretary of State agree that no element of human rights legislation contains any provision allowing antisocial behaviour, or enshrining any kind of right or protection allowing people in unauthorised encampments to participate in such behaviour?

We are trying to achieve a balanced approach. The last policy was unrealistic. To hit the 2011 targets set by the last Government, we would have to wait for a further 18 years because we are so far behind. I believe that that policy was predicated on conflict, whereas we want to ensure that there is firm action on retrospective planning applications and enforcement. We will end the continuous process of appeal on application, subsequent application and stop notice, but at the same time we hope to introduce mainstream provision for Travellers by including provisional sites in the new homes bonus.

Local Authority Funding

3. What representations he has received from local authorities on likely changes to funding from his Department since the publication of the comprehensive spending review. (26201)

I have received a number of representations about the challenging but fair settlement for local government. We will shortly announce details of our proposals for funding local authorities in the provisional local government finance settlement.

The Secretary of State’s failure to stand up for councils in the CSR is having a devastating impact on jobs and services in Rochdale. Provision for the homeless, community centres, adult care and many other services are being cut. The situation is so bad that six Liberal Democrat councillors resigned last week, and yesterday the Liberal council leader stood down. Because of the Secretary of State’s cuts, the local authority is in turmoil. When will he stand up for local government?

I should have thought that the hon. Gentleman would congratulate the coalition Government. We recognise that a number of authorities are more dependent on grant than others. We face a particularly difficult task in relation to Rochdale, as we must bridge just short of £6 million that the Labour Government took from the working neighbourhoods fund, but we will certainly seek to provide that cushion. My advice to the hon. Gentleman is “Go back to Rochdale, put a bit of lead in their pencil, and let them get on with protecting front-line services rather than fighting among themselves.”

Does my right hon. Friend agree, on the basis of the representations that he has received from local authorities, that every progressive authority in the country will have planned for the reductions in expenditure? Does he intend to ensure that councils are able to freeze council tax following the years of rapid increases under Labour?

Absolutely. What was going to happen to local government was well showcased. It was clear from the previous Chancellor’s statement in autumn 2009 and the Budget earlier this year, before the general election, that at least £5 billion was coming out of local authorities and that that would be front-loaded. I would therefore expect prudent local authorities and prudent chief executives to have taken the necessary precautions.

The worst aspect of these cuts to local authority budgets, which amount to 28% in real terms over the next four years, is that they are front-loaded. The hardest hit councils are facing reductions in their grants next year of 14%, 18%, 20% or even more. That means they have to plan their service cuts and redundancies now, so may I urge the Secretary of State to think again about the scale of these cuts or to alter their phasing so that councils are not forced to take what will be very damaging crisis measures?

“As we look forward”, regeneration spending is

“not the biggest priority we face”

as there are “other competing priorities.” I apologise: perhaps I should have made it clear that those were the words of the now Leader of the Opposition, speaking on the Radio 4 “Today” programme on 12 April, just before the general election. That is the dilemma. The Opposition have a blank piece of paper. They oppose everything when they know, as we know, that they were going to impose £5 billion of front-loaded cuts on local authorities.

May I ask the Secretary of State to join me in congratulating my council, Dudley metropolitan borough council, on engaging in discussions with Wolverhampton, Walsall and Sandwell councils about rationalising services and reducing back-office costs without affecting front-line services?

I have to say that that is the future of local government. We expect local authorities to merge services and to protect the front line. Prudent councils are doing that. Councils that are more content to use the poor and the vulnerable as a battering ram against the Government will seek to protect the centre and not seek to protect front-line services, whereas good councils will protect the front line.

Local Authority Powers

In six months, the coalition Government have ended the ring-fencing of all but two revenue grants, simplified over 90 separate funding streams for local government to fewer than 10, scrapped comprehensive area assessments and abolished 4,700 central targets on local government. The localism Bill will give many more new powers to local councils, including a general power of competence. This Government are reversing decades of top-down control, which has led to Britain being one of most centralised countries on the planet.

The Minister may be aware that, in responding to his Department’s recent paper on proposed changes to social tenancies, Councillor Richard Kemp, leader of the Liberal Democrats in local government, described the proposals as “an irrelevant fantasy” and added:

“No council with any sense of the realities on the ground is going to be interested in this”.

Does the Minister—and, perhaps more interestingly, do his coalition partners—agree?

The consultation my right hon. Friend the Minister for Housing and Local Government has launched has been well received across the sector because it introduces a right, not an obligation, and when we have a homelessness crisis, I think it is right to give registered social landlords more flexibility than they currently have in allocating to homeless tenants.

Like many other local authorities, South Lakeland district council would desperately love the autonomy to be able to scrap the second-home council tax subsidy, which costs the council tax payer in South Lakeland £1.25 million every year. At this time of hardship, difficulty and restraint, is it not time to look again at whether we should give a 10% subsidy to those who can afford it the most?

We have made a lot of progress already. My hon. Friend is right that localism involves there being greater control of resources locally. A further set of measures will be considered in a review that will start in January, and I will make sure that his proposal is considered in that.

The Minister for Housing and Local Government was not in the House on Monday to answer questions on the housing consultation paper so, while we are on the subject of devolving powers, may I ask his colleague about this? The Government have repeatedly said that they will not allow social landlords to change the rights of existing tenants, yet question 13 of that consultation leaves the door wide open for them to do exactly that in the future. Can this Minister give the House a personal guarantee that the Government will not now or in the future permit changes to the rights of existing social tenants?

Local Authority Expenditure

10. What recent steps he has taken to increase transparency and accountability in local government spending. (26208)

We are replacing bureaucratic accountability to central Government with democratic accountability. People should be able to hold their local council to account over the taxes it spends. More and more local authorities are publishing details of spending items of more than £500 online. Next month, I will consult on a code of recommended practice for local authorities, which will address issues such as scope, formatting and timings for publishing data.

Although I do not want to add to the administrative burdens of local authorities, it would be useful to have data against which performance, quality and reach of services, and efficiency could be measured. What tools will be made available to this House and the public to do that?

It is most important that we continue to press ahead with the agenda and, in particular, with the public right to know how money is being spent. It is no use talking about cuts in public spending and cuts to front-line services when we find that we have excessive pay among chief executives and excessive numbers of middle management, and that local authorities are not offering value for money. So the important thing is that all authorities will put this online. I have to tell my hon. Friend that the Portsmouth, Great Yarmouth and Norfolk authorities have not put these amounts online. I hope that she and my hon. Friend the Member for Great Yarmouth (Brandon Lewis) will urge them to do so.

I thank my right hon. Friend for that. I know that Great Yarmouth’s authority is set to go live with this online in January. Does he agree that having the new transparency in place will mean that voluntary sector organisations and small businesses across the country will have a much more even playing field when bidding for contracts?

Yes, and we will be taking this a step further: not only will voluntary organisations be able to compare the costs and the spending, and the public will be able to judge those, but in the new localism Bill we will give voluntary organisations the right to bid for services and to run them directly if they can produce them better and more cheaply than local authorities.

What plans does the Secretary of State have to encourage local authorities to publish the expenditure that they are undertaking on big society projects? If he has plans to scope out that expenditure, could that report contain a particular section on funding for citizens advice bureaux? The representations that I am receiving suggest that they are going to get a hammering as a result of his funding settlement.

They should not get a hammering, as that would be foolish of local authorities. That applies whether the authority is Labour, Liberal Democrat, Conservative or hung; it applies to councils of whatever colour. If local authorities seek to deal with this country’s financial crisis by simply paring back on grants, salami slicing and taking X% out of all departments, they will fail. They have to restructure, they have to change and they have to share services. If they do not do that, they will rue the day when they cut back on Citizens Advice and similar voluntary organisations.

On the issue of reporting expenditure to central Government, and pursuant to the Secretary of State’s previous answer about protecting the front line, has Westminster council informed him of its intention to close a disability centre that provides luncheon facilities and a hydrotherapy pool to many severely disabled people, many of whom are also losing their levels of care services, as they, too, are being retrenched?

I will look into that issue and write to the hon. Lady. I have to say that Westminster council has a fantastic record in dealing with vulnerable people, but I will look into the specific case.

Localism Bill

The localism Bill contains a wide range of measures to shift power from central Government into the hands of individuals, communities and councils. The Bill frees local government from central and regional control and strengthens local democracy. In addition, it gives greater power over planning, housing and other services and allows councils and councillors to be better held to account. The Bill will be published imminently.

I thank the Minister for his response. May I ask him to go into a little more detail on how the localism Bill, through empowering local people, will help protect the green belt in my constituency of York Outer?

Of course. One of the real opportunities in the localism Bill is to remove the threat to the green belt that comes from the regional spatial strategies. The concern up and down the country that green belts could be deleted through those strategies will be buried once and for good by the localism Bill.

I was pleased to hear the Secretary of State confirm that material consideration should be given by councils to circular 01/06 on Gypsies and Travellers, although some, including mine, have not been doing so. May I ask the Minister to outline what benefits that will present to neighbourhoods and to villages such as Welford-in-Avon in my constituency?

The Leader of the Opposition has said that the previous Government looked down their noses at local government. Nowhere was that more true than in the case of parish councils. The charge of parochialism needs to be turned round and we need to regard an interest in locality through parishes as a positive measure. The localism Bill will allow parishes, as neighbourhoods, to set their own plans, to have them adopted and to give effect to them in the planning system.

May I ask my right hon. Friend to go a bit further on the role of parish councils? Skipton and Ripon is packed with hundreds of excellent parish councils and they are asking me what specific role they have in relation to district councils. Will he go into a bit more detail on that?

The planning provisions in the localism Bill will allow every neighbourhood in the country, including parishes, to set its own local neighbourhood plan. That will mean that they can design the look and feel of their neighbourhoods going forward into the future and in so doing take away the bureaucracy that is involved in taking planning applications through the development control process. If we capture it in the plan, we will not have that bureaucracy and uncertainty.

I welcome the Government’s commitment to include local referendums in the localism Bill. Does my right hon. Friend agree that if the results of those referendums are not binding, their status will be only marginally higher than that of an ordinary petition, although they will be a lot more expensive? Will he bring in proper referendums that are legally binding?

I know that my hon. Friend is a great champion of referendums, as he has organised one in his own constituency. The localism Bill contains binding referendums on subjects such as whether to introduce mayors, the neighbourhood plans that I mentioned earlier and excessive increases in council tax. It also contains provisions for advisory referendums that will test public opinion and can influence policies. Sometimes it is appropriate to nudge councils to do the right thing. This will be perhaps more of a shove than a nudge, and I think it will be difficult to ignore.

How can the Minister keep a straight face when he talks about localism and local democracy when later today his Government will ram through legislation to take away that local democracy from Exeter and Norwich with our recently restored unitary status?

I am advised that the right hon. Gentleman did not even table an amendment to the Bill, such is his commitment. I shall stand corrected if I am wrong. During the previous Government’s time in office, this country became one of the most centralised countries. We want to revive local democracy by transferring power from central Government to local government and down to communities. We will take no lectures from the Opposition, who have driven that centralisation.

What discussions has the Minister had with the Welsh Government on devolving extra powers to the National Assembly under the localism Bill?

We have had discussions with the Welsh Assembly Government. Clearly, if we want to devolve powers to the lowest possible level, those discussions will vary according to the different provisions in the Bill. It is quite a detailed matter and the hon. Gentleman will see the outcome of the discussions when the Bill is published.

Will the Minister say what proportion of local expenditure should be raised locally, thereby bringing direct accountability to local communities on delivering localism?

I do not think it is terribly localist to prescribe what that percentage should be, but it is right that as we take a more localist direction, we want a greater connection between the behaviour of local councils and the revenue being raised. That is the direction in which we are going, but it would be wrong to prescribe a percentage.

Two weeks ago the High Court ruled that the Secretary of State acted unlawfully when he scrapped regional housing plans, comparing him with Henry VIII. His Majesty’s reply was that it did not matter because the Government were going to abolish them in the localism Bill anyway, but that could take nine months to become law and the confusion that the Government have created has undermined the construction industry and led local councils to ditch 1,300 new homes every day. Will the Minister confirm that, in the mean time, local councils should get on with supporting the construction of the homes that the country so badly needs?

The right hon. Lady makes a mistake that afflicted the Government of whom she was a member—the fatal flaw of confusing plans with homes. In many cases there was an inverse relationship: the higher the target, the lower the number of homes actually built. That is why we want to reform the planning system. The Government’s intention has been absolutely clear. There is not a councillor, planner or developer in the country who does not know that the regional strategies are on the way out and will be buried and interred for ever.

Local Authority Funding

8. What his policy is on the distribution of reductions to local authority funding over the comprehensive spending review period; and if he will make a statement. (26206)

It would be rational to accept that the size of the front-loaded cuts coupled with the council tax freeze in the first year will create a huge problem for even prudent local authorities, necessarily giving them less time, less flexibility and less chance of saving front-line services. Does he agree?

No I do not. I draw my hon. Friend’s attention to the fact that we have proceeded at a rapid rate with de-ring-fencing and breaking down the silos between different funds coming to local councils, reducing the number from more than 90 to around 10. We are also putting large sums of money at the disposal of local authorities. I also want to draw his attention to the option that local authorities have of raising their council tax income by up to 2.5% and receiving a compensatory grant so that their residents do not have to bear that cost, thereby protecting residents and giving councils the opportunity to generate more revenue.

The Treasury’s green book confirms that funding for local councils will be cut by 28% over the next four years, but the spending review framework document says that the Government will limit the impact of the reduction in spending on regions that are heavily dependent on the public sector. As we are all supposed to be in it together and in order to ensure fairness will the Minister confirm that the cuts faced by local councils will be based on their total budget requirement and not on their formula grant? As he knows, the formula grant accounts for up to 80% of the budget requirements of some councils and less than 20% of others.

The hon. Gentleman is quite right that the picture is very complex. That is why when the settlement comes, he will see that the Government have responded to the points he has raised.


On 8 November I published an online guide for home owners affected by squatters, setting out the rights and action they can take. We are also taking steps to help get empty homes back into productive use and will be helping to reduce the scope for squatting by doing this.

I thank the Minister for that answer, but we have some long-established squatters in Parliament square. What are we going to do about them?

As the Prime Minister said yesterday, the Government share the concerns about the current state of Parliament square. I can inform the House that we intend to introduce legislation shortly.


The Government are committed to tackling and preventing homelessness. We have established a cross-departmental working group on homelessness, taking in eight Departments, and the homelessness grant has been fully protected at £400 million.

Does my right hon. Friend believe that the Government could learn lessons from the recent successful scheme by the charity Broadway, which got a number of long-term homeless people off the streets and into their own accommodation at an average cost of £794, compared with the many thousands of pounds spent on them while they are on the streets?

My hon. Friend is absolutely right. The Broadway scheme is excellent and innovative. It has taken funding and allowed the people who are involved with homelessness provision and the service users to decide how best to use it. I congratulate Broadway, which has managed to get a lot more done for £794, rather than the average of £3,000. It is an excellent scheme from which others can learn.

Will the Minister confirm whether now or in the future he plans to reduce homelessness by changing either its definition or the categories of people who are entitled to assistance and re-housing because they are homeless?

We have no plans whatever to change the categories of reasonable preference—those categories that councils have to take into account in order to state whether somebody is homeless and, therefore, provide statutory help. We have already changed the terms—the measurement—of homelessness as defined by rough sleeping, which, under the hon. Gentleman’s Government, meant that there were only 440 people sleeping rough on the country’s streets. We discovered very quickly, once we had counted such people properly, that there are actually 1,294.

New Homes Bonus Scheme (Milton Keynes)

13. If he will estimate the proportion of the funding for the new homes bonus scheme which will be spent in Milton Keynes. (26211)

The new homes bonus will match-fund the same amount of council tax for every single home built for an additional six years, and we have published a very helpful calculator on the Department’s website, where people can go today to find out how much they will get for the additional homes built.

I warmly welcome the new homes bonus, which will go a long way to providing the infrastructure that new housing estates need, but will local authorities have the discretion to use that bonus for capital and revenue items?

The new homes bonus is available for local authorities to spend as they see fit. Under the localism Bill and the flexibility that we now provide, it is absolutely possible for local authorities to use that money potentially even to borrow against, because the income stream is guaranteed for six years. It is a simple, very straightforward approach to making sure that people get more money to their area. To give Members an indication of the calculator, I should say that for every 100 homes that are built in any given area £1 million is likely to go to it over the six-year period.

Milton Keynes and Slough are both in the same region, and they both face similar issues, because the homes in their areas are more likely to be in a lower council tax band than the homes in neighbouring areas. Is it fair that those neighbouring areas, which build bigger, richer houses, will get more money than places such as Milton Keynes and Slough, which have more band D places?

We can usefully draw out a couple of points from the consultation that is before the House. First, we have set the banding equally throughout the country, so a band D home represents the average band D home throughout the country. Secondly, bigger homes obviously take up more space, so people will get less money because they cannot build as many. Thirdly, the hon. Lady will be interested to know that we have over-compensated for affordable house building, ensuring that every single affordable home that is built will get more than £350 in additional money. That represents a figure of more than 125% for every affordable home built. We should get more built—

Community Ownership (Assets and Facilities)

The Government will make it easier for communities to take on community assets through the community right-to-buy provisions in the localism Bill. Practical help is already available from the Government-funded asset transfer unit and from the Communitybuilders programme, and the big society bank will step in to help social enterprises and voluntary sector organisations early next year.

Does the Minister agree that the Government need to do more to empower communities to improve their local areas and take over amenities, such as community centres and allotments? What steps will the Government take to ensure that those initiatives are taken up in the forthcoming localism Bill?

First of all, I commend Wirral borough council for setting up its own fund for the transfer of community assets and for making the launch of those much more feasible. I hope that other local authorities will look at that example.

The community right to buy will be a powerful option for neighbourhoods and community groups that want to take on assets, and that will be backed by money. The asset transfer unit and Communitybuilders, a project lasting through to 2014, will be there to provide support. I also want to make quite sure that the House understands that the big society bank will be there to assist as well.

Empty Homes

My hon. Friend’s question is well timed, as it is empty homes week. I am sure that there will be concern right across the House at the fact that there are currently 738,000 empty homes in this country and that more than 300,000 of those have been vacant for six months or more. They are a blight on the community and a waste of housing that we cannot afford.

The coalition agreement says clearly that we are planning to tackle the issue, and we have made the first steps. We intend to provide £100 million over the spending review period to bring empty homes back into use—that is a tripling of the money contributed by Labour in the last comprehensive review period. We are consulting on how the new homes bonus can also be used to bring more homes back into use.

In Hastings, more than 2,300 families are on the housing waiting list and there are more than 800 empty homes. Has the Minister considered whether there is any additional incentive that we can give to councils to try to bring the more difficult properties, which have been empty for more than two years, back to productive use, as against the slightly easier properties, which have been empty for six months?

Every effort needs to be made by local councils. They have some statutory tools at their disposal—statutory improvement notices, enforced sales and the empty dwelling management orders. However, I hope that the fact that we are tripling the investment for bringing empty homes across the country back into use will give my hon. Friend some assurance that we are serious about the issue and will work with local authorities to deliver a much improved record.

I am glad that you have mentioned that there are 738,000 empty properties, many of them long-term empty. Can you give some quantitative indication of—

Order. I can give no quantitative indication at all, but the Minister might be able to. Carry on.

Sorry, Mr Speaker. Can the Minister give a quantitative indication of the extent to which he hopes to reduce the figure over the period—100,000 or 200,000? By how much will he reduce it?

Some £100 million is intended to assist in bringing back 3,000 empty homes into use, and that is direct financial support. I draw the House’s attention again to the impact that the new homes bonus can make in increasing that, and there are of course the statutory levers that local authorities should use to make sure that the blight of empty homes is reduced.

I welcome my hon. Friend’s remarks about the new homes bonus. However, will he go a little further and confirm that that bonus will be payable to local councils that bring empty properties back into use, so that councils such as Basildon and Thurrock can benefit from the measure?

I draw my hon. Friend’s attention to the fact that this is a matter on which we are consulting. We have that intention, and I hope that he will write and encourage us to carry forward that proposal.

Residential Property Tribunals (Park Homes)

18. By what date he expects the residential property tribunals system for park home owners to be in full operation. (26217)

First, I congratulate my hon. Friend on her staunch work on behalf of mobile home owners. Subject to parliamentary approval, we expect residential property tribunals to begin hearing cases under the Mobile Homes Act 1983 in spring next year.

I very much welcome the Minister’s response. However, I am sure that he is very much aware that it will not address some of the appalling practices to which some park home owners are subjected. What further action will he set in motion?

As my hon. Friend knows, I attended the lobby that she organised, and I have absolutely no doubt about the serious problem that residents face with a small minority of rogue landlords. We need to see how the Tribunals Service can deal with these complaints and matters. Certainly, we shall be looking very hard to see what progress we can make. The Minister for Housing and Local Government is looking at a range of measures that will help to combat the mismanagement and abuse that some residents face, and he will shortly make an announcement on his plans.

First-time Buyers

19. What estimate he has made of the change in number of first-time buyers in the housing market in the last 12 months. (26218)

According to data from the Council of Mortgage Lenders, the number of first-time buyers has fallen slightly over the past 12 months, by around 5% in total.

Is the Minister aware that those figures are among the worst ever for first-time buyers? Is he further aware that the calculations put out by the British Bankers Association on Tuesday of this week show that the level of new mortgage approvals is at its lowest for 19 months, and that the level for gross mortgage lending is the lowest for 10 years? This is a disastrous situation for hundreds of thousands of young couples who want to get into the housing market. What is the Minister going to do about it?

The hon. Gentleman is absolutely right in that analysis; I completely concur with it. It is a disaster for first-time buyers. One of the first things I did as Housing Minister was to reverse the policy of the previous Minister to say that I believe in the aspiration of people owning their homes. The reason we ended up with this problem in the first place is related to the enormous deficit and boom and bust, which was led by housing in particular. We need a more stable economy in place—not like the one that we were headed for or like the Irish one, but one that is stable for the long term. That means that cutting the deficit is the No. 1 move. I am also very aware that there are effectively only five lenders on the high street, which means that there is very little competition for first-time buyers. The banking review will report next June. It is very important that competition is opened up and we reverse the situation for first-time buyers.

Topical Questions

This week my Government will be co-operating with interfaith week, celebrating how faith communities are adding to the well-being of our society. We have published details of our plans to build 150,000 more affordable houses over the next four years. We have welcomed the decision of the Local Government Association’s chief executive to take a cut of £200,000 a year, and we hope that more town hall chiefs will follow his example in these austere times.

At the 2010 British curry awards, the Government paid tribute to the spice industry’s £4 billion turnaround—a real bhuna for the British economy. From bin collections to small business tax relief, we will do our utmost to ensure that Britain’s curry industry is second to naan.

Sorry, Mr Speaker, I can hardly follow that.

The proposal to refund 2.5% of income to councils freezing their council tax next year, which was touched on by my hon. Friend the Member for Derby North (Chris Williamson) and the Under-Secretary of State for Communities and Local Government, the hon. Member for Hazel Grove (Andrew Stunell), will have the perverse outcome, will it not, of top-slicing the money from all councils and then rewarding the wealthiest, high rateable value authorities such as Surrey twice as much as the poorer low rateable value authorities such as Hull, Newcastle or Sheffield? Given that those three councils are Liberal Democrat-controlled, will the Secretary of State tell me which conjuring trick he managed to do in persuading the Deputy Prime Minister and his colleagues that this was fair or even acceptable?

I am sorry to tell the right hon. Gentleman that he is wrong about the top-slicing. It is in fact new money, and we will not be top-slicing the authorities. I face a great dilemma. As the money that each local authority has varies, the grant differs considerably; he alluded to that. The particular problem I face is the decision taken by the Labour Chancellor to remove £300 million from the working neighbourhoods fund, which will hit Sheffield particularly hard. At the moment, I am trying to ensure that Sheffield and all those authorities are cushioned against Labour cuts.

T3. Mindful of the recent floods in Cornwall and the fact that from April next year, upper-tier and unitary authorities will have responsibility for flood risk management strategies, will the Secretary of State confirm that money for that purpose will be guaranteed in the comprehensive spending review? Will he please apply planning policy guidance note 23 to inappropriate developments on floodplains? (26226)

Our colleagues in the Department for Environment, Food and Rural Affairs remain committed to funding fully local authorities’ new burdens under the Flood and Water Management Act 2010. Up to £36 million a year in total will be provided directly to lead local flood authorities for all those new burdens, and in addition local authorities will spend money supported by formula grant from our Department. I will certainly consult my colleagues on the PPG to which my hon. Friend refers.

It is not really turning out to be a very good day for the Secretary of State, but you know what, it has not actually been a very good fortnight since he told council leaders on 6 November that talk of front-loaded cuts was “fiction”. Now it seems that reality is beginning to dawn on him. According to a report in the Local Government Chronicle, he has been attending emergency meetings with the Treasury to plead for more money to mitigate the effect of those cuts, which could mean some councils losing up to 20% of their funding by April 2011. Whether or not it is true that the Secretary of State has been lobbying the Treasury to come up with more cash, may I urge him to start listening to the concerns of local government and ensure that councils get a fair deal that stops the damage caused by the heaviest cuts falling in the first year?

I am sorry to say to the right hon. Lady that I have not necessarily found the Local Government Chronicle a very accurate reflection of what is going on in my Department, ripping read though it undoubtedly is. I must also admonish her in the mildest possible terms for using a partial quote. What I said was ridiculous was the idea that councils would face a 20% cut in their total spending ability in the first year.

The right hon. Lady has to recognise that she needs a policy. She knows, I know and the House knows that the Labour party Government were going to impose £5 billion-worth of cuts on local government, which would have been front-loaded.

T4. Analysis of the impact of reforming the formula grant on concessionary travel support suggests that most of the options currently being considered have urban-centric criteria and therefore could lead to more money going to urban areas and less to rural areas. What assurance can my hon. Friend the Minister give to places such as Cornwall, which rely on concessionary fare support, that they will not be disadvantaged by the changes? (26227)

I understand very well the concern that my hon. Friend raises and the importance of the issue, particularly for shire districts. He is right that we have consulted on that, and we are considering the results of that consultation. I have to ask him to be patient, because we will announce our proposals for the local government finance settlement in the usual manner in due course.

T2. What incentive does the Minister think cities such as Southampton will have, under the terms of the new homes bonus, to avoid losing millions of pounds of housing funding by having to build more homes each year than have been built in the city since the aftermath of the second world war, and on land that, because of the urban nature of such cities, does not actually exist? (26225)

The hon. Gentleman raises an interesting point, because people often say that more homes cannot be built in a city, so perhaps the new homes bonus will not operate there. Interestingly, however, when I go to some of the most crowded places, such as Kensington and Chelsea or Westminster, I am told that even those areas have space to build and will benefit greatly from the bonus. I recommend that his local authority looks for some of the space it has and gets building.

T5. Will the Secretary of State inform the House what guidance there will be following the proposed revocation of planning circular 04/07 to inform local authorities such as mine in Selby about planning permission for travelling show people or others wishing to develop land for use as a permanent site for travelling show people? (26228)

I have had a meeting with the Showmen’s Guild of Great Britain, kindly organised by the hon. Member for Central Ayrshire (Mr Donohoe) and my hon. Friend the Member for Northampton South (Mr Binley). We talked about what would replace those planning guidelines, and we will do our best to meet what the guild is looking for—sensible co-operation with local authorities.

T6. Many small voluntary organisations in my constituency that provide services to the most vulnerable, such as Durham Action on Single Housing, are extremely concerned about their futures following local government cuts. What will the Minister do to ensure that homelessness does not increase in my constituency and elsewhere as a result of the cuts to local government spending? (26229)

It is very important that every local authority reflects on the contribution that the voluntary sector can make. We are decentralising funds from central Government to local government, and I expect local government not to draw up the drawbridge, but to treat voluntary organisations fairly and, indeed, to allow them greater access so that they can provide more services than they currently do.

T8. The Secretary of State recently visited the Nine Elms development area, which includes Battersea power station in my constituency. We talked about the importance of tax increment financing being available to councils involved in major regeneration projects. Will he press for TIFs to be brought in as soon as possible? (26231)

I thought the development was very interesting. It will transform the south of the river; indeed, Members of the House will be able to look across to one of the more exciting developments in our capital. I very much recall my visit, which was just before my right hon. Friend the Deputy Prime Minister announced our intention to move forward on TIFs at the Liberal party conference. We will be including this in the localism Bill, which will be introduced in this House very soon.

T7. On Monday, the Government set out plans to reform social housing, including the scrapping of guaranteed long-term tenancies. These reforms have been described by leading charities as “a deliberate attack on the poorest in society”.Does the Housing Minister agree with the deputy leader of the Liberal Democrats, who said of the Government’s proposal:“it is not a Liberal Democrat policy, it is not a coalition policy, it was not in the election manifesto of either party, it was not in the coalition agreement…our party would need a lot of persuading that it has merit”? (26230)

I am grateful to the hon. Lady for raising that, because a lot of misinformation has been put about on these reforms. For one thing, on the flexible tenure—the idea that a tenure from two years could be provided—we are thinking about special cases, such as that of my constituent Matthew Hignett, who was paralysed from the neck down after a motorcycle accident. He cannot apply under any of the current rules for social housing, but thanks to flexible tenure—because we are making the system more flexible—he will now actually get the help and assistance that he requires. Some of the charities have made comments on that, but some, such as the YMCA, have said that they appreciate and welcome flexible tenure, so, no, I do not agree with the hon. Lady’s comments.

My constituents welcome the fact that Milton Keynes council will become the sole planning authority for the city, but they are concerned that some of the assets currently controlled by Milton Keynes Partnership may not be used for community purposes. Will the Minister meet a delegation from the city to discuss some innovative ideas about how those assets could be used?

It is always a pleasure to meet my hon. Friend, and I look forward to meeting him and representatives from Milton Keynes in due course.

T9. What support will the Secretary of State give the campaign that I am launching to ensure the retention in Retford of the full-time fire station and service, which has been there ever since the inception of local government? (26232)

It is for individual fire authorities to decide the manning levels and the nature of the duty systems at fire stations, consistent with their obligations under fire services legislation and their integrated risk management programmes. It is not for the Government to interfere, because those authorities are best placed to assess the needs, priorities and risks in their areas.

Will the Minister confirm whether the requirement on local authorities to front-load the budget reductions is in any way connected to the protection of the Olympics budget?

What steps did the Secretary of State take within the Government to protect communities in London and the south-east that have not been able to take advantage of the national insurance holiday that other areas have enjoyed, precisely because they were more, rather than less, reliant on public sector workers? Surely, that must have stuck in the Secretary of State’s craw just as much as it did in mine.

There needs to be consistency from Opposition Members. They cry, “What are the Government doing to help the north of England?” but the national insurance holiday is a tangible measure that the previous Government were unable to take. The hon. Gentleman should congratulate this Government. After all, only when we get through the reduction in public expenditure and get our economy back on to an even keel can we look forward to—

The Government inherited the FiReControl contract from the previous Government. As I have indicated to the House already, we have concerns about the contractor’s persistent delays in delivery. In consequence, on 8 November, we placed the contractor in material breach, which requires a response within 20 working days.

In October, the Secretary of State told the House that it was outrageous for me to suggest that the money announced in the comprehensive spending review for elderly care would be wiped out by overall cuts to local government. Will he tell me what he disagrees with in the London Councils’ estimate that overall funding, in relation to the personal social services budget, will decrease by £885 million, or including inflation, £1.8 billion?

I think that the London Councils’ analysis is overblown, and that it errs a little on the side of hysteria. Let us be clear. What we know is that the local government settlement is £6.5 billion for Supporting People, and, for care for the elderly, for an extra £2.2 billion will come directly from the NHS.

Further to my questions in the House, the Secretary of State has challenged local government to get its house in order on executive pay-offs. Will he therefore commend the approach taken by Bristol city council, which has applied a cap of £700 per week in redundancy payments for each week’s pay in the settlement? That has cut redundancy costs by 30%, and it affects only the highest paid 10% of the work force.

It is absolutely right that Bristol council has used existing flexibilities to reflect the circumstances that apply to it. That is the right approach, and why, as I indicated in relation to a previous question, it would be inappropriate for the Government to restrict the ability of local authorities to respond to their own circumstances in such matters.