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Local Government Funding

Volume 644: debated on Tuesday 3 July 2018

7. What discussions he has had with the Secretary of State for Housing, Communities and Local Government on changes in the level of funding for local government since 2010. (906195)

It is right that money that is spent locally is raised locally. In 2010, councils were 80% dependent on central Government grants; by 2020, the vast majority of money spent locally will be raised by local councils.

The County Councils Network warned this week that

“the worst is yet to come”

for local government and that several authorities risk going bust. A survey of its members revealed that two thirds will struggle to balance their budget by 2021 unless more funding is made available, estimating the funding gap at £3.2 billion over the next two years. Is the Chancellor aware of the effect his austerity agenda is having on local services? Will he take responsibility for ending this crisis in our local councils?

As I said, we have moved from a situation in which local councils were majority funded by central Government to one where local councils are accountable for the money they spend and raise locally. We have given councils the extra ability to raise funds. I note that many councils have reinvented themselves, are doing things differently and are saving money, and public satisfaction with local services has held up.

I declare my interest as a member of Kettering Borough Council.

By when do the Government expect to publish the conclusions to their fair funding review of local government?

Eight failed years of austerity have meant poor levels of funding for local government. In fact, today the Local Government Association reports that, by 2020, councils will have had £16 billion of funding cuts. With low pay, woeful productivity, tenuous job security, stubborn inflation, rising national debt, a huge deficit, a sinking pound, creaking public services, decaying infrastructure and chaotic railways, what other wheezes does the Chief Secretary have up her sleeve to wreck the economy further?

We are building. We saw a record number of new businesses started last year. We have record levels of employment across our economy. We have brilliant Conservative Mayors, like Andy Street and Ben Houchen, who are attracting new businesses to their areas and redesigning their port infrastructure, whereas Labour councils across the country are doing things like closing down Airbnb, trying to stop Uber and trying to stop progress.

Yes, that told me. It gets worse, if that were possible. This year, business investment growth is slowing, annual export growth is slowing, service sector growth is slowing and economic growth is slowing. With Brexit looming and punch-ups in the Cabinet, should the nation’s economic future really rest in the hands of a go-slow Government?

Given that the hon. Gentleman’s stated policy is to have a run on the banks, I suggest that our ideas for bringing in business investment are doing a lot better for Britain.