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Local Authorities: Funding

Volume 681: debated on Monday 5 October 2020

What recent assessment he has made of the adequacy of Government funding for local authorities. (907010)

We said we would support councils throughout this pandemic, and that is exactly what we are doing. We have provided £4.8 billion in additional funding for spending pressures, including £3.7 billion of un-ringfenced funding. This is in addition to councils’ core spending power rising by over £2.9 billion this financial year, which is the largest year-on-year real-terms increase in a decade.

The Minister will know that Rochdale council has lost some £200 million in Government cuts over the last years, and this year it is likely to be £20 million short of money, even with the extra Government funding. The people who will suffer most from this are those dependent on acute services, children’s services and, of course, the elderly and the vulnerable. How does the Minister intend to make sure that they do not suffer?

The hon. Gentleman of course knows that this year’s local government finance settlement saw Rochdale Borough Council receive an increase of £12 million this year, which he did not object to when the finance settlement came through the House in February. More widely, throughout this pandemic we have supported Rochdale with £93 million to local councils, businesses and the local area. If Rochdale council is concerned about its financial settlements or about the financial situation, it should get in contact with my Department at the earliest opportunity. I would say that over half of the £4.8 billion allocated to local authorities has been spent on social care, but I am always happy to discuss it with him further.

Councils are facing in-year cuts of around £3 billion because the Secretary of State broke his promise to fully fund councils for the cost of getting communities through the pandemic, and that is according to the Conservative-led Local Government Association. The Minister tries to wish this away by bandying around Government funding intended for specific purposes that cannot be used to plug gaps in the council’s general funds. Since he would not wish to try to pull that same trick again here, would he tell the House which services he now expects councils to cut to plug the funding gap created by his broken promises?

Let us step back and look at the facts here. If we look at the local government finance settlement—the hon. Gentleman did not object to it in February; he supported it—and at the fact that local government has reported a £3.1 billion increase in spending pressures for covid, we have supported them with £4.8 billion, including £3.7 billion of un-ringfenced funding. What is not surprising is the hon. Gentleman turning up again today and talking down councils and their ability to respond to this crisis. Local authorities are proving themselves to be a resourceful, dynamic force, and we should be praising them.

Could I say that the Government’s decision to help councils with loss of funding, particularly for leisure centres, parking revenue and such things, is welcome? There is one group of authorities, however, that have not been compensated—the councils that run their leisure services at arm’s length. I raised this with the Minister’s predecessor back in July, and the response I got was that the Government

“are very serious about tackling it.”—[Official Report, 9 July 2020; Vol. 678, c. 1224.]

Since then, because Sheffield has lost over £10 million, which it has not been compensated for, from its leisure centres’ loss of income, we have written as Sheffield MPs to the Secretary of State twice—once in August and once in September, the second with the local leisure clubs—and we have not had a response. Could the Minister therefore update the House on what is happening in general on this issue, and will he agree to meet Sheffield MPs to discuss this issue, which really affects our city and its finances?

I thank the Chair of the Select Committee for his question. We recognise the vital role leisure centre facilities play in keeping our communities safe and protecting mental health. We are working closely with the Department for Digital, Culture, Media and Sport on a further package of support for leisure centres. I am happy to meet the hon. Gentleman and other Sheffield MPs to discuss the matter.