HC Deb 25 May 2000 vol 350 cc1180-6

Motion made, and Question proposed, That this House do now adjourn.—[Mr. Dowd.]

5.18 pm
Mr. James Clappison (Hertsmere)

I am pleased to have this opportunity to raise Government funding for persons with learning difficulties in Hertfordshire , which is a subject of great interest to my constituents and more widely in Hertfordshire.

Before I deal with that matter, I must make two things clear. First, Hertfordshire has a good tradition of meeting the needs of people with learning difficulties through the work of voluntary groups. It is in large part due to the work of such groups that people with learning disabilities make a positive contribution to the community in Hertfordshire and are valued members of it. I pay tribute to all those who work in voluntary groups in my constituency and throughout the county.

I wish to explore whether Hertfordshire county council receives an appropriate level of support through the arrangements for providing support for local government from central Government. The Minister and her Department have received communications from Hertfordshire county council on this matter. The council has carried out a great deal of work; it recently commissioned a report from PricewaterhouseCoopers on demand for learning disability services in Hertfordshire. The report included some technical detail about the standard spending assessment.

Hertfordshire county council contends that the SSA does not adequately reflect demand for services in the county and that, as a result, the council spends more than its SSA for personal social services. The starting point for that situation is that, compared with other local authorities, there is a high incidence of people with learning disabilities in Hertfordshire. National research shows an indicative population for people with learning difficulties—irrespective of whether they receive local authority support—of about 3.75 to 4.04 per thousand of the general population. However, in Hertfordshire, that proportion is exceeded; the ratio is 6.61 per thousand.

According to Department of Health records, the number of local authority supported residents with learning disabilities in Hertfordshire is above average; there are more than seven such residents per 10,000 of the population. Those figures do not take account of the significant number of people from long-stay institutions who have been placed in local authority residential care under the provisions of the National Health Service and Community Care Act 1990. I should make it clear that such people are funded by the health authority and thus do not enter the general argument, although they may provide part of the explanation as to why Hertfordshire has a high incidence of people with learning disabilities.

The number of people in Hertfordshire who have moved to local authority residential care from long-stay institutions is high because of the preponderance of such institutions in the county—many of them in and around my constituency. That is a historical feature of the region. Although those people are funded by the health authority, it is possible that, as their disabilities become more complex and severe with age, they will make additional calls on the Hertfordshire personal social services budget. At present, they are funded under the 1990 Act. In any event, quite apart from those people, demand for residential placements for people with learning disabilities is set to grow at a relatively high rate—as the report from PricewaterhouseCoopers established.

That is the picture of need in Hertfordshire. How well does Government funding help Hertfordshire county council to address it? Of course, revenue support grant is distributed to local authorities through the SSAs. In this case, it is divided into seven service sectors, of which the relevant one is that for personal social services. That SSA has four categories—I do not want to go into them too deeply, but I must touch on some of the technical detail in order to make my argument.

The first three categories comprise children's services and elderly residential and elderly domiciliary services. The fourth—the important one for my argument—is described as "other services" by the Government; it covers the provision of services for people aged between 18 and 61, including people with learning disabilities.

In the first three categories, the SSA follows the client group for which the service is provided. Research work has been carried out to identify the relationship between need and expenditure in those cases. However, in contrast, the SSA for the fourth category, which includes people with learning disabilities, does not follow the client group; it follows certain broad socio-economic indicators—reflecting economic and health factors and accommodation provision.

I do not want to get too technical about the issue, but the underlying point is that funding from central Government for people with learning disabilities is not distributed on the basis of potential client group numbers and the need for the local authority to incur expenditure on that client group. To put it more broadly, because of the formula controlling distribution, money does not follow the needs that it is supposed to address.

I do not want to go into any more detail, but I invite the Minister to consider the research that has been prepared by Hertfordshire county council in support of its case. The report makes the argument on strong, robust and technical grounds that the SSA formula does not reflect the relative need that local authorities may have for client groups, including people with learning disabilities. It also points out that the issue will become increasingly important as demand for residential places grows. It suggests technical ways in which the SSA can be reformed to reflect need.

My contention is that Hertfordshire loses out on funding that should go to people with real and important needs—those with learning disabilities in my constituency and the rest of Hertfordshire. As matters stand, according to the leader of Hertfordshire county council, Mr. Robert Ellis, it may be that Hertfordshire loses out by as much as £9 million to £10 million each year.

Against that background, I hope that I have taken a realistic attitude. I know that it is a technical and complicated matter that presents difficulties for the Government, who have to take account of a wide range of issues. Hertfordshire county council is conducting further research, but I hope that the Minister will suggest that she is at least able to consider the possibility of further research by her Department and that she will consider favourably any request by the council for help with its research and, particularly, for help with the collection of data to support its contentions.

I hope that the Minister will have an open mind towards the possibility of further studies. I understand that that does not necessarily entail any Government guarantees about the conclusions on the SSA, but they should at least consider the research. Hertfordshire county council has done some good work and it has made a strong case that is supported by robust and well argued research.

I hope that the Government are willing to listen to the council, which speaks on behalf of an important section of the community that is much valued in my constituency. People want to help, but they wonder whether those in that group are receiving the help that they should receive from central Government through funding for the important services that have to be provided for them.

5.28 pm
The Parliamentary Under-Secretary of State for the Environment, Transport and the Regions (Ms Beverley Hughes)

I congratulate the hon. Member for Hertsmere (Mr. Clappison) on securing the debate and on giving us an opportunity to consider the financing of local government in Hertfordshire and to set the record straight on some of the points that he made.

The hon. Gentleman knows that the financing of local government for this year is settled, but I accept that he has spoken largely about the future. In February, the House approved the distribution of revenue supports grants, and local authorities, including Hertfordshire, have decided their budgets and set their council taxes. In that sense, the settlement is fixed for this year.

I remind the House that, this year, the settlement has increased support for local government by much more than the rate of inflation. It is important to bear that context in mind. We have provided 5.8 per cent. more in grant for local authorities this year on top of a 5.5 per cent. increase the year before. In three years, we have increased the grant to local authorities by £6 billion, a real-terms increase of 7.8 per cent. The hon. Gentleman must acknowledge that that figure contrasts sharply with the previous Government's cut of 4.3 per cent. in real terms in their last three years in office. The general context is that local authorities, including Hertfordshire, have received substantial increases in grant above the inflation rate.

Hertfordshire has shared in those increases. Indeed, some authorities would argue that it has had a disproportionate share of them. It has received increases greater than those of the average shire county, its total standard spending assessment has increased by more than £40 million and its grants have increased by 5.4 per cent or £27 million. Hertfordshire social services SSA has increased more in the first three years of this Government than it did in the last five years of the previous Conservative Government. Again, in comparison with the previous period, social services have received substantial increases in grant above the inflation rate.

The hon. Gentleman said that Hertfordshire does not get fair treatment from the grant system, but that is hard to square with the figures. Of the other 33 shire counties, only two get a bigger SSA than Hertfordshire. Hertfordshire has increased its budget by a bigger percentage than the average shire county, but has increased its council tax by a smaller percentage than the average shire county. Only two of the other 33 shire counties charge a lower council tax.

On the face of it, those facts do not suggest that Hertfordshire is badly treated by the present grants system. That is highlighted by some groups of authorities that make representations, such as the so-called E40 group of authorities, which are primarily rural shire counties and unitary district authorities. They feel that they do not receive a fair share of education funding and frequently cite Hertfordshire as an example of an authority which, in their view, receives an over-generous SSA.

That is the context for the funding of Hertfordshire social services and its impact on funding for learning disability services, which was the main point of the hon. Gentleman's argument. The Government made social services funding a priority in the 1998 comprehensive spending review and, for the first time, we guaranteed that provision nationally would increase in the three years between 1999 to 2002. As a result, local councils could plan ahead with greater confidence across the range of social services. In the period covered by the spending review, the provision for social services is for an additional £2.8 billion which, on average is more than 3 per cent above inflation for each of the three years. I hope that the hon. Gentleman concedes that that demonstrates the importance that the Government attach to social services, including services to people with learning disabilities.

In the second year of the period covered by the comprehensive spending review, the provision for local social services has increased by £492 million, which represents an increase above inflation of 5.6 per cent in cash terms and of 3.1 per cent in real terms. That is a measure of the substantial additional resources that we have given to all local authorities, including Hertfordshire, for personal social services standard spending assessments. That is the background to the matter, covering the general position on grants and the way in which that specifically affects social services SSAs and grants.

Audit Commission performance indicators confirm that, as the hon. Gentleman said, Hertfordshire has a higher than average number of people with learning difficulties. I understand that that is largely because the area once had three long-stay hospitals. Consequently, when responsibility for the services provided by those hospitals was transferred to local authorities, many of the hospital residents remained in Hertfordshire, regardless of where they had originally come from.

While the Audit Commission shows that Hertfordshire's spending on services for those with learning difficulties is above average, its performance indicators show that its circumstances are by no means exceptional. In terms of the proportion of its population who are supported on account of their learning difficulties, Hertfordshire just makes the top quarter of shire county authorities, and nationally, barely makes the top 50. Hertfordshire is in the wide top band, but it is by no means exceptional.

The hon. Gentleman will know from his own experience in my Department that Ministers are told, rightly, that all authorities have spending pressures. It is for each authority to decide how best to meet the needs of all its residents, given the available resources.

The hon. Gentleman mentioned that the county asked consultants to come up with a different formula for allocating standard spending assessments. The consultants initially tried to base a formula on an analysis, but were thwarted by the lack of reliable data—the sort of data that the hon. Gentleman wants us to use—so they devised what they described as a "judgment-based" formula.

On their first attempt, the consultants produced an analysis which showed that Hertfordshire should have another £60 million. Realising that that would probably be treated with some scepticism, they moved to the judgment-based formula. On the basis of that formula, they calculated that Hertfordshire should receive another £9.7 million.

However, the formula would also shift about £100 million of SSA away from inner London and the metropolitan areas, which have their own pressures on their budgets. Would the losers be fairly treated if we relied on a judgment by those advising Hertfordshire, which would be a big gainer? Even the consultants say that this formula is not adequate for the purposes of Central Government departments. Although I understand what the hon. Gentleman says about the pressures in Hertfordshire, and I have acknowledged that there is an above-average number of people with learning difficulties in that county, his overall argument is weak. I could cite to him the case made by a range of local authorities, metropolitan authorities and rural authorities, each of which would identify a different pressure, but none the less a pressure, on its budget.

Mr. Clappison

I am grateful to the hon. Lady for giving way. Will she address the point that applies to all authorities: if money is provided from central Government for people with learning disabilities, should that not reflect the number of people with learning difficulties in the authorities concerned?

Ms Hughes

I should have thought that the hon. Gentleman would know from his time as a junior Minister in the Department that it is a long-standing feature of the standard spending assessment formula—which we are committed to changing. and which he knows is under review—that all the indicators used in the formula should be outside the direct policy influence of the local authority. In other words, it should not be possible, by using a particular indicator, for the decisions that a local authority takes—in this instance, perhaps, to accept more people with learning difficulties—to be used as a mechanism for increasing its grant.

That is why, in relation to people with learning difficulties as well as a range of other services provided by local authorities, the indicators used are indirect indicators in terms of the general characteristics of the population. I am sure that the hon. Gentleman is well versed in this. I understand the argument that Hertfordshire has advanced, but it is not an argument that we have been prepared to accept, because that would unravel a long-standing feature of SSAs and leave the SSA formula open to influence by the policy decisions of local authorities.

Mr. Clappison

I am grateful to the hon. Lady for giving way again. I am not interested, as she seems to think, in comparisons with previous Governments, as I do not believe that that is helpful. I understand her point about other authorities, and I hope that I anticipated that in my remarks. I appreciate the difficulties, but will she listen to Hertfordshire county council and look at the research? Will she at least do that?

Ms Hughes

We have considered PricewaterhouseCoopers' research, but, for the reasons that I have just outlined, we cannot accept the point made by Hertfordshire that, on the basis of that research, the SSA formula should include a direct indicator of the number of people with learning difficulties.

The hon. Gentleman seems to have missed some of the points that I have made. It is interesting that he is not particularly interested in comparing Governments, but my reference to the previous Government was valid. I was careful to point out the substantial increases since 1997 that all local authorities have received generally and for personal social services. That is a valid point in terms of evaluating whether Hertfordshire should have enough money to allocate to services for people with learning difficulties in their area.

Mr. Clappison

The hon. Lady introduces a partisan element, which is not necessary and will not be well received in Hertfordshire. I hope that she will at least consider the further research that has been done by Hertfordshire county council and reflect on the fact that, further to her point about local authorities attracting people to their areas, people with learning difficulties are already in Hertfordshire—the hon. Lady knows the historical background—and are not getting the money that they need for their services. I understand the difficulties, but will the hon. Lady at least consider the research in an open-minded way, put aside partisan considerations and help Hertfordshire?

Ms Hughes

I do not accept that I am being any more partisan than the hon. Gentleman. The hon. Gentleman refuses to acknowledge the substantially improved finances for all local authorities that I have outlined. I dare say that he has not pointed that out to his constituents in Hertfordshire either, and he should, because not only does that result in an improvement generally, but it means that Hertfordshire has done particularly well. I have explained Hertfordshire's financial position relative to other shire counties, but the hon. Gentleman refuses to acknowledge that. He has not said that he has pressed Hertfordshire on why it is not allocating sufficient resources for people with learning difficulties.

I do not want to finish without making some general points about the grant distribution system and the priorities for people with learning difficulties in particular. I accept that the grant system attracts criticism. It is a long-standing and opaque system. It has operated for many years and it makes it difficult for authorities to see how their overall grant has been calculated and to plan ahead to improve their services. That is why, with the consent of local authorities, we have started to review that system.

As the hon. Gentleman knows, in the context of that review and with the agreement of local authorities, for the three years that that review will take the SSA formula will be frozen, apart from data changes. The certainty of increased grants, albeit on an SSA formula, gives local authorities time in which to plan, while allowing us to review the situation.

We are not specifically considering the issue raised by the hon. Gentleman within that review, but if Hertfordshire wants to send any research in addition to that done by PricewaterhouseCoopers, my Department will be happy to receive it and consider it in that context. If that is the assurance that the hon. Gentleman seeks, I am happy to give it.

Support for people with learning difficulties is an important priority for the Government, and for my Department and the Department of Health in particular. A significant group of people, including users and carers, as well as professionals, and including a member of a voluntary organisation from the hon. Gentleman's area, has been drawn together to work with us to develop a strategy for improving those services. Given the change of thinking around such services and the belief that such services should be based in the community, the improvement of services generally is one of our priorities and we will continue to strive for that.

I repeat that we have given much more support to local authorities, and also to people with learning difficulties. Funding to provide such people with services has increased substantially in the past three years. We have recognised the limits of the system of grant distribution that we inherited, and we are conducting a review. As I have said, I shall be happy to receive any information that the hon. Gentleman wishes to contribute to that review; but I cannot accept his basic contention that Hertfordshire has fared relatively less well than other authorities. Indeed, as I think that I have made clear, relatively it has fared very well. I hope that it will consider the funds that it has received and seek to improve services for people with learning difficulties in the way that we—and, I am sure, the hon. Gentleman—would like.

Question put and agreed to.

Adjourned accordingly at fourteen minutes to Six o'clock.