Local Government Reform (Hansard, 18 December 2001)

§ 6. Mr. Clive Soley (Ealing, Acton and Shepherd's Bush)
If he will make a statement on the reform of local government. [21562]

§ The Secretary of State for Transport, Local Government and the Regions (Mr. Stephen Byers)
Last Tuesday, the Government published their White Paper on local government, setting out a radical programme of reform and modernisation based on new freedoms and greater accountability. In addition, I can inform the House that, in the light of representations received from some hon. Members and some shire districts as part of the on-going consultation on the 2002–03 financial settlement, I shall introduce an alternative baseline for 2001–02, which, in effect, adjusts only for the transfers of service for which shire districts are responsible. In order to guarantee a minimum 2.3 per cent. increase for shire districts, I will give each district whichever increase is greater—2.3 per cent. on the original baseline, or 2.3 per cent. on the alternative. I believe that that will meet their concerns.

§ Mr. Soley
I very much welcome that reply, but I urge my right hon. Friend to keep going with the reform of local government. Many people in all parties want local authorities to be returned the power and responsibility that was whittled away in the 1980s and 1990s. We must return that power and responsibility to locally elected people. As we do that, will my right hon. Friend consider giving more financial power to local authorities which must, at the same time, be held responsible by the electorate? I know of no better way of ensuring greater interest in local democracy than by linking financial responsibility with accountability to the electorate for how the money is spent.

§ Mr. Byers
I strongly endorse the principles that underpin my hon. Friend's comments. That is why we have always stressed that the White Paper that we published last week is about modernisation and reform. It is also, however, about greater freedoms based on accountability, which must be at the heart of effective local government.
When we published the White Paper, I tried to make it clear that it represented a change in direction in terms of central and local government relations. The interface between local authorities and central Government is never easy, but we must accept that we in this place and the Government do not have to control everything and that we have to believe in the strengths of local democracy. That is why we want to give new freedoms and flexibilities to local authorities. The White Paper outlines how we can do precisely that.

§ Mr. Mark Prisk (Hertford and Stortford)
In the Secretary of State's attempt to decentralise power from the centre to local government, will he guarantee that the future of county councils is safe in his hands?

§ Mr. Byers
Yes. The Government have no intention of proposing the imposition of the abolition of county councils. I can give that assurance.

§ Mrs. Anne Campbell (Cambridge)
Is my right hon. Friend aware that his proposals for the reform of local government finance have been welcomed in my constituency? They are certainly more welcome than the actions of the Conservative Government in the 1990s which led to an unfair and inequitable system of distribution. However, will he ensure that when he 138 implements the proposals, the transitional arrangements do not adversely affect those councils—particularly my county council—that are at the bottom of the heap for funding? I am sure that he will agree that we do not want to wait another 10 years to have an equitable distribution of the funding.

§ Mr. Byers
I am aware that Cambridgeshire county council has, for a long period, argued for a change in the regime by which we allocate funding to local authorities. It will welcome the fact that we will abolish the standard spending assessment that bears no relation whatever to the levels of services provided or to the needs of a local authority. It was, of course, introduced by the Conservatives when they were in government and it affects Conservative-controlled county councils and many other local authorities.
We shall see the end of the standard spending assessment regime and, instead, we shall have a system of distribution based on needs and the levels of services provided. There will be dramatic changes as a result of that, and it is only right and proper that we have a system of transitional arrangements to make sure that we do not adversely affect the provision of services and to ensure that those areas, such as Cambridgeshire, that may benefit will receive the benefit of the changes as soon as we can possibly introduce them.

§ Mr. Malcolm Moss (North-East Cambridgeshire)
Last year, three quarters of local authorities spent above their SSA for social services, with a total overspend of £183 million. Based on this year's financial settlement, local government bodies are already saying that the overspend could be nearly £1 billion. No amount of tinkering with local government reform will substitute for the proper funding of local authorities to provide the necessary level of social services to the old, vulnerable and weakest in their societies. Does not the Secretary of State have any shame that his Government are presiding over the near collapse of social services, over bed blocking on a massively debilitating scale and over a cruel and insulting level of services for elderly people?

§ Mr. Byers
Well, this is the party that introduced the poll tax into local government and that decimated council services year after year by cutting spending. This is the party that, when electors voted for Labour councils, abolished those councils because it could not tolerate real local democracy.
The reality is that this settlement gives 6.4 per cent. to personal social services, which is way above the rate of inflation. In addition, my right hon. Friend the Secretary of State for Health is providing an extra £200 million specifically to deal with bed blocking in the national health service, from which many local authorities will benefit. That is what the Government are doing, and we will continue to deliver good services, whether it be for the elderly or children at risk who know that for too long they have been denied the level of service that should be theirs. This Government are delivering. The people out there know that we believe in local democracy and local government, which is why we are providing the resources to ensure that services are delivered at last to those in greatest need.