§ Peter BottomleyTo ask the Secretary of State for Transport, Local Government and the Regions what information his Department has collated on the differential difficulties in(a) recruitment, (b) market rates of pay and (c) retention of essential public services staff in (i) the south-east and (ii) the north-east; and if he will make a statement on continued area cost adjustments in local government finance. [4794]
§ Dr. WhiteheadWe receive information from other Government Departments, in particular the Department for Education and Skills, the Department of Health and the Home Office, about the recruitment and retention of teachers, social services staff and police officers.
The present Area Cost Adjustment mechanism used in the local government revenue grant distribution system is based on differences in labour costs and rates costs in different parts of England. Information on labour costs is taken from the New Earnings Survey. This enables us to calculate the market rates of pay in different areas of the country and to reflect the higher costs of certain areas in the funding provided to local authorities. The current system does not include specific factors for differential recruitment and retention rates, as these issues should already he reflected in the prevailing pay levels in an area and therefore captured within the earnings data.
It is generally accepted that the grant distribution system needs to reflect higher labour costs in parts of the country. Our current review of the system includes a review of how exactly that should be done.