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Mr. David Curry (Skipton and Ripon): It is a pleasure to follow the maiden speech of the hon. Member for Ipswich (Mr. Mole). He said that he was not a great fan of tradition. A few moments later, I noticed that the Labour Deputy Chief Whip arrived in the Chamber, so clearly the hon. Gentleman has already made his mark in that regard. We should not worry—he will become a fan of tradition after he has been here for a little while. After all, his affection for Ipswich Town football club denotes a gentleman with considerable faith.
We all subscribe to the hon. Gentleman's gracious remarks about his predecessor, whom we shall miss, as the people of Ipswich already miss him, but they will soon learn that their new Member of Parliament has brought to this place a great deal of experience of local affairs. He spoke of their history with affection, a little teasing and a great deal of understanding. I am sure that he will soon feel at home with us, and we will feel at home with him.
When I was a Minister, with responsibility for local government, the hon. Gentleman came to see me, I suspect, to ask for more money, but there again, almost everybody did. The only point that I make about Ipswich is that in the return match against Dynamo Kiev, the club lost handsomely. I would not wish to draw any analogies about the next election result on that basis. Being a supporter of Bolton Wanderers for reasons that are too complex to explain, I have some doubts about wishing to see Ipswich rise above the bottom three in the table, because I know which team would replace it.
I hope that I am not regarded as eccentric for wanting to make a speech, rather than an intervention, in the debate. I note that total standard spending for local government is about £60 billion in England. That is a quarter of all public expenditure. I cannot help but note that when the Chancellor delivers a Budget, we spend five days debating it, and when we are speaking about the distribution of 25 per cent. of total public expenditure, we spend three hours debating it. Perhaps we should reflect on that allocation of time.
I accept that the settlement is relatively generous. I am grateful for the abolition of the council tax benefits subsidy limitation scheme—a wonderful mouthful. I served on the Committee that passed the relevant order, and I said at the time what a silly idea it was. It was a means of making the almost-poor subsidise the poor. I am glad that the Government have at last come round to my way of thinking and got rid of the wretched thing, which only pushed up council taxes at the expense of those least able to pay, in those local authorities with the largest number of houses in the lower bands, multiplying the effect of hitting the people whom, in theory, the Government were trying to help.
As the hon. Member for Torbay (Mr. Sanders) said, the increases in RSG and SSA necessarily have implications for the level of council tax. In a sense, they pull the council tax up with them. If a council raises a third of its money locally, if the Government say that spending should rise by, say, 7 per cent. and insist on the passporting of all the SSA through to the services, and if the Government further provide only two thirds of that increase, it follows as night follows day that the other third must come from the council tax in roughly the same sort of volume as the increases that the Government have
made. In North Yorkshire, that pull-through effect automatically means that a council tax increase of some 4.5 per cent. is necessary to make the settlement whole.Although the settlement may be relatively generous, serious problems exist. Like other hon. Members, I shall talk about social services. Three years ago in North Yorkshire, we "lost" £3 million because of a change in the method of calculating the formula. Social services are historically underfunded; they do not have the same lobby as education. All head teachers suddenly became wonderfully acquainted with the area cost adjustment, even those who taught in schools that were nearer the Scottish border than the south-east region.
Social services funding is fragmented by its nature. The people whom it helps are not perhaps the most eloquent in arguing their case. Social services are therefore the Cinderella of local government. In North Yorkshire, we have had to overspend more than £3 million to keep social services afloat. That has almost exhausted the reserves. We must now rebuild the budget, stabilise it and reconstitute the reserves.
The reserves are used to deal with not only the demand on social services but natural disasters such as foot and mouth disease. The Selby rail crash happened in my constituency, and the coroner's costs fell on the local authority. Flooding also occurred there. Reconstituting the social services budget and covering the emergency costs are worth another 4.5 per cent. or more.
A curious quirk of the Bellwin formula, which I am sure that the Minister recognises, means that the amount of money that the Government allocate to alleviate emergencies depends on the number of teachers that the local authority employs and their grades. It kicks in after 0.2 per cent. of the budget, which is largely determined by the teachers' pay bill. [Interruption.] I await the Minister's wonderful new scheme. I remember his predecessors' words about finding a way through the area cost adjustment. They knew that the north-west passage was somewhere in the ice floes. Boat after boat got stuck in the ice because the north-west passage did not exist. The Minister will find it difficult to negotiate his way when the wonderful sons or daughters of SSA come into existence.
Mr. Andrew Stunell (Hazel Grove): Will the right hon. Gentleman give way?
Mr. Curry: I am afraid not because I am time limited.
The build-up of pressure on social services is remorseless, and demography partly accounts for that. However, the increase in demand is most acute in children's services; it is not surprising that local authorities decide to play it safe after so many high profile cases of social services failures. The implications are enormous. The Government know that the funding is inadequate, that the inadequacy will continue and that that invites a crisis.
We all know that local authorities currently spend £1 billion above their SSA on social services. The Minister is an intelligent man; he knows that that constitutes a crisis. I am sure that he would have loved to use some of the Department's transport underspending for social services, but the Treasury would not allow him to make the transfer, and he simply got stuffed.
Our case in North Yorkshire is eloquent. We can foresee the pressures. Elderly people whose care was previously funded directly by the Department of Social Security, now the Department for Work and Pensions, under the so-called preserved rights will be funded by the local authority. There are approximately 1,000 cases in North Yorkshire. Let us consider the fees. The weekly fee for ordinary residential care is £229 under preserved rights, but North Yorkshire pays £275; the fee for highly dependent people is £265 under preserved rights, but North Yorkshire pays £300; the nursing fee is £342 under preserved rights but £390 for North Yorkshire.
It is inevitable that care home owners will ask for the equalisation of those fees. North Yorkshire has not paid that money without heavy negotiations with the care homes. In my constituency, care homes gave notice to the local authority to terminate contracts for people, including those in their 90s, who had been in homes for years because the owners believed that they could not make a living, the local authority could not pay more and the victims tended to be the least able to understand the problem or to defend themselves. Those scattered incidents will become more common unless we consider the structure of the services.
The county has received short-term funding through the building capacity and partnership scheme, for which we are grateful. But the Minister talked about the need for certainty. He said that that was why he was reforming his system. Well, we are all sitting here agog, waiting for the next phase of the spending review before we know whether that funding will continue in the third year, so there is no continuity there.
The Government have also issued guidelines on charging. North Yorkshire's local authority has had an extensive range of charging, but some of that will have to be discontinued, as its estimated cost is more than £500,000 over six months. That is just for social services departments. In addition, the rules have changed on the educational standards fund, so that the Government's participation goes down.
Then we have the wonderful, complicated business of the transfer of funding from the local education authorities to the learning and skills councils, which makes the Schleswig-Holstein question look elementary. That has been done in a way that has left a number of local authorities, including Durham and North Yorkshire, having to subsidise education below the levels of their sixth forms because of the way the money has been passed back, after having been taken from the local authority. This means that the counties are going to have to subsidise education in that way.
In general, I welcome the settlement. I look forward—as one who has been there and got the tee-shirt—with eager anticipation to what comes after it. I exhort the Minister to take seriously his own promises about ending the ring fencing, and to urge his Secretary of State to take seriously what he said in Harrogate, which was that he was going to dismantle some of the apparatus—the great gendarmerie—that is supervising best value. That great inspectorate has taken over most of the democratic and accountable functions in large parts of our public services. I look forward to what is to come. As the clown said to Cleopatra:
- "I wish you joy of the worm."
- 8.46 pm
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