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9.21 pm
Mr. Kevan Jones (North Durham): Like my hon. Friend the Member for Leicester, South (Mr. Marshall), who is no longer in his seat, I intend to be parochial and raise the dire situation faced by Durham county council this year.
The Minister has referred to an average settlement of more than 7 per cent. Durham's allocation is just over 5 per cent., one of the lowest settlements of any county council in the country. Durham county council has always been moderate and responsible. Even during the 1980s, a time of lunacy in some London boroughs, Durham was a responsible council that worked within its means. It went through some tough times, with the closures of the steelworks at Consett and the Durham coalfield, but it came through and worked in partnership with local business and local people. This year, however, it finds itself in a depressing situation.
Social services and education have been mentioned tonight. Durham, like many other county councils, is facing pressures due to the growing numbers of elderly people in the community. That is exacerbated in County Durham. Its long industrial past has meant a legacy of industrial-related diseases to elderly people, and they need intensive care from social services.
The other pressure is children's services, which was mentioned by the hon. Member for Torbay (Mr. Sanders). He is right to say that those services are expensive and there is no control over them. Durham's intake this year is up by about 30 per cent., and the council cannot budget for that. A colleague of mine on Newcastle city council, Colin Gray, the chair of finance, used to say that it would be cheaper to send someone to Eton or Harrow than it would be to have them looked after by the local authority. Education services are very expensive and councils such as Durham have very little control over the number of children in their care.
It has been announced that Durham will receive an additional £1.8 million mainly to deal with bed blocking, which has been a problem for Durham and most other councils this winter. That compares with last year's figure of £1.6 million, which does not bring a great deal of joy to the county council. It has been estimated that to deal with its social services problem, the council needs about £10 million. That raises a bigger problem, faced by many councils, of how to make the connection between councils, social services departments and the health service, because £10 million is a drop in the ocean to the health service but not to a council such as County Durham.
The council is making some difficult decisions this year about the closure of homes. It is undertaking rationalisation that the present leadership realises is long overdue. The council is also making a capital investment of £10 million in new provision. That capital receipt came from the council's share in the sale of Newcastle airport. The council is facing up to its social services problems and tackling them.
In Durham, education offers a good example of non-joined-up government. Last year, the county council received £2.76 million in education budget support grant.
That was withdrawn this year so it will be difficult for the council to meet the standard funds for investment in schools. That is sad. In my constituency and throughout Durham, since Labour came to power in 1997 there has been some good capital investment. For example, almost £3 million has been spent on Pelton Roseberry school and we can see the difference that has made. However, Durham will have to find that funding this year.Furthermore, money has been taken from council budgets for the learning and skills councils, as has been mentioned; £850,000 has been taken from Durham county council's budget that was not spent on sixth form provision. The result is that primary and secondary schools will suffer because that money was arbitrarily taken from the budget. When I made representations to the Minister about that, he said that it was a matter for the Department for Education and Skills. However, I plead with the Government to use joined-up thinking on such decisions.
Durham is not an irresponsible council. It has had to take many difficult decisions during the past few years but we shall face a record rise in council tax this year, whether we like it or not. According to my estimate, after today's announcement, grants of about £300,000 will be allocated to Durham county council. That is a drop in the ocean when education has lost £2.76 million alone, apart from the pressures on social services.
I plead with the Minister to consider Durham's case. The problems will not go away and the council will find it difficult not to impose council tax rises of 10 per cent. or more. Several hon. Members have referred to the new system that will apply next year. I accept that, but I agree—with some trepidation—with the right hon. Member for Skipton and Ripon (Mr. Curry) who pointed out that we are trying to find a system that will please everybody, but clearly we cannot do so.
Durham faces a tough year and local politicians will have to take some hard decisions. I plead with Ministers to reconsider Durham's case. We will not be able to avoid a council tax rise of at least 10 per cent.
9.28 pm
Mrs. Annette L. Brooke (Mid-Dorset and North Poole): There are parts of four councils in my constituency: two district councils, one unitary council and the county council. In our local newspaper, all the predictions are that although council tax may rise by less than 10 per cent. in one or two places, the rise for the councils in my constituency and for neighbouring authorities will be much more than 10 per cent.
The Minister might have given me good news for the district councils although I am not sure. If the news is not as good as I thought, I shall write him another letter.
I shall concentrate on the county council and the unitary authority and, yes, I shall speak about social services again. I make no apology for being repetitive because they are so important. Last year, throughout the south-west region, 13 of the 15 authorities spent 72 per cent. above the SSA for children's services, so we cannot point the finger at individual authorities.
I am a member of Poole unitary council. I promise that I will not go through the budget line by line—I shall choose a few examples. Poole is a small authority and, as
several hon. Members have pointed out, that makes things doubly hard: just one change has a big impact. Spending on children's services is an enormous 70 per cent. above SSA. In the social services budget for 2001–02, with an SSA of about £23 million, Poole unitary authority is heading for a £2 million overspend. That might not sound a huge sum, but it certainly is in relation to the budget. That obviously signals tremendous problems for next year.Many hon. Members have mentioned the problems in social services. We cannot take risks with our precious young people. We must respond to real-life problems. I cannot believe that the Minister is actually asking us to look for cuts in the social services budget when it is so tight.
On Friday I had a meeting, along with other MPs, with Poole unitary authority. I asked why, when most authorities were reporting an overspend on social services, Poole's overspend was so large proportionately. The answer was that there were special factors, such as an inability to find enough foster parents and a consequent need to buy in extra help, and the fact that some children needed very expensive education.
Poole, as an authority, has a low council tax. It is in the lowest quartile for the country. It is one of the lowest spending authorities throughout the south-west—it has been in Liberal Democrat control for the past 10 years. One cannot really accuse Poole authority of being an irresponsible high spender, but what is it to do unless there is some response to all the cries, from throughout the country, about the particularly severe situation regarding social services?
I beg the Minister to listen tonight. We hope for better with the new formula, but the crisis is with us now. We cannot afford to wait another year before that may be addressed. I put that plea for all the councils with the same problem, because it is so serious and the individual cases are harrowing. I shall be in a position to vote, and I certainly cannot vote for any shortages on the social services budget.
We are short of time so I shall change topic rather abruptly and move on to fridges for a while, to illustrate my point. I repeat that Poole is a small unitary authority. I thought that there was a mistake in an e-mail that I received tonight, but I can now see that the figures do add up. Poole has been allocated £17,000 to store all the surplus fridges, and officers from Poole unitary authority have told me that that amount is about £180,000 short. That is a very big sum for a small unitary authority.
I thought that that figure was wrong, but the Local Government Association predicts that storage of surplus fridges will cost between £60 and £65 million—10 times the £6 million that has been allocated. Whereas I responded in a similar way to the Minister when I read that e-mail, thinking that it was wrong, I now, having heard the LGA figures, think that it is right.
The question for my council and many other councils is whether they should budget for costs of £180,000 or whatever and build that figure into the council tax because they have to find that money, or hope that the Minister will monitor the costs closely and address the matter if the costs exceed £17,000, or whatever amount each authority has been allocated.
Our biggest concern must be the fact that there will be high percentage increases in council tax. It was refreshing when the hon. Member for North-East Cambridgeshire
(Mr. Moss) said that the high percentage increases in council tax would be down to the Government. In my area, we usually find that if it is a Liberal Democrat- controlled council, various leaflets say that it is the Liberal Democrats' fault. If it is a Conservative-controlled council, those same leaflets say that it is the Government's fault. It is bad that we have a blame culture.The only point that I want to raise on reform of the area cost adjustment is that it must be clear, open and transparent so that local councillors are genuinely accountable to their electorate, which they are not at the moment. At the moment it is a case of who tells the best story and how many times. We have some amazing graphs that go off the pages referring to council tax increases in Liberal Democrat councils, but at the end of the day my authority and Dorset county council have relatively low council taxes, so that is not the issue.
However, a large percentage increase is an issue for many elderly people and others on fixed incomes. It is not easy to say that the problem is that we have not spent enough over the years on our services and that we have got to up the money to cover the social services this year. That really hurts those at the other end of the range—the elderly and the vulnerable. We need much more help than is offered in the local government financial settlement for 2002–03, and I urge the Minister to consider funding for children's social services in particular.
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