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Cumbria County Council

11 am

Mr. Eric Martlew (Carlisle) (Lab): I am pleased to have secured this short debate in the ballot, although it gives me no pleasure to initiate it. However, my constituents and the people of Cumbria deserve such a debate, because they need to know what is going on with Cumbria county council. It is time that the controlling alliance of Conservatives and Liberal Democrats was held to account—it is time that Councillors Toft and Ash stopped hiding and came clean.

I was a member of the council from its inception in 1974 until 1988, a year after I was elected to Parliament. During that time, I had the privilege of serving as chairman for two years, which is a period in my career that I look back on with pleasure. Looking back at the leaders in that period, I remember one gentleman, the late Martin Brannan, who was on the opposite side of the fence from me and intensely disliked by Labour members of the council. However, there is no doubt that he was an effective leader who knew where he was going and was held in respect, even by people who disliked his policies. A good friend of mine, Hugh Little, served as Labour leader of the council and had a different style and different policies. He, too, had leadership qualities and left the council in a better state than he found it. Finally, I served under the late Bill Minto, another Labour leader of the council whose style was different again. He believed in local government and the people of Cumbria, and his leadership was well respected by members on all sides of the council chamber.

Since the Conservatives and the Liberal Democrats formed an alliance two years ago, however, all that respect for the county council has been wiped away. The unholy alliance of the Conservatives and Liberal Democrats has reduced Cumbria county council to one of the worst councils in Britain. That is not my view, but the view of the Audit Commission. Despite a massive increase of 20 per cent. in council tax over the past two years, there has been no improvement in services. In fact, they have deteriorated so much that last month the Audit Commission removed the county council's fair rating, which was not good to start with, and replaced it with a weak one. Cumbria county council was one of only nine councils in the UK that were downgraded, and the only one in the north-west region. Worse than that, however, the council received a zero rating for social services, which is very worrying.

We now have a council that is rudderless. The chief executive has taken early retirement and the deputy chief executive is on long-term sick leave, yet Messrs Toft and Ash blame the previous administration, the Government, the press and, most disgustingly, their own staff. They are trying to shift the blame, but the people of Cumbria are becoming disillusioned with their leadership. Toft and Ash were elected on a policy to invest, save and improve services—basically, a policy of privatisation. As a politician, I disagree with that policy, but I accept that they had the right to pursue it. However, they have failed. They have failed to sell off Cumbria Contracting Services, which is the most profitable part of the county council, and have tried to sell off Cumbria Care, which looks after the elderly. That has not been a success, but they have run up major bills and failed to invest in residential homes. Last year

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we had a major problem when they wanted to sell off Talkin Tarn, a county park. I have visited the park many times, even though it is not in my constituency but in Penrith and The Border. They were going to sell it off to the highest bidder. There was a massive uproar, so they decided that perhaps they should not sell it. They then considered giving it to their friends who run Carlisle city council, but as yet we do not know for certain whether that will happen. We have been left in limbo. They also talked about selling Eskdale Mill in the west and the successful port of Workington. If he catches your eye, Mr. O'Hara, my hon. Friend the Member for Workington (Tony Cunningham) will have something to say about that.

Toft and Ash planned to sell off a great deal, but they have got little back. They have been unsuccessful, despite employing consultants—PricewaterhouseCoopers—who estimated that the income from the policy would be £24 million. There have been no capital receipts or overall improvement in performance, but there has been a massive 20 per cent. increase in council tax. With consultants, there is always a bill. The council has paid £3 million in consultancy fees for zilch, as it has got nothing but poorer services. It cut highways maintenance by 20 per cent. last year and is talking about doing so again. Toft and Ash are talking about selling off Cumbria Waste Management, a wholly owned subsidiary of the county council, which will result in a major bill for council tax payers in future.

That was the mess that the council was in last year, so what conclusion did the two councillors reach? Did they consider resigning or sacking senior managers on the county council? When they considered the problem they came up with a solution—pay the chief executive extra money. They concluded that he needed a 23 per cent. increase in his salary, and the following month, he was given another 7.5 per cent. increase. We now have a chief executive of a two-tier council system—Cumbria has district councils as well—who earns more than £134,000 a year for his responsibilities for a population of under 500,000. In comparison, the Prime Minister is responsible for 60 million people and receives a salary of £175,000.

It was not only the chief executive who received a large increase. The chief officers under him got a big increase, which upset councillors and residents a great deal. When the writing was on the wall following the Audit Commission report, the leading councillors in the alliance decided on 11 November to suspend Louis Victory, the chief executive. On 12 November, however, they denied ever suspending him. I suspect that Mr. Victory's lawyers had made a phone call to the county council. Then, on 12 December, Mr. Victory—a gentleman who less than a year before had received a major salary increase—announced his early retirement. That was not a bolt from the blue, as we all knew from 11 November that it would happen. However, we did not know how much, if anything, Mr. Victory received as a golden handshake.

The county council leader, Councillor Toft, says that the matter has nothing to do with people in the county council area, and that stakeholders and the electorate should not know about it. All sorts of rumours are being bandied about. Some people say that the handshake is worth more than £100,000. I have heard that the figure is £600,000, with an enhanced pension for the chief

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executive. However, we are not to be told. The situation is farcical. The chief executive is at home, taking what the civil service calls gardening leave. He does not have an office in the county council, and is working from home until February. Even though he earns more than £10,000 a month, he does not have an office at the council.

We also have a problem with social services, and I wrote to the Minister for Children requesting that the Government take over responsibility for them. The inspectorate gave our social services a zero rating. It commented that children's services pursued unsafe practices and, over the past couple of years, my case load has included many complaints from constituents about their behaviour. At one point, a senior social worker came to the door of my office, but told me that she could not step inside because she would be disciplined. One young person, she believed, had been placed wrongly, but disciplinary action could be taken against her if she told me anything. I have received complaints from staff throughout the county about bullying in children's residential homes.

The situation is worrying. The former director of social services was made deputy chief executive, but is now on long-term sick leave. The council quickly appointed someone else, but he was found to be unsuitable because of something in his past, and never took up his post. Another troubleshooter is being imposed, but I have no confidence that the situation will improve, given the record of the leaders of the council. I remind Members that on 11 November, the chief executive was suspended and reinstated. On 3 December, the leaders of the council, including the chief executive, were summoned to Whitehall to explain how they were going to put things right. They talked to the inspectorate, but did not reveal that the chief executive was going to leave. According to the plan that they submitted to the inspectorate, he was to spearhead the revival of social services. On 12 December, however, he announced his early retirement. That is a disgrace. I believe that Councillors Toft, Ash and Mallinson misled the Government and should resign.

On 23 January in a council meeting, the Labour group leader, Councillor Stewart Young, a gentleman for whom I have a great deal of respect, tabled a motion of no confidence in the administration. I hope that the vote on that motion is successful. However, I hope that the leading councillors will not wait for that vote, but will resign before then, because they have no integrity or ability. We should have a new administration. I know that it is not the job of either the Office of the Deputy Prime Minister or the Government to take over the running of social services, but services, especially children's services, are not safe. I believe in local government, and I do not want Government to take over the running of Cumbria county council, on which I served for a long time. Many good people still serve on it. However, the Government must talk to it to see how the problem can be sorted out. If we do not do something now, it is only a matter of time before my hon. Friend the Member for Workington (Tony Cunningham) and my right hon. Friend the Member for Copeland (Dr. Cunningham), who sends his apologies for being unable to attend our debate, will call for Government action. This is a sad situation. It gives me no pleasure to make this speech today, but we have serious problems with local government in Cumbria.

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11.15 am

Tony Cunningham (Workington) (Lab): My hon. Friend the Member for Carlisle (Mr. Martlew) paints an alarming picture of Cumbria county council but I recognise it and so do many people who write to me: the council tax payers who have suffered an increase of 20 per cent. in council tax charges; the people who must pay a £10 an hour care charge, although previously they did not; and the trade unions—I have figures showing that the county council wants to cut £1.8 million from the school meals service, which would result in more than 600 job losses.

My hon. Friend touched on the shambles that is Cumbria county council. When the chief executive, Louis Victory, received a 23 per cent. salary increase and he was asked why he thought he should receive such an increase, he said quite boldly, "Because I deserve it." Shortly afterwards, he was suspended. However, the council could not even do that properly. He was suspended one evening and the council met the following morning to decide whether it had suspended him or not. I think that the discussions were along the lines of whether the council should reinstate him or pretend that it had never suspended him in the first place. That is the shambles that is Cumbria county council.

As my hon. Friend said, those responsible tend to blame the previous administration. Mention has been made of a close friend of mine, Councillor Billy Minto, who died recently, and who was a superb leader of Cumbria county council. He would be devastated if he could see its present situation. Attempts are also made to blame officers. However, almost all the senior officers have left. It is not a matter of rats leaving a sinking ship—they are people of principle leaving a sinking ship. Some of them have left without a job to go to. They have simply said, "I have had enough. I cannot work in this administration any longer."

As for what people in Cumbria think, first, the chief executive is given a 23 per cent. pay increase, then he is suspended, then he is not suspended or is on gardening leave, then the people who have had to put up with 20 per cent. increases in council tax hear rumours that he could be given a golden handshake of anything between £250,000 and £600,000. They are extremely angry.

In my constituency of Workington, my father worked at the dock for nearly 30 years, so I know the place. I have been there many times. It is a superb dock. It is competent, efficient and profitable, yet the county council plans to sell it. That has led to instability and low morale.

Perhaps the best example that I can give is the recent decision on the southern link—a road project that is desperately needed in Workington. Consultants were brought in to establish which scheme to put forward, so that Government funding could be obtained to build a much-needed bypass. Only one could be presented. The consultants said: "We have looked at schemes throughout the county. The only one that is sustainable and that can be built is the Workington southern link."

The Conservative-Liberal Democrat county council said that it would put forward the Kendal bypass. The consultants had already said that it was not feasible and that the Workington scheme was the only one that would be successful. The council went ahead, because of

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its political leanings, with the Kendal scheme. Then the deputy leader of the council said that there was not a problem, because it would never be built.

A scheme has been chosen that will never be built. The one that should have been built will not be built. People in Workington are angry that a political decision of that magnitude has been made on a whim. The suspicion—and my view—is that the reason for the decision was that west Cumbria is seen as a Labour area, whereas the area around Kendal is seen as a Conservative-Liberal Democrat area. It is an absolute shambles, and I concur with my hon. Friend the Member for Carlisle: if the administration had any decency, those two councillors would go, and quickly.

11.20 am

The Parliamentary Under-Secretary of State, Office of the Deputy Prime Minister (Phil Hope) : I congratulate my hon. Friend the Member for Carlisle (Mr. Martlew) on securing a debate on an issue of great importance to him. He is a keen champion of his local area, with great involvement in Cumbria—he has been active as a campaigner, as an elected council member and now as a parliamentarian—and I know that he wants to see his council providing the best possible services for his constituents. His concerns have been strongly echoed by my hon. Friend the Member for Workington (Tony Cunningham). Some of the issues that have been raised are slightly outside my responsibilities within the Office of the Deputy Prime Minister, but I shall make sure that my colleagues in other Departments get to know about them, and endeavour to deal with the points that I can answer.

Before I respond to specific points about Cumbria, I shall set out how we go about encouraging better performance by local authorities. We introduced the best value and comprehensive performance assessment systems to achieve that. In December 2001, we published our White Paper, entitled "Strong Local Leadership—Quality Public Services", setting out our vision for local government. That vision was for high-quality, customer-focused public services delivered to local people by councils that not only listened to their communities, but took on board their views when setting local priorities.

We recognised that such a vision could not be delivered overnight and that local government could not do it on its own. That is why we introduced a performance assessment framework that covered performance across all a council's services, enabling the council to build on its strengths and to tackle its weaknesses.

We were not starting from scratch. We began on the road to improvement by introducing best value as a replacement for compulsory competitive tendering. The advent of best value provided a framework for local authorities to secure continuous improvement in all their functions through economy, efficiency and effectiveness. Best value reduced the constraints on councils that prevented them from working in new and strategic ways with partners. It put the needs of people and communities first. Instead of asking how they could pay the least for services, councils began to ask how they could provide the best.

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The introduction of best value performance indicators meant that the same services could be measured in the same way across every council in the country, and CPA took that ability to compare the performance of councils one step further. CPA was introduced in 2002 and, only a year after the White Paper was published, the Audit Commission announced performance ratings for all 150 single tier and county councils in England.

The public reporting of council performance was a key aspect of CPA. For the first time, local people could gain a clear understanding of how well they were served by the council across a number of services. A public that are better informed about their council are more likely to engage in local democracy—to get out there and vote—something that we all agree is important. On the whole, the results in 2002 were promising. Over 50 per cent. of councils were rated good or excellent, but for others the CPA rating was a wake-up call. It brought home to them the message that central Government were not prepared to tolerate poor performance.

The most recent CPA scores showed that most councils have taken the message on board. There has been an overall improvement since the first year, with 26 councils moving up a category. However, just as importantly, as my hon. Friends have pointed out, CPA can highlight councils whose performance has deteriorated and where action is needed to reverse the trend. My hon. Friend the Member for Carlisle was right to point out that nine councils moved down a category, including Cumbria county council, which moved from fair to weak.

However, the CPA is not about naming and shaming. The result of a performance assessment is only the beginning of an improvement planning process that can secure higher-quality services run by an efficient and effective council. Following their CPA result, all councils, including Cumbria, begin that planning process by identifying and clarifying their priorities for improvement. Such planning also provides the basis for a proportionate and focused response from Government. For those councils classified as poor, we have engaged directly to tackle poor performance, and will continue to do so. That is not Cumbria's position because it is classified as weak. I remind my hon. Friend the Member for Carlisle that local councils are political, democratically elected bodies. In every council, regardless of its CPA result, responsibility for delivering improvement to the community lies with the council.

I now turn specifically to points about Cumbria. As with any other authority, the Government are concerned about deteriorating performance, and the recent drop in Cumbria's CPA score from fair to weak is worrying. We expect the council to take the necessary action to ensure rapid yet sustainable improvement. However, the Government are committed to tackling poor performance and we shall take direct action, where improvement is not seen to be progressing sufficiently.

Officials from my Department have been in close contact with members and officers of Cumbria county council. We are beginning to share views on problems in Cumbria. The Government will be willing to help serious efforts by Cumbria to deal with its problems. Part of the challenge, picking up some of the points made by my hon. Friend, will be to strengthen the

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corporate management of the council, enhancing its ability to tackle problems in social services and other key functions.

Our capacity-building programme, which we run jointly with the Local Government Association, provides a mechanism for delivering that support. The programme includes a specific element of support for poor and weak councils. We want to encourage the poorest performers to develop ambitious plans to transform their entire organisations. We expect considerable effort and commitment from such councils. In return, we shall offer significant financial support.

Officials from my Department are already in discussion with Cumbria county council about its improvement plans, and the degree to which we might be able to support those plans through the capacity-building programme. We encourage the county council to access those funds, so that we can assist it to develop effective support proposals to enable sustainable improvement.

As my hon. Friend the Member for Carlisle pointed out, a drop in social services performance for children was a major factor in the downgrading. The social services department in Cumbria has been given a zero star rating. We do not take that lightly. The social services inspectorate is already engaging with the council. Cumbria has been given three months to secure corporate and social services capacity and capability to take forward service improvements, and to enhance monitoring arrangements currently being established with the council. It is being required to produce an action plan and the social services inspectorate, with which meetings have already taken place, will require that progress is made against set targets. The council is

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being required to take immediate steps to secure the safety of children. The inspectorate will check that such arrangements are in place and will report to Ministers.

I understand that an interim director of social services has been appointed and will take up his post on 1 February 2004. He is a former director of social services and an experienced interim director. It is also worth mentioning that the resources announced by the Chancellor in the pre-Budget report ensured that Cumbria received an additional £2.5 million or so of extra resources in order to take on some of those extra challenges.

My hon. Friend the Member for Carlisle mentioned at length the financial package for the chief executive and I am sure that his points will be noted here and elsewhere. Of course, such packages are a matter for the council, but I understand his concerns. Although I am not in a position to comment on any individuals or appointments, he will know that my right hon. Friend the Deputy Prime Minister has made his concerns known more widely about pay settlements for chief executives in local government.

In conclusion, I understand the concerns of my hon. Friend and those of my hon. Friend the Member for Workington about the council's performance. I can assure them that central Government will do all they can to help the council to tackle its problems and to plan its recovery. We want to see all councils, including Cumbria, delivering high-quality public services and hope that the system of comprehensive performance assessment, and the support that I have described, will help to realise that vision.

11.29 am

Sitting suspended until Two o'clock.

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