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DELEGATED LEGISLATION
Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6)(Standing Committees on Delegated Legislation),
That the draft Information and Consultation of Employees (Amendment) Regulations 2006, which were laid before this House on 12th January, be approved.—[Mr. Cawsey.]
Motion made, and Question put forthwith, pursuant to Standing Order No. 118(6)(Standing Committees on Delegated Legislation),
That the draft Occupational and Personal Pension Schemes (Consultation by Employers and Miscellaneous Amendment) Regulations 2006, which were laid before this House on 12th January, be approved.—[Mr. Cawsey.]
TREASURY
That Mr David Ruffley be discharged from the Treasury Committee and Mr David Gauke be added.—[Rosemary McKenna, on behalf of the Committee of Selection.]
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Local Government Funding (Poole)
Motion made, and Question proposed, That this House do now adjourn.—[Mr. Cawsey.]
10.46 pm
Mr. Robert Syms (Poole) (Con): This is not the first time that I have debated local government finance in Poole; it probably will not be the last, since we have a perennial problem with the shortage of funding from central Government. It does not seem to matter what system is invented by the people in the Office of the Deputy Prime Minister, we always seem to come out very much at the bottom end of the table. So whether it is the standard spending assessment, the formula spending share or the new system, Poole does not seem to be doing very well out of the system.
This year, the total Government grant increase is the minimum, which is 2 per cent. The unitary authority average, against which I shall compare during this short debate, is 2.8 per cent. Our total formula grant will be £22.8 million, which provides funding of a little under £167 per head. The unitary average is £330. That difference is worth nearly £22.3 million—a substantial sum that could make a significant difference to the quality of services delivered to my constituents in Poole.
I will not go into too much technical detail—not least because the new funding system, with its four blocks, is a little more difficult break into and break down when trying to find out the reasons why the grant is at a certain level—but the finance officers in Poole certainly feel very disappointed with the new system, which they think is complex and rather less transparent than the older system. The Minister might acknowledge the fact that the Local Government Association and others have criticised the new system.
None of the 150 education or social services authorities is receiving what the formula grant needs and resources calculation determines: 70 of them are at the floor and gaining more—including Poole, which is getting an extra £323 per head—and 80 are having their grant reduced or dampened to ensure that they all receive a minimum grant increase. That fact indicates that the formula system does not work, and there are real concerns about that.
What special issues do we have in Poole? Wages are certainly low. The average weekly wage for full-time workers resident in Poole was £448.50—86.4 per cent. of the average for England—but that contrasts with house prices, which are particularly high. The average selling price of all houses sold in Poole in 2004 was just over 10 times the average annual full-time income. That big gap has a great impact on the local authority's finances and recruitment. The population is ageing. Compared with the rest of the country, a smaller proportion of Poole's population is found in all five age bands under 50 and a greater proportion in all age bands over 50, across both sexes. Currently, about 54,500 people in Poole are aged 50-plus, which represents 40 per cent. of the population. Although, when one looks at the Sunday papers, one occasionally sees fabulous houses for sale at extortionate prices, that is not typical of Poole. It might be typical of one or two areas but, along with the areas of wealth, there are areas of great deprivation, including some wards that show up as being very deprived.
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We have a pretty good local authority. Under the revised comprehensive performance assessment methodology this year, the council has been assessed as a three-star authority. Last year, it was rated as "good", which is the second highest rating. Under the new methodology, the "direction of travel judgment" concludes that the council has
"improved well over the last 12 months. It has made some significant improvements to services important to local people."
The council offers good value for money, with costs generally below average.
Annette Brooke (Mid-Dorset and North Poole) (LD): Does the hon. Gentleman agree that the continuing poor settlement year after year along with exactly the same cost pressures, such as the increasing wages that are a big component of local government expenditure, inevitably means that there have to be cuts in sectors in which costs are rising steeply? For example, there are cuts across the board, including cuts in social and respite care in social services. Does he share my concern that our constituents will lose out big time if this continues year after year?
Mr. Syms: I agree with the hon. Lady with whom I share representation of the borough of Poole. Both the Conservative and Liberal groups have a common front in trying to get a better grant for Poole. Both parties feel that we are not being very well treated.
The council is looking to make significant efficiencies in next year's budget, and it is expecting to make them beyond the Gershon review. I am fortunate to be able to say that, although the council's final decision will be made on 16 February, it is looking as though there will be a 3.5 per cent. increase. Such an increase takes a lot of hard work and one way that the council was able to introduce an increase of that level despite bad funding from central Government is by keeping high vacancy levels and controlling staffing to increase its balances. It keeps control in that way. It is very much aware that our profile of an elderly population means that many people on fixed incomes find it difficult to meet a substantial part of their budget, so it is doing all that it can to minimise the tax burden on local people.
Poole people get significantly less Government funding and there are the whole range of costs that the hon. Member for Mid-Dorset and North Poole (Annette Brooke) mentioned. We expect annual pay settlements to go up by 3 per cent. and there are additional recruitment and retention pressures. The changes to advance corporation tax have had a big impact on local authority pensions, and Poole local authority workers are mainly part of the Dorset pension scheme that has suffered and requires more money. Waste management, street cleansing, licensing, highway maintenance and the EU hazardous waste directive present further costs, and the council is also looking at paying, with an increase this year, about £1.2 million in landfill tax that eventually goes back to the Treasury. They are very real costs.
Let us contrast and compare where we are. Fortunately, Poole is not at the bottom of the list of all-purpose authorities. That place is taken by Wokingham,
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which is preceded by Windsor and Maidenhead, Rutland and then Poole. Poole's formula grant per head is £166.53. Of course, there are no doubt different circumstances in the all-purpose unitary authorities, but let us consider a few boroughs that may have a similar profile to Poole. For example, I know that my colleagues in Bournemouth next door do not think that they are very well funded, but it receives £293.61, which is £127 more than Poole. Some of the streets in Poole stop where those in Bournemouth start, and there are probably slightly more people on benefit in Bournemouth because there are more hostels there. However, the difference is substantial when it is sometimes difficult to tell whether one is in Poole or in Bournemouth.
I guess that Torbay's profile—it is a seaside and retirement area—is not dissimilar to that of Poole. The formula grant per head in Torbay is £328.01, which is £161 more than Poole. I suspect that Brighton and Hove faces many issues similar to those faced in the Bournemouth and Poole area, but it gets £385.29. We are very much adrift from many comparable authorities.
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