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Mr. Speaker: Order. I must say as gently as possible to hon. Members that the reading of a supplementary question should be resisted. It is easy to ask a supplementary without reading it into the record. I do not want to do so, but I will stop hon. Members if this practice continues.

Ruth Kelly: My hon. Friend makes an incredibly important point about the concentration of deprivation in particular social housing estates, and asks what the Government can do to tackle worklessness. Although we have made huge progress in raising the standards of accommodation for social housing tenants over the past 10 years by investing £19 billion, we face a critical challenge in improving job opportunities for people. The Hills report was launched recently, and one of its suggestions was that the Government could do more to improve the mix of communities and to bring worklessness and housing support together. The Government intend to explore those areas further.

Greg Clark (Tunbridge Wells) (Con): The Secretary of State will know that voluntary organisations make a huge contribution to tackling areas of concentrated deprivation. Five years ago, the Government promised that, by 2006, voluntary groups would receive the full cost of services that they provide to the public sector. Just last week, however, the Charity Commission said that only 12 per cent. of voluntary groups achieved full cost recovery on all their contracts. Will the Secretary of State tell us whether all contracts from her Department pay the full cost of services provided?

Ruth Kelly: I do not think that anyone could argue that this Government and this Department are not doing a huge amount to support the involvement of the voluntary sector in turning around areas of deprivation. I shall come back to the hon. Gentleman on how my Department is dealing with the specific issue that he raised. More than anything else, the voluntary sector is asking the Government for sustainability of funding. In the local government White Paper, which was launched in the autumn, we made a commitment that when local authorities give grants to the voluntary sector, they should do so on the expectation that that funding will be sustained for a period of three years. If we can make that a reality, it will do more than anything else that we could do for the voluntary sector.

Mr. Neil Turner (Wigan) (Lab): Local authorities are key to tackling social deprivation. Wigan is not unique in having a large proportion of super output areas, having 10 per cent. of the most deprived, yet it receives less in Government grant than the Government’s own formula says it should. How will the Secretary of State ensure that areas such as Wigan are able to tackle social deprivation if they are not given the resources to do the job to which the Government say they are entitled?

Ruth Kelly: I understand my hon. Friend’s passion for his local area, which benefits not only from the formula grant but from additional neighbourhood renewal funding, which has been incredibly important over the past five or six years in helping to turn round
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areas of concentrated deprivation, in tackling the issues about which my hon. Friend is concerned, including worklessness and high crime rates, and in making a huge difference. As we consider the future of neighbourhood renewal funding and the formula grant in the next round, we will think carefully about the issues that he has raised, but no one could deny that this Government have done more than any other Government to tackle areas of concentrated deprivation.

John Bercow (Buckingham) (Con): Given that one cause of concentrated deprivation is low pay among women who are in work, and that the gender pay gap among part-time workers is higher in the public sector than it is in the private sector, how is the right hon. Lady proposing to address the phenomenon in local government?

Ruth Kelly: The hon. Gentleman makes an important point. I am sure that he is aware that, this April, we are introducing a new duty on the public sector to promote gender equality. As we raise awareness of that duty, and as it comes into effect, public authorities across the board—local authorities, central Government and other public agencies—will think about how they can open up opportunities for women and continue to close the pay gap.

Rosie Cooper (West Lancashire) (Lab): There are areas of concentrated deprivation in my constituency. A new town in West Lancashire needs some redesign. What practical steps can the Secretary of State take to ensure that there is mixed development, to encourage the council and everybody else to get involved and to stop the concentrated deprivation?

Ruth Kelly: My hon. Friend is right: a mix of incomes is essential to try to promote opportunities for everyone living in an area. The Hills review and the compelling analysis that Hills undertook proposed several ways forward for the Government, one of which was to continue the large-scale remodelling of estates programme on which the Government have embarked. The other proposal was to look at innovative schemes such as the one in York, where, when a property becomes vacant, the council buys a property elsewhere and sells the void to the private sector on that estate. That is a creative way of opening up opportunities and creating a mix of incomes. Those are the sorts of ideas that we want to consider further over the coming months.

Social Care

19. Annette Brooke (Mid-Dorset and North Poole) (LD): What assessment she has made of the impact of the provisional local government grant settlement on social care provision. [123210]

The Minister for Local Government (Mr. Phil Woolas): We are committed to ensuring that local authorities are able to deliver effective local services without the need to impose excessive increases in council tax. In setting the overall level of grant for 2006-07 and 2007-08, we worked with the Local Government Association to look at the pressures that
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councils faced, particularly in relation to social services and waste management. The formula grant in 2007-08 therefore includes extra provision, over and above the previous plans, of £508 million.

Annette Brooke: What justification can there be for Poole council increasing transport costs to day centres by 160 per cent.—affecting vulnerable people—and Dorset county council reducing home care services for people with moderate needs? In the latter case, that is short-sighted if it means that people end up in a residential home sooner rather than later.

Mr. Woolas: The hon. Lady cannot have her cake and eat it. She cannot argue and campaign on the one hand for lower council taxes and on the other for more formula grant. I am aware of the funding settlement campaign that was launched after the finalisation of the settlement—perhaps raising questions about the motive of the campaign. Poole has received extra formula grant and it is for Poole council to determine its priorities.

Jeff Ennis (Barnsley, East and Mexborough) (Lab): My hon. Friend will know that my two home local authorities—Barnsley and Doncaster—have lost out to the tune of almost £10 million each because of the damping mechanism deployed for social services this year. Will he give his categoric reassurance to the House that that iniquitous damping mechanism will not be used in next year’s financial settlement?

Mr. Woolas: I commend my hon. Friend for raising the question of double damping. I would say that, rather than losing out, the local authorities have not gained. That is an important point. The impression may have been given that funding has been withdrawn, but it has not. That is more than just semantics. The point that he makes is about the damping mechanism in the social services formula, which is a matter for the review in relation to the 2008-11 settlement later this year.

Charles Hendry (Wealden) (Con): Has the Minister seen the parliamentary answer that I received last week that shows that the local government grant settlement for East Sussex works out at £160 a head, but the settlement in, for example, Bolton works out at £408 a head? If East Sussex were funded at the same level as Bolton, we would have a further £125 million a year to spend on services. Does that not show the inherent unfairness and regional bias of the Government?

Mr. Woolas: Hon. Members on both sides of the House should be commended for the ingenuity with which they put the special pleading argument. I suggest that the hon. Gentleman take up the point with Lord Heseltine, who devised the council tax system, which no doubt the hon. Gentleman supported at the time.

Alison Seabeck (Plymouth, Devonport) (Lab): Does my hon. Friend agree that some of the concerns expressed by the hon. Member for Mid-Dorset and North Poole (Annette Brooke) might be addressed by the strength of local area agreements? If so, will he tell us what discussions he has had with the Local
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Government Association and the Association of Directors of Social Services on this matter?

Mr. Woolas: My hon. Friend makes a very important point. Through local area agreements, supported by the Local Government Association and the Association of Directors of Social Services, which I met last week, we can examine how better co-operation between agencies and partners can result in not only better service provision but better use of public money, both capital procurement and revenue expenditure, through the sharing of decisions, investment and savings. That is the way forward.

Andrew Stunell (Hazel Grove) (LD): The Minister will know that the demands for social care have been rising rapidly—five times faster than the rise in his grant to local authorities. He will also know that the LGA says that a funding gap of £1.8 billion must be closed. What steps are he and the Secretary of State taking to impress on the Chancellor the need to take account of that funding gap in the comprehensive spending review, so that my constituents and those across the country who are in need of care can receive it?

Mr. Woolas: I take very seriously the point that the hon. Gentleman makes. Hon. Members from all parts of the House know that the demands for care services are outpacing even the significant and generous increases in grant that this Government have made.

Mr. Eric Pickles (Brentwood and Ongar) (Con) indicated dissent.

Mr. Woolas: The hon. Gentleman shakes his head, yet he supports a macro-economic policy that would result in less money being available. We need to have strategies to deal with this. The Government and the LGA analyse demands so that we can take decisions to address the inflationary and other pressures on councils and examine those considerations in the round. I have to disappoint the hon. Member for Hazel Grove (Andrew Stunell), because in my meetings with the Treasury I have not so far found the tree on which the money grows for free. The reality is that the Government have to take decisions about priorities. I invite him to engage in a debate about that.

Ms Diana R. Johnson (Kingston upon Hull, North) (Lab): Hull city council recently told me that it pays double the cost for social care that a very high quality local social enterprise could provide. Does my hon. Friend think that there is still room for local authorities to consider how wisely they are spending their social care budgets?

Mr. Woolas: My hon. Friend makes a very important point, which addresses the real world rather than the other world that the hon. Member for Hazel Grove was addressing. I congratulate local authorities on making great strides forward. Through the Gershon review, local area agreements and their commissioning role, they are, in many cases, finding both the quality and the savings to provide the services that her constituents need.

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Mr. Simon Burns (West Chelmsford) (Con): Does the Minister recognise that as people live longer an increasing number of complex cases of social care arise, costing considerable sums in individual cases? What can be done to ensure that proper care is provided for very frail and vulnerable people, while at the same time ensuring that people who have a great need for care, but not at that deep level, will not lose out because of the resources available?

Mr. Woolas: The hon. Gentleman makes a very important point in a serious way, and all in this House must recognise its truth. Over the past 17 years, while gross domestic product has increased by about 150 per cent., spending on social care has increased by 200 per cent. as a result of the pressures that he recognises. I understand that the Alzheimer’s Society today identified what it analyses as being a £17 billion shortfall.

The Government’s strategy is to address this question through the analysis of the grant and the spending review, as I mentioned in reply to the hon. Member for Hazel Grove, and through the local area agreement process, which allows a much more focused and better use of public funding across the spectrum.

Mr. Pickles: I am pleased that the Government have welcomed the Alzheimer’s Society’s report. However, surely there is some inconsistency here. Will the Minister confirm that under the national health service’s new framework for continuing care, thousands of people will lose their NHS funding for long-term care? There will simply be a transfer to local authorities’ social services departments, and local authorities will face a choice of either raising council tax or cutting help to the people—370,000 are at risk—whom my hon. Friend the Member for West Chelmsford (Mr. Burns) mentioned. The service is at breaking point, so what will the Government do? Will the Minister make a clear case during the summer spending review about the problems that social services will face? Will he tell the Chancellor that because of the Chancellor’s cuts in the health service, the problems can no longer be put aside?

Mr. Woolas: The Government’s approach through the spending review and our arrangements for local area agreement spending, whereby primary care trusts, other health partners and local councils can increasingly work together, is designed to use public money more effectively—that is being achieved—while keeping the taxpayer protected, which I hope the hon. Gentleman will join me in welcoming. The response to the situation is certainly not a policy of reducing expenditure on social care and health. We have a policy of ensuring that primary care trusts balance their budgets and work closely on social care through local authorities to address the public’s needs.

Enterprise (Deprived Areas)

20. Kerry McCarthy (Bristol, East) (Lab): What support her Department is providing to increase entrepreneurial activity and support local businesses in deprived areas. [123211]

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The Parliamentary Under-Secretary of State for Communities and Local Government (Angela E. Smith): The Government announced the local enterprise growth initiative in 2005. That was the first significant long-term Government proposal specifically to promote enterprise in the most deprived areas of England. Since February 2006, 29 authorities in England have received funding, from which residents in deprived areas are already benefiting.

Kerry McCarthy: My constituents were very disappointed when Bristol failed to secure funding under the second round of the local enterprise growth initiative, although having spoken to some of those on the periphery of preparing the bid, it seems that it was no great surprise to them that it failed. What support will the Department give to local authorities such as Bristol so that when they make future bids for similar sources of funding they will manage to make a better job of it?

Angela E. Smith: I understand the disappointment of authorities that were not successful. When the proposals were evaluated, we had to make sure that the money—£300 million over three years—went to where it could make the most impact to bring about transformational change. There is support for the authorities that were not successful in this round. We ask them to engage with the Government offices to discuss the problems with their bids and how their bids could be improved. I regret that Bristol has failed to engage with its regional office. I urge my hon. Friend to use her best endeavours to ensure that the council engages so that we can give it support and help it to improve its bids.

Justine Greening (Putney) (Con): I am sure that the Minister agrees that one of the main factors that stifle entrepreneurial behaviour on many of our estates is the fear of crime. On my Alton estate in Roehampton, shopkeepers are scared to reports thefts because of possible reprisals. The police oppose the only free ATM application for the estate because they are worried that it would be a magnet for criminals. At the same time, however, there are fewer trained police officers in Wandsworth than there were in 1997. What action is her Department taking to work with the Home Office to ensure that police officers are out on the street, where they are needed, so that the environment is safe for shopkeepers to get on with growing their businesses?

Angela E. Smith: Despite the hon. Lady’s lengthy explanation, I do not recognise the picture that she paints. Crime has gone down in London.

Justine Greening indicated dissent.

Angela E. Smith: The hon. Lady cannot deny the facts: crime has gone down and more money is being spent on ensuring that there is a police presence on the streets. However, she is right to identify the issues that we need to address, and are addressing. She would do well, however, to pay tribute to areas where we are bringing crime down and examining transport.
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Funding is going into neighbourhood renewal areas to address those very issues. I will take no lecture from the hon. Lady when crime went up under her Government.

Mrs. Louise Ellman (Liverpool, Riverside) (Lab/Co-op): Does my hon. Friend share my concern that, despite the city of Liverpool’s growing economic success, too many people remain deprived and without work? How confident is she that current initiatives, including the local economic growth initiative, for which the Government have approved Liverpool, will transform the situation?

Angela E. Smith: The LEGI scheme to which my hon. Friend refers, for which Liverpool successfully submitted a good bid, is designed to address the very issues that affect entrepreneurship and business in an area. Such a scheme must be private sector-led, and will receive approval and funding from the Government only if we are confident that it can effect a transformational change and make a real impact. She has been supportive of the project, and we are confident about it. We need to monitor it, however, as it has not been in place long, and we need to ensure that it does the work that it is supposed to do. But we are confident that the right policies are in place.

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