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Westminster Hall

Wednesday 20 February 2008

[Mr. Roger Gale in the Chair]

Working Neighbourhood Funding (Leeds)

Motion made, and Question proposed, That the sitting be now adjourned.—[Mr. McCabe.]

9.30 am

Mr. George Mudie (Leeds, East) (Lab): Once again, it is a pleasure to secure a debate under your benevolent and fair chairmanship, Mr. Gale. I am delighted to have obtained this debate and to see so many of my Leeds colleagues here, which indicates how important the matter is to Leeds. The matter affects the future of the local Leeds economy and, above all, the social cohesion of the city, which everyone has worked so hard for decades to improve and maintain and which is now threatened by the measure that we are discussing this morning.

In December, the Government announced the ending of the neighbourhood renewal fund. From April, a working neighbourhood fund will be in place. The Minister stated that the fund would

I am sure that nobody in the Chamber has any trouble with a change in emphasis. I have always been of the view that the way out of poverty is through work—if a person is physically able to undertake work—and not through the benefit system. The problems in doing that are immense, but the rewards are great for both the community and the individual. Work gives confidence, dignity and financial freedom to the individual and their family, and the knock-on effects on children are palpable to see. Therefore, I do not fall out with the change of emphasis.

The fund amounts to £1.5 billion over three years. As is usual with Government announcements, that sounds like a huge figure, but it is less than what was available in the renewal fund by quite a few million. With a new fund come new criteria, and Leeds now fails by the narrowest of margins to qualify for funds. The partnership arrangements between the Government and the city council, which aimed to deal with the problems of inner-city poverty, have been ended by a Labour Government. Those arrangements have been in place for more than 30 years under both Conservative and Labour Governments.

Mr. Mark Field (Cities of London and Westminster) (Con): I pay tribute to the hon. Gentleman for putting this debate in a non-partisan context. The problem that he has alluded to in relation to Leeds applies also to the City of Westminster, which has just missed out on funding. Does the hon. Gentleman agree with some local authorities that those decisions have come too late, not least because of the accumulation of different statistical values? In Westminster, and probably also in Leeds, various plans were made on the basis of continued funding for programmes. If the Minister
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cannot go back on the entirety of the proposals, we call on him to keep the funding for the next financial year for both Leeds and the City of Westminster.

Mr. Roger Gale (in the Chair): Before we proceed, may I remind hon. Members of the need for brevity? May I also draw attention to the fact that this is a localised debate. I am perfectly prepared to allow a slightly broader discussion about neighbourhood funding and, therefore, to allow the Minister to respond to any points, if he chooses to do so. However, a significant number of hon. Members are from the Leeds area, and it is only right that they should dominate the debate.

Mr. Mudie: You have made a fair point, Mr. Gale. However, I totally understand the point made by the hon. Member for Cities of London and Westminster (Mr. Field), to which I was going to refer. At the risk of repeating myself, what the hon. Gentleman has said is perfectly right. When the Minister made the rate support grant announcement a few weeks ago, he finished his speech by referring to a new partnership with Karen Dunnell from National Statistics. That decision was taken to take a closer look at the matter, because there are continuing questions and problems with the accuracy of statistics in the big cities, which is a problem that has been acknowledged and referred to.

The hon. Gentleman has made an important point, which I want to emphasise. Following the Minister’s announcement of the figures, three authorities have been told that they are getting different results. The hon. Gentleman has referred to Westminster, which is being taken out of the list. Another authority has also been taken out of the list, and Waltham Forest is going into the list. All sorts of questions can rightly be raised about the statistics.

As my right hon. Friend the Member for Leeds, West (John Battle) has reminded me, a statistical blip means that Leeds has lost more than £40 million, which we expected to get to deal with problems over the next three years. The financial effects of that are stark. We expected to receive funds worth £54 million. I chided the Minister in the Chamber, because when he told me that we were going to lose £40 million, he used statistics to say, “Ah, but we will give you £60 million in the first year and £20 million in the next year.” He omitted to say that in the third year, the funds went down to absolutely nothing, which is £12 million of the £54 million that we expected to receive. He also failed to refer to the money from the Department for Work and Pensions in the fund. Therefore, if an authority is not one of the 66 authorities that are part of the neighbourhood working fund grant list, they do not get the DWP money or any reward money. Some £50 million will be used to reward authorities for doing well on tackling poverty. I find it incredible that anyone should think that authorities need to be rewarded. Yet, that is exactly the amount of money that Leeds is losing, because we have been removed from the list.

The Minister for Local Government (John Healey): I listened very carefully to my hon. Friend when he made some of those points in our debate on 4 February. He said then that Leeds was losing £54 million that it expected to get. A little later, he said that Leeds was
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losing £52 million. I have been unable to work out exactly how he reached those figures. It would be incredibly helpful if my hon. Friend were to explain where his figures come from.

Mr. Mudie: I am sorry that the Minister has such bad civil servants that they cannot provide him with the figures. However, the good civil servants in Leeds will provide him with the details that he wants. We receive between £15 or £16 million a year in neighbourhood renewal.

John Healey rose—

Mr. Mudie: I will give way in a second, and then the Minister can challenge the figures. We are also in receipt of more than £700,000 in DWP money. On the basis of getting the same amount from the working neighbourhood fund, we expected to get £54 million from that fund alone. The Minister may say, “Oh, those are great expectations; the reality might have been different.” If he were to consider giving Leeds what he has given other major cities in Britain, I would happily accept that amount.

John Healey: I am simply trying to understand the figures. For the current year, Leeds receives £14.9 million under the neighbourhood renewal fund. That is part of a total of £63 million under that fund between 2001 and 2008. Under the DWP disadvantaged areas fund, Leeds will receive £758,000 this year. For the life of me, I cannot make any extrapolation from any of those figures add up to either £54 million or £52 million over the forthcoming three-year period, so I am simply asking my hon. Friend where he gets his figures from when he talks about what Leeds expected to get over the next three years.

Mr. Mudie: I am happy to cross swords with the Minister, who has more resources than the city and I would ever dream of having. I am happy to discuss any discrepancy in the figures that he cares to argue about. Leeds has supplied, and backed up, the figure of £54 million. If there is a dispute about whether it should be £60-odd million, £50-odd million or £40-odd million, we will negotiate with the Minister, because we are reasonable people in Leeds. If the Minister is in financial difficulties, I am sure that we can reach agreement, but what we cannot do is accept a move from £50-odd million to £12 million and then, in the third year, to absolutely nothing.

John Battle (Leeds, West) (Lab): My hon. Friend has rightly championed this cause, and we in the city are grateful to him for doing so. The £14.9 million that we would lose from antisocial behaviour units, the drug intervention project, neighbourhood wardens and the burglary reduction projects levers in other money from other pots, and when we add the sums together, including money from other Government budgets, we are well up on the £43 million, as I think it was, at the baseline. Does my hon. Friend agree that we have to keep in mind the fact that the money in this fund accesses money in other funds, which will now be denied because we will not receive the basic money?

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Mr. Mudie: My right hon. Friend is entirely correct, but if the Minister is having difficulty, let us not muck about with big figures; let us consider the schemes. This morning, I will supply him with a list of current schemes that face total cuts or 40 per cent. cuts next year down to oblivion in the third year. We are not discussing abstract figures. We are discussing schemes that work in all sorts of areas to deal with the problem of inner-city poverty, and those schemes will disappear because of this decision. That is what we are arguing about.

The social effects are alarming. We often refer to two-speed Leeds—it is openly described in that way. As is usual in every big western city, we have a posh, prosperous centre. We also have posh, more prosperous suburbs, but in between, as with every western city from America to Europe, we have the inner city, with all the problems that are identifiable no matter whether people are in Paris, Rome, Washington, New York or Leeds.

Mr. Fabian Hamilton (Leeds, North-East) (Lab): I thank my hon. Friend not only for introducing the debate but for the points that he has made. Following his point about western cities, does he agree that even within some of the more prosperous suburbs—for example, Alwoodley in my constituency, which is one of the richest in the country—there are pockets of deprivation that match anywhere in the poorest parts of the poorest areas of our country? On top of that, we have inner-city areas such as Chapeltown and Harehills, to which he has referred.

Mr. Mudie: My hon. Friend is exactly right. I may repeat myself, but it is worth making the point in case I forget it that the city council argues that if the old city boundaries were to apply, in which case the boundary ran around the urban, built-up areas, our figure would be not 19.96 per cent. but 36 per cent. That demonstrates the depth and the comprehensiveness of the poverty in all the areas within the inner city of Leeds.

What are the problems? I need not spell them out to colleagues, but the Minister should be aware of them. I am referring to high unemployment, bad health, indifferent education, crime, violence and vandalism. Those are all problems that the Government have targeted over their lifetime, but they are no longer visible to the Government. They do not exist now in the Government’s eyes, and no resources will be coming into the city in three years’ time to help with the objective of getting people skilled and into work and changing the nature of the inner city.

Mr. Mark Field: Will the hon. Gentleman accept that the statistical analysis by Governments of all colours in recent years no longer holds sway, for the following reason, which applies in London and, I am sure, in Leeds? In inner cities, the hypermobility and hyperdiversity of the population mean that many statistics are both unreliable and quickly out of date, which obviously has an enormous impact on much of this funding.

Mr. Mudie: Yes, the hon. Gentleman is absolutely right. We return to the question of how accurate statistics are. There is also the question of the base and the time. I need not remind my colleagues of how the
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inner city has changed in the past five years, because of the influx of people seeking asylum who have been sent to Leeds by the Government. Those people have changed communities, but let us consider the issue in economic terms and how it has affected the statistics. We all know the numbers. Thousands have come into our inner-city constituencies. That is why I cannot trust the statistics, which are seriously out of date. If those people are being considered for asylum, they bring £35 a week into each household—£35—and they have replaced people who have moved to other parts of the city. I cannot think of any indigenous family who have made do on less than £35 a week. I submit that that is impossible, so the areas have become economically weaker.

Why have the Government concluded that Leeds no longer needs help? The technical answer is that to qualify, the council has to meet one of three criteria. The criterion that Leeds has the overwhelming argument about is that super-output areas have to be in the 10 per cent. most deprived on the index of multiple deprivation. Stand up anyone who understands that. Shoot the man who described them as super-output areas.

Colin Burgon (Elmet) (Lab): Or woman.

Mr. Mudie: Or woman, but I am sure that a woman would have more sensitivity. [Interruption.] Positively so.

Leeds has 476 of those areas, so mathematically it requires 96 of them to come within the relevant category to qualify. It actually has 95, so it has lost £40 million of grant because, as the Leeds finance and regeneration people tell me—the Minister will have to check this; it has not been challenged to date—that figure equates to 19.96 per cent. If it were 20 per cent., we would have received £50-odd million over three years. Because of 0.04 per cent., we will get nothing in three years and disappear from the list. Our poverty will disappear and our inner-city problem will disappear.

Justine Greening (Putney) (Con): As a London MP, I recognise many of the issues that the hon. Gentleman has outlined, and I have a lot of sympathy in that regard. Does he agree that it is intuitively wrong that an area that is classed as deprived on 31 March one year is literally the next day suddenly regarded as good enough to receive no investment?

Mr. Mudie: I could not have put it better—that is exactly the question I am asking. I shall depart from my script to say that I have had both public and private discussions with the Minister on the matter. The answer to the question is that a line has been drawn: it is lovely if one’s city is above the line; but Leeds is below it. That puts tackling inner-city poverty to level of a television game show, like saying “Oops! You just missed and you are going home with no money!” That might make nice television, and it might be riveting for people of that mind, but it is scandalous when it comes to tackling poverty. What the Government are saying is that 149,000 people in Leeds, who are in the deepest poverty and deprivation and all that I described, and who represent the 95 SOAs, are suddenly of no interest to the Government. If there were 20 per cent., the Government would have been very interested in giving
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money. How can a Minister in a Labour Government, who owe their existence to attacking such problems, suddenly draw a line and say, “We do not recognise you”?

Leeds is the only major city in Britain not to be included in the list—Manchester, Birmingham, Liverpool, Sheffield and Newcastle are all included. I believe that it is the only major city in the western world not to have a partnership between the Government and the local authority to tackle inner-city problems, which we all have and work hard to deal with.

What has happened to Leeds? As the hon. Member for Putney (Justine Greening) has said, our poverty disappeared in the eyes of the Government on 31 March. How can a Labour Government call themselves a Labour Government if they decide to tackle poverty at a given level, but say that cities above that level do not need any money because the poverty does not exist? It is not acceptable—it is bizarre and grotesque. The Government cannot go to 149,000 people in Leeds who live in conditions that almost defy description—they have no ambition or hope and live in terrible conditions—and say that if there were 0.04 per cent. more people, we would help. That is how to decide game shows, not social policy. There cannot be such a cut-off.

If the Government do that, what will they say to people? What will MPs say to people when we visit them and they tell us about their genuine problems—they do not have to tell us about those problems, because we live among our constituents and see them every time we go home? We sense that things have not changed much, and we are angry about it. Things did not change that much when we received £50-odd million to help change things, so what on earth will happen to the city when the money disappears? Things will inevitably get worse.

John Healey indicated dissent.

Mr. Mudie: I see that I am amusing the Minister. That shows the gulf between some of us and the Government—I say that genuinely. I have some questions for the Minister.

John Healey: Will my hon. Friend give way?

Mr. Mudie: No. How can the Minister justify—

John Healey rose—

Mr. Roger Gale (in the Chair): Order. The hon. Gentleman is not giving way.

Mr. Mudie: I am certainly not, Mr. Gale. I shall give way, if the Minister answers my questions, which I hope he will, but he will have time later. How can he justify making Leeds the only western city to receive no Government help? How can a Labour Government refuse help to 149,000 people who live in deprived areas and 65,000 working-age people who are on benefits? We are supposed to be targeting those people, but Leeds has only 65,000 of them, so it is too small to target and to receive help.

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