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4 Feb 2009 : Column 890
3.21 pm

Mr. Coaker: I thank all hon. Members who contributed to this debate for the informed and interesting way in which they made their points. I shall try to answer the questions that have been raised and deal specifically with some of the points.

I agree very much with the hon. Member for Hornchurch (James Brokenshire) about the fact that all of us should start these debates, as we have done, by paying tribute to police forces across the country for their work and the fact that they often put themselves in very dangerous situations to ensure public safety as far as they are able.

The hon. Member for Bury St. Edmunds (Mr. Ruffley) again sought confirmation about capping. He will know that Cheshire, Leicestershire and Warwickshire were capped in advance for 2009-10, limiting their council tax increases to 3 per cent. That situation stays the same. They had 21 days from 26 November in which to appeal and none did so—that was the point that my right hon. Friend the Member for Leicester, East (Keith Vaz) made; the approach we took significantly helped in that regard.

The hon. Member for Bury St. Edmunds asked what capital moneys had been brought forward. Capital moneys for the Serious Organised Crime Agency and the National Police Improvement Agency have been brought forward, and they have been spent on helping with the current economic climate. He asked whether police authorities can apply for the migration moneys that I mentioned. Yes, they can. I want to spend a little time on this issue. We expect the Office for National Statistics to produce estimates of short-term inward migration by this summer, and we want to improve the population data informing the police funding formula debate. The review of the formula gives us an opportunity to try to address some of the issues raised by hon. Members from across the House. That review will enable us from the next comprehensive spending review round—from 2011-12—to move forward on that basis. That is where our intention lies. Meetings have started to be held on what changes we should be reflecting upon, and this afternoon’s debate will help with that debate. All the issues such as how we can better estimate population and the impact of migration will be included in our discussions, as will other matter that have been raised.

The hon. Member for Peterborough (Mr. Jackson) said that no change had been forthcoming. I know he could not help not being here earlier in the debate, but had he been here he would have heard that from April the migration impact fund will be available in Government offices for the regions; police forces, as well as other local service providers, will be able to apply for money to help them deal with some of the very issues that he raised with regard to Cambridgeshire. Cambridgeshire police authority will be able to go to the Government office for its region to put a case for receiving that money, as will authorities in other parts of the country.

Mr. Stewart Jackson rose—

Mr. Coaker: I shall give way, but I have only 10 minutes and I wish to make some other points.

Mr. Jackson: My point was that the Migration Impacts Forum was established 18 months ago, but the information available to Ministers on the flawed methodology used
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by the ONS and others was available before that. These are current problems from which my local force is suffering, and it was incumbent on Ministers to have acted much more quickly.

Mr. Coaker: It is also incumbent on Ministers to act responsibly. What I have said to the hon. Gentleman is that from April his local police force will be able to apply to the Government office for his region for funding. If we unpick the funding formula in the middle of a CSR round, although his force may get an extra few million, countless other Conservative Back Benchers and Members from all parts of the House will say that the Government have broken their word on what they said they were going to do, which was to provide stable funding for the police service. That is why the Home Office has received limited representation about this funding round and why we have heard more concern about what happens in the next funding round—that is what the hon. Member for Brecon and Radnorshire (Mr. Williams) was arguing about and it is what most other Members in this debate have discussed. They recognise that if a Government unpick a settlement in the middle of it, that causes instability and chaos. That is why we have not unpicked this one, and why we are not going to do so.

Paul Holmes rose—

Mr. Coaker: I want to carry on—I hope the hon. Gentleman does not mind.

The point of today’s debate is that it allows us to inform that funding formula. My right hon. Friend the Member for Leicester, East raised the issue of new technology, and we agree with him on it. He, like the hon. Member for Hornchurch, raised a specific point, and I should like to read out a reply so that I put it accurately. The police portal was a website providing a national communications channel. The main service was to enable the reporting of crime and hate crime online. Good use was made of it, but running costs increased as a result of technical problems. The Association of Chief Police Officers took the view that there was not enough demand to justify the increasing costs, so the scheme was discontinued. QinetiQ’s contract was terminated by the NPIA in July 2007. QinetiQ then sued the NPIA and it countersued. These legal matters were resolved in November 2008 in a non-disclosed agreement. Some forces do have online facilities on their website to allow the reporting of crime.

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Keith Vaz: I am most grateful to the Minister for telling us that information. How much taxpayers’ money was spent on setting up a computer system that was of no use?

Mr. Coaker: To provide the detail that my right hon. Friend requires, over and above the legal opinion that I have just given, I might need to write to him. I will put a copy of that letter in the Library.

The issue of alcohol was also raised by several hon. Members. We take the need to address that issue seriously and we are taking a range of enforcement measures. The Policing and Crime Bill will allow the Government to establish a mandatory code for the off-trade and for pubs and supermarkets. That will help to tackle the irresponsible promotions and pricing that lead to some of the issues that have been raised by hon. Members.

The hon. Member for Preseli Pembrokeshire (Mr. Crabb) mentioned Dyfed-Powys force and the important role of volunteers. We all agree that volunteers are particularly important and we need to ensure that we encourage specials and other volunteers.

The hon. Member for Brecon and Radnorshire raised the issue of the future of the rural policing grant. As we have discussed, that will form part of the review.

I confirm again to the hon. Member for Reading, East (Mr. Wilson) that the south-east allowances will form part of the discussions with the Police Negotiating Board. I hope that the issue will be resolved as quickly as possible to address the problem of the transfer of officers from neighbouring forces to the Metropolitan police.

The settlement before us represents a further significant increase in resources for the police services of England and Wales. The latest figures show not a decrease in police numbers, but an increase. In all forces since 1997, there have been significant increases in police officer numbers, and in staff numbers, as well as the introduction of PCSOs. At the same time, we have seen big reductions in crime. That is a record to be proud of and, notwithstanding the difficult economic times, this funding settlement will allow our police services to continue that fine record.

Question put and agreed to.


That the Police Grant Report (England and Wales) for 2009—10 (House of Commons Paper No. 148), which was laid before this House on 21 January, be approved.

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Local Government Finance

Mr. Deputy Speaker (Sir Michael Lord): For the convenience of the House, we will deal with motions 4 and 5 together for the purposes of debate. We will, of course, put the questions separately at the conclusion of the allocated time.

3.31 pm

The Minister for Local Government (John Healey): I beg to move,

Mr. Deputy Speaker: With this we shall take the following motion:

John Healey: We are debating the 2009-10 settlement for local government, the second year of the first ever three-year funding deal for councils. Through the Government’s policy on three-year settlements, I have made certain commitments to local government. First, every council in every region will get an increase in its core grant in each of the three years. Secondly, total Government funding for councils in England rose by 4 per cent. this year, will rise by 4.2 per cent. next year and is set to increase by 4.4 per cent. in 2010-11. Thirdly, councils will have more freedom to take local spending decisions. By 2010-11, £5.7 billion a year will have been mainstreamed into funding with no Government funding strings attached. Fourthly, councils will have more certainty about other funding, so in addition to the core grant, I am also confirming today the allocation to councils of 70 other grants from eight different Departments. Most importantly, I have given the commitment not to change my proposals on formula grant distribution, except in entirely exceptional circumstances.

Local councils therefore know what they will get, and they can plan and manage ahead. The stability that that commitment brings is doubly important in dealing with the economic downturn, which I will come to in a few minutes.

Mr. Edward Davey (Kingston and Surbiton) (LD): The Minister mentioned exceptional circumstances. Is he aware that in the royal borough of Kingston, as in many other London boroughs, there was a massive and unexpected increase in demand for primary school reception year places in September 2008, which is expected to be repeated in September 2009 and beyond? The capital allocations, and the revenue to support those places, are simply not available. Will he talk to colleagues in the Department for Children, Schools and Families and argue that this is an exceptional case, and that Kingston and other London boroughs need the support of the Government?

John Healey: In a moment, I shall explain the conclusions that I have come to on whether there are exceptional circumstances in relation to the three-year settlement. I
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shall also deal with how I expect councils to show—and how they are showing—that they can deal with the downturn. I am aware of such representations, not least from London councils, representatives of which I met face to face. Their first point, when I asked them about the apparent impact of the economic downturn on their councils, was that an increasing number of students were coming out of private school education and looking for places in the state school system. That was their top priority.

Mr. Davey: The Minister suggested that he was going to answer in terms of the decisions that he has made. We already know that the decisions that he has made will not help the situation. My colleagues and I from all parties around the capital are asking the Government to consider the case of primary school places in London. The change happened before the Government did all the work in preparation for the announcement. Changes within the settlement and the comprehensive spending review need to be made in year. Otherwise, there will be severe problems for many children and families across the capital.

John Healey: One of the principal strengths of a three-year settlement, as well as the additional flexibilities that allow local authorities to identify the priorities or pressures in their area, is that the authorities are given the capacity to manage through that period. For that reason, I have not regarded the representations that I have received on the demand for school places as exceptional circumstances warranting an unpicking of the three-year settlement and undoing the stability and certainty that is at its heart.

Mr. Simon Burns (West Chelmsford) (Con): One of the other unfortunate by-products of the current economic downturn is the fact that local authorities such as mine, Chelmsford borough council, are being adversely affected as the fall in interest rates has changed the income that they receive from savings. What advice does the Minister have for local authorities affected in that way? Clearly, the three-year settlement would not have taken that consideration into account.

John Healey: That is one of the points that have been put to me, not least by the Local Government Association, as the hon. Gentleman might expect. The impacts and pressures of the economic downturn do not all go one way. Some costs are down considerably, reserves are up and with inflation set to be lower next year, the quantum of Government grant to local government is likely to go further. There are pressures on local councils, just as there are on central Government, but they do not all go one way. Councils have the capacity to manage their way through this period, not least because they now have a three-year settlement with extra flexibility as part of the funding. They know what they are getting and are able to plan ahead and make some of the difficult decisions that they face.

In my statement to the House on 26 November, I launched the period of statutory consultation on the local government settlement for next year. That ended on 7 January, and we received 109 written representations from local authorities, local authority groupings and hon. Members. That is the smallest number of representations on the local government finance settlement that anyone
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can remember. It underlines the seriousness with which local government takes our commitment to a stable three-year settlement and, I think, the seriousness with which local government takes its responsibility to manage within that settlement.

Simon Hughes (North Southwark and Bermondsey) (LD): I am sorry that I missed the Minister’s first words, but I rushed here as soon as I saw that he had started to speak. I think that there might not have been many representations because, with a fixed three-year settlement, local councils might have thought that they would not see much change. Does he accept the case put by inner- London boroughs in the representations that he has received for a better allocation of money for social services and the care of vulnerable younger people? The figure that I have been given—he can correct me if I am wrong—is that last year £370 million was transferred out of London to the rest of the country. While some local authorities now have 99 per cent. of their funding met, boroughs like mine get only two thirds of what they need to look after vulnerable young people.

John Healey: No, I do not agree. This change in the funding formula is based on some detailed work that we published and consulted on several years ago, which formed the basis of the decisions that I took at the beginning of this three-year settlement. Although the same arguments have been made to me by others, I have seen no evidence that the formula is not the best available, or to suggest that the shift in funding—which some people say is long overdue—is not appropriate for this year and next year.

Stephen Hammond (Wimbledon) (Con) rose—

Simon Hughes rose—

John Healey: The hon. Member for North Southwark and Bermondsey (Simon Hughes) had two bites at the cherry during the debate on the police authority settlement. I shall give him his second bite in this debate, and then give way to the hon. Member for Wimbledon (Stephen Hammond).

Simon Hughes: The Minister for Security, Counter-Terrorism, Crime and Policing was very helpful in response to my second bite at the cherry. He said that he accepted that he would revise the funding formula to take account of new and up-to-date assessments of migration and population figures before the next three-year funding period, at the latest. Will this Minister do the same? He knows the arguments: we think that Ministers do not count the population of boroughs such as mine correctly, as we have many more people than the official figures show.

John Healey: My hon. Friend the Minister for Security, Counter-Terrorism, Crime and Policing is always helpful. The hon. Gentleman has just asked a separate and different question, but I can give him the same answer. It is yes, and not least because the national statistician has been leading a taskforce over the past year, with local government intimately and essentially involved. On 24 February, the Office for National Statistics will announce a package of improvements to the population and migration statistics that will give us a better base for calculations for any future financial settlement beyond this three-year period.

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Stephen Hammond: I am extremely grateful to the Minister for giving way. He will have noticed that one of the other representations made to him was a joint representation from the chief executive and the leader of Merton council. A continuing problem for many outer-London boroughs and constituencies is that, although we pay our hard-working teachers inner-London rates, we get the outer-London settlement in the local government formula. Has the Minister had a chance to consider the representation from the chief executive and the leader of Merton council? If so, what is his response? Will he consider meeting them, and me, to talk about the problem further?

John Healey: I have not yet considered that representation, or any of the others that we have encouraged from local authorities. The hon. Gentleman’s point is linked to our review of the area cost adjustment, which is essentially the mechanism that he and his council’s chief executive and leader are concerned about. The way in which it operates is not entirely satisfactory, and we looked at options before striking the present three-year funding deal with councils. We consulted on various changes to the mechanism but none was appropriate at the time, although we are looking hard for the sort of changes that may be appropriate in the future. The work that the hon. Gentleman’s council, and others, are doing with departmental officials is extremely valuable, and I and other colleagues in government will take a hard look at it as we prepare the ground for any future finance settlement beyond the current three-year period.

Mr. David Burrowes (Enfield, Southgate) (Con): I am grateful to the Minister for giving way, and I apologise for not being present for the opening of his statement. The concerns expressed by my hon. Friend the Member for Wimbledon (Stephen Hammond) also affect the borough of Enfield. It too is an outer-London borough that welcomes the review of the area cost adjustment, but we need to see the reality of that review before we get to the end of the three-year cycle. Ideally, Enfield council would like to make reductions in council tax, but the fact that the dampening effect takes £5 million out of its hands means that that money cannot be passed on to the taxpayer.

John Healey: I am not sure that the hon. Gentleman’s description of damping is quite correct. He might like to recall that it was we who introduced the damping floor into the local government settlement in about 2000. Before that, authorities such as his would face big reductions year on year. They faced volatility that was difficult for them to manage, and that certainly made it difficult for them to plan ahead. If his authority benefits from the floor, I have to say to him that without that floor, his authority would be entitled to a good deal less support for council spending and council services.

I have taken into account all the representations that we received, including what was said at the meetings that the Under-Secretary of State for Communities and Local Government, my hon. Friend the Member for Tooting (Mr. Khan), and I had with local government groupings. My conclusions from the consultation are that there are no exceptional circumstances of a kind that would justify changing the plans that I announced for the core grant and its distribution in the coming year.

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