Ministry of Housing, Communities and Local Government

(3) a further sum, not exceeding £9,295,168,000 be granted to Her Majesty to be issued by the Treasury out of the Consolidated Fund and applied for expenditure on the use of resources authorised by Parliament.—(Wendy Morton.)

I inform the House that Mr Speaker has not selected either of the amendments.

I start by thanking the Backbench Business Committee for allowing this debate on this incredibly important matter. I thank the hon. Members for Hackney South and Shoreditch (Meg Hillier), for Sheffield South East (Mr Betts), for Birmingham, Ladywood (Shabana Mahmood) and for Newton Abbot (Anne Marie Morris) for supporting the application, along with all the members of the Public Accounts Committee. I also thank the hon. Members for Redcar (Anna Turley) and for Warwick and Leamington (Matt Western), who submitted similar applications that have been lumped in with this debate. I also give my thanks in advance to everyone who wants to speak today; I will be as quick as I possibly can.

Local government spending is a story of unsustainability and inequality. According to the Local Government Association, which is holding its conference as we speak, funding to local government and business rates have fallen by £4.1 billion since 2015. Councils have far less spending power, but here is the rub: our local councils are having to deal with a big growth in demand for key services. Taking into account the decrease in Government grants, subsidised a bit by the increase in council tax, our councils have lost nearly a third of their spending power over the last nine years, and key services are suffering.

We all know what that means, at its heart, for the most vulnerable in our communities. Since 2010 the number of homeless households has risen by 33%, the number of looked-after children is up by nearly 11% and the number of people aged 65 and over in need of care has increased by 14%. It is great that we are living longer, but central Government have not grasped the nettle.

The combination of with higher national insurance contributions, the apprenticeship levy and the national living wage means that councils are at breaking point. Given the major stresses on children’s services and adult social care, I will focus on those today, but there are many others, and I look forward to other Members making contributions about their local area.

For childcare and other local authority services, central Government have shifted funding away from a grant system and on to business rates. Shopkeepers, in particular, are now finding it difficult to carry on their business. Central Government have also failed to deliver on social council housing, which is an indictment.

I thank the hon. Gentleman for his contribution. In fact, spending on services has decreased by 19.2% in real terms, which is not sustainable.

In my local area, Vale of White Horse District Council is a good example. We won the council from the Conservatives in the last round of local elections, and now we have sight of the finances. I am sure this is not unique in the country, but there is not enough money to fund the basic statutory services that the council is expected to deliver. The council is therefore eating into its reserves at an alarming rate. Coupled with that, an outsourcing agreement that was meant to save the council £50 million, and in fact has saved nothing, is projected to cost the taxpayer money. We are in a dire situation in the Vale.

The situation in the hon. Lady’s area is mirrored in Harrow, where the council has lost over 97% of its revenue support grant since 2010 and is really struggling. Is it not therefore particularly sad that neither of the two Conservative candidates for the premiership are talking about these issues at their hustings?

I hope today’s debate will be a clarion call to them and others about the importance of local government in delivering key services.

The resilience of local councils across the country is a focus of the National Audit Office’s work, and it has real cause for concern. The message I have received from my friends at today’s LGA conference is twofold. First, we must remember that councils are multi-million pound companies, yet they do not know where their funding is coming from past next year. How on earth are they expected to plan without any sense of the medium term, let alone the long term?

Secondly, if we are to shift the burden from central Government to local government, income generation needs to be made easier. Across the country, I am not aware of a single council that has successfully used the referendum mechanism to raise council tax. This is not working. We need another way to make sure councils are properly funded.

Between 2011 and 2015, according to the NAO, 25% of the central Government grant to councils was cut. Does the hon. Lady regret the role of the Liberal Democrat coalition Government in such a heavy level of cuts?

When I was a candidate, I, too, fought against these cuts, particularly those to children’s services. As the hon. Gentleman knows, I am a teacher, and I was seeing the effect the cuts would have. Interestingly, the data show that some of that was fat that could be trimmed off. [Interruption.] Let me finish. [Interruption.] Just look at the transcripts from the Select Committee on Housing, Communities and Local Government. In 2012-13, there was an increase in efficiency, but I will concede that after that point the cuts should have stopped. The point of today’s debate is to move forwards. Having been elected in 2017, I hope the hon. Gentleman will join me in looking forwards and not backwards.

I am moving on. I am not going to give way.

The hon. Lady just referred to the Select Committee.

I will come back to the hon. Gentleman in just a second.

Let me move on to adult social care, because it is really important. The Chancellor’s extra £750 million for social care in 2019-20 falls drastically short, given that the funding gap for adult social care is expected to reach £3.6 billion by 2025, according to the Local Government Association. This is a vital government service and central Government responsibility is shared between two Departments. I have many questions for the Minister, but one is: where on earth is the adult social care Green Paper? The situation is no longer sustainable. The adult social care sector in England accounted for 1.34 million jobs in 2016-17, yet, according to the National Audit Office, it has been 10 years since a national workforce strategy has been published. Furthermore, 43% of those aged 80 or over in England in 2016 needed help with activities for daily living, yet only 20% actually received the help they need. Demand is increasing and less is being provided—and to fewer people.

And of course I happily give way to the Chair of the Select Committee.

I am not sure the hon. Lady will be quite so happy when she hears what I have to say about the matter. Again, this is typical of the Lib Dems, is it not? We see collective memory loss about what happened between 2010 and 2015, and them now washing their hands. Does she accept that the biggest cuts in real terms per year in adult social care happened between 2010 and 2015, and she and her colleagues in the Lib Dems bear equal responsibility for that?

I thank the hon. Gentleman for his point. As I say, I am looking forwards.

On adult social care, the Liberal Democrats are proposing—I would be curious to know whether Labour is planning the same—a penny in the pound on income tax to add to the social care budget, in order to sort out the short-term funding issues. That has to be just a short-term solution. The longer-term solution is not this tit-for-tat political to-ing and fro-ing; it has to be a cross-party effort to find a long-term settlement that will last for decades, not years.

I entirely agree with the hon. Lady on this. The Select Committees on Health and Social Care and on Housing, Communities and Local Government issued a joint report on the future funding of social care. One of its recommendations was a social care premium—an insurance based model like the German model. Would her party engage with that, on a cross-party basis, involving Conservative Members and Members on those Benches?