Pickles using smoke and mirrors to hide scale of cuts to councils

Shadow communities minister Barbara Keeley argues Eric Pickles is hiding the true scale of the cuts to councils, which hit the most deprived areas the hardest.

Barbara Keeley MP is the Shadow Minister for Communities and Local Government

The cuts to council budgets announced by communities secretary Eric Pickles are deeply unfair, as they hit hardest at councils in the most deprived areas of the country. Ministers were urged by both Labour and the Local Government Association to re-profile the cuts to reduce the impact next year, but the cuts are still front loaded. This means that councils have only three months to implement the deepest cuts ever.

The Local Government Association points out that the main grant from central government has fallen by 12.1 per cent in cash terms next year, which is more than the 10.7 per cent cut announced in the Comprehensive Spending Review.

In announcing the cuts ministers created a new measure called “spending power”, which rolls grants from government in with totals from council tax and the new NHS funding to support social care. The total for next year is then compared to a total for 2010-11, which did not include the extra funding for social care.

This is using smoke and mirrors to hide the scale and front-loading of the cuts being made to council budgets. Working out percentage cuts to budgets by using a total inflated by council tax and NHS social care funding masks the extent of the cuts in funding to grants from central government.

Where the resulting percentage cut was not low enough to fit the presentational framework, a ‘transitional grant’ was applied to make the figures fit. The transitional grant amounts to just £85 million or just 0.3 per cent of total local authority expenditure. Only 37 councils will benefit from it.

While the Government claims that no council will suffer budget cuts of more than 8.9 per cent, the cuts are greater than this for many councils in deprived areas.

Monday’s announcement also saw ministers using a new language to describe need. Councils serving the most deprived areas of the country were described as “dependent” and those serving affluent areas were “self-sufficient”. Councils were said to be dependent on “handouts” from central government. The Conservative/Liberal Democrat government has presented councils in our most deprived areas with the deepest cuts ever to their budgets and then used language which stigmatises their situation.

Government ministers are also telling councils how they should deal with the budget cuts. Eric Pickles says that councils should not “slash and burn services”, but should:

“… completely rethink everything they are doing, creating a modern, flexible and innovative council.”

As I pointed out to him in our debate on the cuts last week, the depth and timing of the cuts means that councils will have no time for major restructuring. Frontline services will bear the brunt.

Eric Pickles had said earlier that financial freedoms would allow councils to “better protect frontline services like care for the elderly.” The Minister for Care Services, Liberal Democrat Paul Burstow has also said “there is no justification for local authorities to slash and burn or to tighten eligibility” for adult care.

These exhortations do not work in practice. Conservative-run North Yorkshire County Council plans to close more than two-thirds of its residential care homes. Birmingham City Council, run by Conservatives and Liberal Democrats, has announced proposals to restrict social care funding to those assessed as ‘critical’ – the highest possible level at which to set eligibility.

Nick Clegg has also criticised councils for acting early, saying they:

“… shouldn’t immediately start issuing redundancy notices for savings that they can phase in over four years.”

Yet the Local Government Association estimates that 140,000 jobs will be lost in local authorities next year. Ministers are allowing councils only £200 million in capital to pay for redundancies – one tenth of the amount they are likely to need to meet these costs.

Local government leaders from all main parties had asked for the frontloading to be reduced, for more capital to pay for redundancies, and for a fair formula for distribution meaning cuts do not fall disproportionately on the councils with the highest need.

The Government has not listened, leaving councils in deprived areas to make the difficult decisions about where the axe will fall on local services and jobs.

10 Responses to “Pickles using smoke and mirrors to hide scale of cuts to councils”

  1. checkpointcharlie

    RT @leftfootfwd: Pickles using smoke and mirrors to hide scale of cuts to council fatties: http://bit.ly/ehSGZs writes Barbara Keeley MP

  2. Lee Hyde

    RT @leftfootfwd: Pickles using smoke and mirrors to hide scale of cuts to councils: http://bit.ly/ehSGZs writes Barbara Keeley MP

  3. Anon E Mouse

    I don’t know why they bother to hide it.

    Since watching Ed Milibands dire performance at PMQ’s again it must now be obvious there is no official opposition to this government.

    Miliband is a truly useless. The Labour MP’s in the commons were right about him.

    I hope now the union dinosaurs who elected this no hoper realise the error of their ways…

  4. Tom Ladds

    The smoke and mirrors of Eric Pickles http://tinyurl.com/298bxo5

  5. Local authorities face much higher cuts than Pickles claimed | Left Foot Forward

    […] As pointed out by shadow communities secretary Barbara Keeley on Left Foot Forward: “[The government is] working out percentage cuts to budgets by using a total inflated by council tax and NHS social care funding masks the extent of the cuts in funding to grants from central government.” […]

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