Tuesday, 21 December 2010

Humpty Dumpty

It has often been said that only three people understood local government finance – one was dead, another mad and the third had joined a silent monastic order. That is why Ministerial statements always have to be taken with a pinch of salt until all the information is on the table and a detailed analysis can be undertaken.

How necessary that was last week when Eric Pickles announced the financial settlement for councils for the next two years. What we’ve now discovered is that his statement needed to be taken with the complete contents of a grit-lorry.

Earlier this year, the Coalition Government announced that it intended to cut council expenditure by 28% over the next 4 years and that the first-year cut would be the biggest.

So, when Eric Pickles announced that the average cut for each council for 2011/12 was just 4.4%, we knew that couldn’t be true. Now, we know the statement was a complete travesty. Detailed analysis shows that next year’s national cut is 12.1%.

Sheffield fares even worse. It gets a grant cut next year of 14.5%, followed by a further 6.5% in 2012/13 – a 20% cut over the next 2 years. Doncaster does even worse.

And, it isn’t just all of South Yorkshire’s councils that are facing massive cuts. South Yorkshire Police gets a 7.5% cut next year and a further 8.7% the following year. And South Yorkshire Fire Service gets a near 10% cut next year.

Eric Pickles then compounded his misrepresentation by insulting our intelligence.

First, he told us that councils could manage these cuts by sharing chief executives and buying a different brand of paper clip. Just ask yourself this – if you got a 20% cut in wages, could your household budget deal with this just by cutting the children’s pocket money and buying a different brand of baked beans? Of course, you couldn’t. The suggestion was ridiculous.

Secondly, he told us that the settlement was ‘fair and progressive’, when it is exactly the opposite. There is a huge transfer of government grant from North to South – betraying Nick Clegg’s pledge that he would not let spending cuts unfairly impact on the north - from poor to wealthy areas, and from urban to rural areas. Sheffield is hit with a 20% cut and Dorset gets an increase.

Thirdly, Pickles suggested that councils should make ‘filling potholes a priority’ – well, we all know about that debate in Sheffield – when he has cut the capital funding allocations for highway maintenance by 19%, some £164m a year.

Eric Pickles has obviously learned from his alter ego Humpty Dumpty – ‘words mean what I want them to mean’. This settlement is unfair and regressive. It is very bad news for our local communities and services.