The Labour Group and the Leader of the Council gave me political responsibility for the council’s finances less than 10 months ago.
I feel fortunate to have reached this milestone, delivering my first council budget today, a milestone that Sajid Javid didn’t manage to make. Just 10 short months, but already onto my 3rd Chancelllor of the Exchequer. It has indeed been a time of considerable political change and flux.
Our residents went to the polls in May last year and returned 50 Labour Councillors. They again went to the polls in December and all Nottingham City constituencies returned Labour Members of Parliament.
I know that I speak for my colleagues when I say that representing our residents interests is always our top priority.
For Nottingham this is a time of great challenges. I’m going to set out those challenges and explain what the council is doing to meet them.
After a decade of Government austerity, 10 years of Government funding cuts those challenges have become increasingly difficult to navigate, balancing a number of competing priorities.
Chronic underfunding of local services by the Government over such a prolonged period of time has consequences. It’s caused social and economic issues that in my view were and are unnecessary. Social and economic issues that in the medium to long term will cost the public purse more. The recent updated Marmot Review highlighted for instance that, and I quote ‘the amount of time people spend in poor health has increased across England since 2010. inequalities in poor health harm individuals, families, communities and are expensive to the public purse. They are also unnecessary and can be reduced with the right policies.’
Austerity has impacted the poorest people, hardest and that’s wrong.
Let’s just remember what’s happened over the lost decade of austerity, the decade of low growth, the decade of stagnant wages, the decade of underinvestment, the decade of increasing child poverty, the decade of school cuts.
Let’s remember that Nottingham has been in the Conservative Government’s firing line throughout and let’s also remember that this is not a new Government, it’s Michael Gove, it’s Liz Truss, it’s Grant Schapps, it’s Boris Johnson. These people have been in Government for years and years. They are austerity.
Since 2010 Government has consistently cut the funding for Nottingham’s public services. Nottingham now receives over £100million less in Government funding per year than it did. £100million less every year to fund libraries, parks, public toilets, the local road network, public transport, youth centres, street cleaning, trading standards, environmental health, drug and alcohol services. We’re a hundred million pounds a year down on the resources we can put in to tackling anti social behaviour, supporting the homeless and looking after our most vulnerable residents.
Over £100million less each and every year.
£529 per Nottingham household cut.
Since 2012 this council has had to make savings of over £270 million pounds.
It’s this Government’s attack on Nottingham’s households that’s led to a gap in the council’s budget yet again for the next financial year to the tune of £15.6million.
After a huge amount of work by my colleague Portfolio Holders and Council Officers I’m able to set out budget proposals today to close this gap and deliver a balanced budget for the next financial year.
We have significant additional demands in our children’s services department. Like many councils up and down the country, but especially in big cities, urban areas and areas with higher than average levels of deprivation we have growing demand in children’s services. More vulnerable children have been brought into the care of the council and other additional costs associated with protecting children means that we’re putting more money into those services next year.
Almost all councils are currently spending more on children’s services than they had budgeted for and therefore are having to allocate additional resources.
We’re also putting more money into care services for elderly people in recognition of a growing number of people requiring council funded care.
These two areas of spending – looking after the care needs of older residents and protecting vulnerable children are now by far the biggest areas of spend for the council.
It’s now urgent that Government brings forward proposals to deal with the growing funding gap that councils face. As demand for care services continues to rise the Local Government Association has warned of a funding gap of £6.4 billion by 2024. After many years of promises from Government to bring forward new policy proposals to fund care services for elderly and vulnerable people it seems that realistically we are nowhere near a solution. Successive governments have failed to deal with this fundamental issue.
It is the growing demand for children’s and adults services, the government’s failure to lead and the chronic underfunding of these services that is driving instability in the finances of councils across the country.
Remember that these are literally life or death services for many of our residents, they are vitally important, but trying to fund them from council tax and the half of business rates that Government allows us to retain locally is unsustainable and unfair.
We have no choice therefore, but to apply the Government’s adult social care precept to council tax bills yet again. The Government expects us to apply this additional 2% on to council tax bills.
The Governments adult social care precept has now added £160 to an average council tax bill in Nottingham.
And it’s just about the worst way to fund these key services. Council tax isn’t based on ability to pay, its regressive so that poorer households pay proportionally more than wealthy households and it embeds inequality and unfairness regionally and nationally with councils in the poorest parts of the country able to raise the least new income.
When you consider that 1% added to council tax bills in Richmond will translate to over £6 per person in new income for their council, yet here in Nottingham a 1% increase in council tax raises around half that level of new income to fund local services.
Which area do you think has greater demand on its children’s and adult care services?
Not only is this a government stealth tax, it’s an unfair tax that does nothing to level up, in fact it does the opposite.
Let me be clear – The council tax rises proposed in this budget are a result of Government funding cuts. I will continue to inform the Government of my belief that council tax is no way to fund care services for older people.
I need to point out further unfairness of the Government’s approach and I highlighted these points to the new Chancellor in a letter I recently sent to him. In anticipation of his first budget on Wednesday I urged him to change course and end the unfairness, because while Nottingham has faced relentless funding cuts some of the wealthiest parts of the country have received additional funding.
The attack on Nottingham to the tune of a £529 cut per household can be shockingly compared to a £19 increase in funding per household in Surrey for example. This must end. The Government’s funding formula, if unchanged, is expected to slash another £14 million from Nottingham, yet Surrey, one of the wealthiest parts of the country is set to receive an additional £26million.
And not just Nottingham – residents in Nottingham would be rightly angry. As angry as residents in Durham – set to lose over £10 million, Dewsbury, set to lose another £6million and Doncaster set to lose another £5 million. Some of the poorest parts of the country set to be targeted yet again.
My message to the Government is clear – stop your attack on Nottingham, stop your attack on Nottingham households and stop your unfair funding regime.
I sincerely hope the new Chancellor changes course on Wednesday. The people of Nottingham will be watching.
So our challenges are significant, but we’ve done a lot to meet these challenges. In many ways I’m proud of the way the council,our partner organisations and our communities have responded. There has been damage done by Government policy, but also great resilience in our city.
Whatever Conservative Governments throw at Nottingham, we will succeed, but we won’t forget.
In our budget proposals today we’ve worked hard to protect vital, front line services, to protect those services upon which our most vulnerable residents rely, with our dedicated council officers we’ve been innovative to bring in grant funding, to grow commercial income, to further embrace new technology and be as efficient as possible whilst demanding high standards of our services.
Despite the challenges we’re doing so much. We have an ambitious agenda, we’re still investing in Nottingham’s future, we’re confident in Nottingham and in Nottingham people, we’re helping to create new jobs, delivering the biggest regeneration programme for decades and growing the city.
Each of my colleagues on the Executive and our assistant portfolio holders could point to excellent work happening in the council and I know that all of my colleague Councillors could demonstrate the positive work happening in their communities.
When I see thousands of Nottingham children receiving a free book direct to their home every month, when I see that we’re a child friendly city, when I see that we’re working towards being the first city in the country to be carbon neutral, to improve health with the cleanest city air, to build the best children’s library in the country, those things give me great hope for our future.
And all of those things that we can do as a council when combined with the resilience in our communities, the positive work of our partner organisations, our voluntary sector, the diversity of the city and our history of innovation and creativity I know that despite being held back by this Government, Nottingham will continue to progress.
And because we are a progressive city, we are an inclusive city we will meet these challenges together.
Lord Mayor I move the report.
Councillor Sam Webster
Portfolio Holder for Finance, Growth and City Centre
Nottingham City Council