Member Article

Local government settlement is unfair, say ANEC

The local government settlement is unfair and benefits more affluent southern areas, say the Association of North East Councils (ANEC).

ANEC chair Cllr Paul Watson, and vice chair Cllr Simon Henig, met with the Minister for Local Government, Brandon Lewis MP.

ANEC said they were keen to be part of the solution in addressing the challenging fiscal and economic circumstances affecting the country, but in order to support growth councils must be adequately resourced.

Cross-party representation by ANEC highlights ways in which the mechanisms and design of the formulae used for allocating resources have unfair impact on councils in areas of higher deprivation.

A statement from ANEC said: “Fairness is a key issue. Whilst the Government has consistently made the point that “North East councils receive more money than other councils and therefore have to take their fair share of the cuts, ANEC has provided analysis between councils in the North East with those in the South (for example, Durham compared to Surrey) which show that the needs of the communities that councils serve in the North East differ dramatically from other areas.

“We make the point that we have more older people requiring essential council services, who are not able to privately fund their care; the council tax base is lower with significantly more Band A properties which generate significantly less income and demand pressures increasing in children’s services.

“Based on ANEC’s analysis, Surrey will receive £173 more protection against grant loss than Durham and will receive high specific grants. The difference in spending power in 2013/14 between the two areas, despite the differences in need, amounts to only £112.”

ANEC also point to the Government’s New Homes Bonus scheme, suggesting that North East councils will pay in more than they receive.

They say removing vital money from core revenue funding will impact much needed services such as social care, roads and support to business.

In December 2012, Communities Secretary Eric Pickles announced the “biggest shake-up of local finance in a generation” which he said represented “a bargain” for local authorities.

ANEC estimate that over £1bn of funding will be re-distributed to the South East from the North East, North West and Yorkshire and Humber as a result of the decisions.

Cllr Paul Watson, Chair of ANEC said: “We hope Ministers will give careful consideration to the issues and concerns ANEC has highlighted in its response to ensure that we get a fair settlement, which is what Government has stated it is committed to do – fair to north and south, rural and urban, shire and Metropolitan England.

“In highlighting the distributional impacts and consequences of policies such as New Homes Bonus and damping protection, as well as other critical issues for North East authorities, we are urging the Government to take full account of the impacts across all parts of the country. The examples we have provided that show wide disparities between councils in the North East and those in the South speak for themselves.”

This was posted in Bdaily's Members' News section by Tom Keighley .