I beg to move, That the Local Government Finance Report (England) 2022–23 (HC 1080), which was laid before this House on 7 February, be approved.

In my constituency, Newham Council is about £10 million shy because of covid spending, which will have ongoing consequences. Much of it has come from revenue accounts for temporary accommodation. Newham has the largest housing list in the country and the second highest rate of child poverty, yet we are still having to cope with covid costs of £10 million and counting without any respite from the Treasury. I am grateful to the right hon. Gentleman for mentioning how very difficult it has been to be a councillor or officer in local government over the past two years. They have had a terrible job, but it is not made easier when they were told that their costs would be covered only to find themselves £10 million shy and counting.

Boroughs such as Newham will benefit from £38 million under the settlement, compared with rural areas such as Dorset, which will receive nothing. Does my right hon. Friend agree that should be borne in mind?

The right hon. Gentleman is being generous in giving way. He will know that Salford City Council has faced budget cuts of £232 million since 2010 and has stated that the approach to funding that he outlines does not adequately reflect the demand that it faces. Does he agree that true levelling up requires funding to meet actual demand, and that it requires differentials for poverty, inequality and council tax payers’ ability to pay to be effectively factored into Government grant methodology?

Why does the Secretary of State think that the Conservative chair of the Local Government Association, James Jamieson, has criticised the settlement for not including sufficient funding to tackle the considerable additional pressures on local services, particularly with respect to vulnerable adults and children?

The Secretary of State just does not get it. Those were not options; they were political choices taken by the coalition Government. The point that my hon. Friend the Member for Salford and Eccles and I are making is that on issues such as looked-after children and adult social care—he should remember that in County Durham life expectancy has gone down in the past 10 years—it is not optional for councils to intervene. They have a statutory obligation to do so and if that is not taken into account in the formula, councils in areas such as County Durham and Salford and Eccles will always be at a disadvantage because the right hon. Gentleman’s Government, of which he is a part, took that out of the funding formula.

I could recognise the valuable approach the coalition Government took under the then Secretary of State in removing ringfences, but we can contrast that with the number of pots that are being created that local authorities have to bid into, which seems like ringfencing by another name. The Secretary of State mentioned Councillor Jamieson, the chair of the LGA, who said at the Select Committee that we cannot sort out local government finance until we sort out social care funding. The LGA is looking for a big solution and it is disappointed that the levy highlighted as solving the problem actually gives no mainstream money to local councils to deliver important social care services.

The Secretary of State's debate on local government funding and levelling up is misleading. He acknowledges past mistakes in handling the financial crisis but fails to address current issues, such as rising inflation and increased costs for families. The council tax rebate does not compensate for the years of cuts imposed by the Conservative Government. Councils are being asked to raise taxes or reduce services due to a real-terms cut in central funding. People are struggling with higher bills and food prices while facing 3% increases in council tax. Since 2019, local councils have seen their proportion of funding from central Government nearly halve over seven years. North-east Lincolnshire, Dudley, Hyndburn, and Blackpool have all lost out under the proposed deal. Councils are still dealing with pandemic-related issues and a significant public health grant cut, along with a half billion pound shortfall for children with special educational needs. The Secretary of State's levelling-up plan fails to address these critical funding issues in towns facing social care pressures and rising costs due to inflation.

Expressed disappointment over the lack of revenue support grant for Dorset, highlighting high council tax rates and low population under age 65 compared to other regions. Emphasised the need for a meeting with the Secretary of State to address local issues such as social care costs and transport funding disparities.

The Secretary of State's definition of inflation is different from the Bank of England’s, leading to a smaller real-terms increase in core spending power. Local government has faced significant cuts since 2010 compared to other parts of the public sector. The poorest areas have had the largest budget reductions over the past decade. For Sheffield, £3 billion-worth of grant has been lost since 2010 in real terms, impacting levelling up efforts. Real spending power per head has fallen since 2015 despite an increase in total spending power. Council tax now makes up a larger proportion of council funding compared to service spending on social care, leading to cuts in other essential services such as libraries and parks. Despite these challenges, councils have managed remarkably well, particularly during the pandemic by providing essential services like food parcels and test and trace operations more efficiently than national bodies. Challenges for the future include multi-year settlements, fair funding review incorporating levelling up, new funding sources for social care, integration of health and social care while maintaining local collaboration, business rates reform to protect high streets, and a council tax review to address regressive tax issues. A 2.8% increase in public health grant is insufficient when considering inflation and the need to reduce health inequalities exposed by covid.

It is a pleasure to take part in this debate and credit is given to our leader, Councillor Spencer Flower, and chief executive Matt Prosser. The hon. Member for Wigan agreed that we should thank all staff and officers who did a fantastic job over the pandemic. Dorset has one of the highest council taxes and a low business retention rate, which affects funding. Dorset received £10.4 million from the budget settlement, although some is ring-fenced. The revenue support grant for Dorset is zero. There needs to be more stable long-term funding with three, four or five-year funding periods. Dorset has an accumulated debt of £70 million on high-needs block for children with special educational needs and requires additional funding from the Department for Education. Next year's budget proposals include a 3% increase in council tax and an almost 1% increase for social care precept, with further details provided.

Before discussing the local government finance settlement, he mentioned that the Under-Secretary of State for Levelling Up, Housing and Communities did not answer questions during a debate. The current settlement is still 20% lower than in 2012-13 and it is important to plan ahead with more than a one-year settlement. He supports proper accounting for local levels of need but worries about penalising those who cannot increase council tax by the required amount. Concerns exist over insufficient funding covering inflationary pressures, including democratic pressures, legislative cost pressures, and energy price rises. Knowsley faces a £12 million deficit due to new burdens like adult social care. Since 2010, Knowsley has lost £116 million in grant support which severely impacts services and life chances. Despite this, the council managed some transformational changes including Kirby town centre regeneration.

Mr Neill discussed the history and challenges of local government finance settlement, emphasising the need for fiscal and financial devolution to achieve levelling up. He praised Bromley Council's efficient management but highlighted significant cost pressures due to an ageing population and proximity to inner London. He also pointed out issues with funding discrepancies between social services and NHS, as well as concerns about public health grants and dedicated schools grant shortfalls. Mr Neill advocated for a system that rewards efficiency and suggested reviewing area cost adjustments and giving local authorities more financial freedom.

Pays tribute to local government workers and elected members; highlights the importance of parish and town councils stepping into gaps due to budget constraints. Criticises one-year budgets as disrespectful and unhelpful for planning ahead. Expresses regret over lack of public health funding, especially in Cumbria where mental healthcare spending is extremely low at 75p per child annually. Mentions the inefficiency of running services in rural areas with small populations and calls for an understanding of rural needs. Raises concern about pothole issues due to a high number of visitors compared to permanent residents, suggesting compensation for such communities. Discusses unfairness of council tax as it disproportionately affects low-income individuals and does not contribute to social care improvements despite the increase in taxation. Highlights the housing crisis in rural Britain, affecting social care provision, with 80% of house sales going to second-home buyers during the pandemic. Calls for changes in planning law to prevent family homes from being converted into holiday lets without permission, suggesting a local council tax doubling on second homes as a disincentive.

Emphasised the need for a fair funding review to focus on poverty and need, praised fiscal devolution for local government, highlighted the scandalous treatment of Transport for London by the Secretary of State for Transport demanding council tax increases. Criticised the decline in support from central Government towards local councils due to cuts in funding over the past decade, which has made it harder for councils to strengthen community-run services and increased pressures on them to sell assets or slow investment in crucial local services. Cited a 50% fall in spending power of local councils funded by central government since 2010 according to the National Audit Office. Highlighted Harrow Council's challenges, including a 97% reduction in revenue support grant funding over ten years and the need for significant savings and efficiencies as well as council tax rises to balance budgets. Stressed the positive efforts of dedicated councillors despite financial constraints.

The hon. Member emphasised that the Government are attempting to distance themselves from decisions made before their time in office, attributing blame for local government funding issues to previous administrations instead of acknowledging their own policy choices. He provided specific examples from County Durham, detailing a 56.3% cut in local government funding over the past decade and highlighting how central government funding cuts have shifted the financial burden onto local council tax payers. Kevan Jones also criticised the levelling-up initiative for being superficial and focusing more on visible capital projects rather than addressing the structural issues of local revenue funding.

The hon. Member, in her interventions, emphasised the importance of parliamentary decorum and questioned whether Kevan Jones had given notice to a fellow Member before criticising them on the Floor of the House.

The hon. Member acknowledged the excellent work being done by councils across the country and suggested that the hon. Member for West Dorset should prioritise broadband improvements in Ilfracombe to send positive messages to the Prime Minister.

The hon. Member, though not extensively quoted in this snippet, was acknowledged by Mike Amesbury for his contributions on regional and rural issues.

Acknowledges contributions from other Members, addressing specific points raised by Chris Loder regarding spending power increases, Clive Betts about the relevance of upward pressure on social care due to an ageing society, Richard Drax concerning keeping taxes down, George Howarth on multi-year settlements and funding issues in Merseyside, Robert Neill regarding public health grants and obesity initiatives, Gareth Thomas advocating for more devolution to places, and North Durham MP on the levelling-up White Paper. Emphasises that the spending settlement will provide an extra 8.5% for Knowsley.

Expresses appreciation for Neil O'Brien's response but notes that meetings with Ministers have been requested and asks for expedited action on these requests.

Requests a meeting with Ministers to discuss the place-based approach to health care integration involving local government, CCGs, and city councils.

Announced that the Local Government Finance Report (England) 2022–23 and Referendums relating to Council Tax Increases (Principles) (England) Report 2022–23 have been approved.