Monthly Archives: January 2016

Cuts are putting people in need of care at risk. The Government needs to act.

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It is wrong for politicians to be alarmist, to cause concern in order to score political points. It’s referred to as “shroud-waving”. I’ve criticised others for doing so, and I’ve thought long and hard about publishing this post. I do so not to win votes or do down the other side, but out of genuine fear both for for the people who need social care and those charged with providing it.

I posted recently about the competing campaigns against various cuts we are being forced to make to services because of the reduction and eventual removal of the Government’s Revenue Support Grant which until now has provided around a third of our funding. As that funding reduces and ultimately disappears, the cost of providing social care services is rising rapidly.

Those cost increases are down to a huge range of factors. An ageing population, increasing poverty, welfare reform, growing pressures on the NHS, growing numbers of children being identified as a risk, and more. It is right that care workers are paid the Living Wage, but the requirement on providers to pay it brings a cost.

In around four years, without a combination of additional resources and new ways of working, the costs of social care will consume the entire council budget, save for some basic environmental services like refuse collection. In the coming year almost £20 million of risk has been identified across our social care services in Brighton and Hove.

High profile failures like Victoria Climbie, Baby P or Rotherham cannot be allowed to happen again if we can possibly prevent it.

Whether it is services for frail older people, vulnerable adults with learning disabilities, or children at risk of abuse, it is your local council that is responsible for looking after them. If those council care services fail, it is the service directors who are held legally responsible. Councillors are legally and morally responsible as corporate parents for children in care.

Without a proper funding regime involving the collaboration of all agencies, any further cuts to social care budgets by the Government could, in the near future, lead to formal notification by those directors that they cannot guarantee a safe level of care.

The 2% council tax increase, ring-fenced for social care, will bring in an extra £2.2 million each year. It sounds a lot but it isn’t sufficient to meet the increased costs and demand.

Urgent action on the part of Government is needed, before people are put at risk.

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We need to build affordable homes now

housingThis week I went to London to lobby government ministers for more powers to tackle the housing crisis in the city and our region. We need the power to bring forward new sites, draw in new funding, and co-ordinate work to build more affordable homes for rent or to buy.

The statistics on housing in the city are staggering. This week a report said that rents in Brighton and Hove are rising by 18 per cent a year. The average rent for a one-bedroomed flat is around £900 a month. The average price of a flat is £260,000. For a semi-detached home that rises to £360,000, and for a terraced house the average is now £425,000, some £40,000 less than London.

Four thousand people move here from the capital each year, while the student rental market eats more properties each month. With the lack of supply these factors mean house price inflation of more than 12 per cent a year.

Current council policy asks for 40 per cent of major new developments to be “affordable”, meaning on offer at 80 per cent of market rents. With rents so high, even that is unaffordable to those we seek to help, and 40 per cent of units are rarely if ever achieved.

That’s why we are looking to build 2,000 homes for rent at 60 per cent of market rent through our proposed joint venture with Hyde. We are building dozens of new council homes in Whitehawk as part of our pledge to build at least 500 council homes by 2019.

Some argue for rent controls; we are committed to a fairer rental market, with transparent fees and rights for tenants so that the few unscrupulous landlords and letting agents who give the sector a bad name can be made to clean up their acts and not undercut the decent majority.

We will look at any and all opportunities to build, and seek to offer homes of all types and tenures in the city to those who need them.

Our economy depends on staff being able to afford to live here. Our council needs the additional income new council tax-generating properties will bring.

The government is pushing the city and our regional neighbours to build. In his Autumn Statement the Chancellor said he wants 200,000 “starter homes” built by 2020, at 80 per cent of market rates and capped at £250,000. This is welcome, though that price will still be well out of reach for many on lower incomes. The government required us to look at every option in drawing up our City Plan which must deliver over 11,000 new homes in the next 15 years.

Of course when developers bring forward plans to build, as they have done recently in the east of the city, the opposition from Conservative councillors and MPs is vociferous. Any plans to build out into the urban fringe, up in high-rise developments or on brownfield sites are opposed.

Unless we are to become a “London-by-the-sea” with properties only within reach of the wealthy, and new build reserved for overseas investors, the Conservative Government must give us the powers to intervene in the market, and Conservative politicians must accept the case for more homes to be built.

Bold solutions, difficult decisions and innovative partnerships are needed if we are to do what is needed to tackle our city’s housing crisis.

Fund our services from collecting unpaid tax

HMRCIt’s that time of year when many people face the task of completing their tax returns. Most people know that their taxes go towards funding the services they use, the services they rely on to keep them safe, or the services they can turn to when things go wrong.

Peter Mandelson infamously said he was “intensely relaxed about people getting filthy rich as long as they pay their taxes” (a comment he has since rowed back from). And some have been getting very rich indeed.

A year ago a Sunday Mirror investigation found that six major companies alone made some £14 billion in the UK – companies like Apple, Google, Facebook, Amazon, Ebay and Starbucks – yet combined they only paid £41 million in tax. This is because they register their businesses in other countries with lower tax regimes, such as Luxembourg. This is legal under UK law.

The Government is losing more than £1 in every £10 it tries to collect from companies to tax evasion and avoidance. The true figure could be over £12 billion a year, or potentially as much as £34 billion according to the HMRC itself.

It was revealed last month that five of the largest banks in the UK – JP Morgan, Bank of America Merrill Lynch, Deutsche Bank, Nomura Holdings and Morgan Stanley – legally paid no corporation tax in 2014, though they made billions in profits.

As Margaret Hodge MP said to the BBC, HM Revenue and Customs needed to be “more aggressive and assertive in confronting corporate tax avoidance. These global companies are making money in the UK. All we are saying is that if you have economic activities in the UK you are making profits and tax is payable on that.”

Figures released within the last fortnight show that the Chancellor’s efforts to recoup unpaid tax have fallen over £600 million short. However the Government claimed some success in increasing tax payments by major banks and corporations this week, with well known names like Barclays and Vodafone paying more. The code is however voluntary.

Just before Christmas a new All Party Parliamentary Group on Responsible Taxation was established to put pressure on the Government to ensure multinationals pay their fair share. It will hold meetings in public and ask ministers, tax experts and business people to attend for questions and debate. The first item on the agenda will be how to respond to G20 recommendations to crack down on corporate tax avoidance.

Meanwhile, local councils are seeing their funding being cut by £11 billion, over 40% of what they spend on local services like refuse collection, roads, libraries, parks, social care, schools and children’s centres. All the time the costs of looking after vulnerable children, older people and those with disabilities is growing fast.

As I wrote last month, the outlook for council funding is very bleak indeed. People are very rightly becoming very angry as both Labour and Conservative-led councils begin to cut what residents see as essential services, with the Government hoping that the blame will fall on councillors, not on ministers.

There are many things that unpaid corporate taxes could fund, but as the Leader of a council facing cuts of well over £20 million each year, I’m going to make one simple call on the Government.

Make multinational companies and banks pay their fare share of taxes on profits they make in this country. Use some of that money to fund local council services and social care.