Monthly Archives: November 2016

Getting the basics right, protecting the most vulnerable, and growing an economy that benefits all.

 

WM portrait

Our draft Budget for 2017/18 is now out. My Labour & Co-operative Administration is facing up to the harshest ever financial circumstances the city council has faced. We are making a stand, drawing a line in face of the biggest ever cuts imposed by the Conservative Government.

We are protecting:

  • Early years services including nurseries and childrens centres, child protection is our legal duty and top priority
  • Libraries, not just as a place to borrow books but as community advice hubs and assets, the heart of our neighbourhoods approach
  • Refuse, recycling and street cleaning, the basic service your council tax pays for, with £400k coming in from commercial waste collection. Investment in big belly bins, new street cleaning vehicles, garden waste are new service innovations.
  • Public toilets no more cuts proposed, none added in the current year, no additions to the closures chosen by the previous Green Administration
  • Domestic violence we are pushing back against to cuts to this vital preventative service
  • Rough sleeping we are succeeding working to prevent hundreds of families entering homelessness, and are resisting pressure from benefit cuts that put more at risk
  • Poverty proofing the school day was a key recommendation from the Fairness Commission, giving pupils a fair start at school
  • Living Wage protected at local level not the national rebranded minimum wage
  • Social care: we are reviewing and redesigning services to focus on effective signposting, build stronger communities through increased partnership working, provide preventative services and ensure people get the safe, high quality, personalised, accessible and sustainable support they need.

This is our plan, our positive way forward, building a co-operative council and city to keep vital services going:

  • Investing millions in digital customer services
  • Saving millions through managing assets better, like our move from Kings House which will save £2m a year
  • Designing neighbourhood services and partnering with other organisations to keep services going locally through local hubs, volunteer-run parks
  • Saving half a million through our new housing allocations policy
  • A £7m investment in better street lighting that will deliver a £500k saving each year
  • Placing the Royal Pavilion into a trust to protect it and enable it to raise more money
  • Joining the Orbis partnership with neighbouring councils sharing support services to protect jobs and grow capacity
  • Housing investment in new council houses and truly affordable homes to tackle poverty and homelessness, and bring in new council tax
  • Major projects – new infrastructure, economic activity, more business rates/rents
  • Revenue generation from services like commercial waste, vehicle workshops

All this in the face of enormous pressures:

  • Government grant is down by another £11 million this year. It is shrinking from £140m to £6m over an 8 year period, a 40% funding reduction in real terms
  • We have already saved £70 million in last 4 years, £20 million in current year, leaving no easy cuts, no simple solutions, no savings that are pain-free
  • We still have to make £51 million savings over next three years, £24 million in the coming year
  • We are still £3m off balancing the Budget for 2017/18 – more savings need to be found
  • The £125m income from council tax is now smaller that £150m costs of care, increasing by £7m in the coming year
  • We are putting £1.5m more into supporting council tax payments for people on low incomes as Government funding for that scheme is cut
  • We are putting £300k more into free bus passes for older people, from the £562k additional parking revenue – the total cost of free bus travel is now more than £11m
  • We are making a further £2m of management savings

Cuts include:

  • £750k from youth services, however £250k remains for advocacy, services and support for young people vulnerable to exploitation, involved in substance misuse, entering the criminal justice system or requiring emotional and mental health support. We also continue to fund Not in Education, Employment or Training (NEET) work, the Youth Employability Service, the Youth Offending Service, and services for adolescents.
  • £600k from parks covered in our Big Conversation, and £100k from sports club subsidies
  • £290k from supported bus routes – still leaving a £900k subsidy

We are not alone. This is all in a national context:

An additional 2% social care “precept” on council tax, above what was allowed in the last financial year, has been asked for by most councils responsible for for social care, but this was not announced in the Government’s Autumn Statement. Even if it is, it won’t be Government that pays it will be us, with them transferring the financial burden of social care on to local taxation.

LGA Chair Lord Porter (Conservative) warns that councils will face an ‘extremely challenging’ situation over the next few years to tackle the £5.8bn funding gap by 2020: ‘Many councils are faced with difficult decisions about which services are scaled back or stopped altogether.’ He said the government must take urgent action to fund social care properly, if councils are to stand any chance of protecting care services for elderly and vulnerable people. Porter said that extra council tax-raising powers would not bring in enough money to alleviate the pressure on social care services for elderly and vulnerable, and that people are at breaking point now.

So far 24 top tier councils both Labour and Conservative-led are taking up full increase in council tax allowed at just under 4%. The days of council tax “freezes” are over.

Other councils have it even worse. In Liverpool all council-run services, including libraries, sports centres, maintenance of parks, highway repairs, street cleaning and rubbish collections, would have to be cut by 50% to balance the books, with Liverpool Mayor Joe Anderson warning there will soon be no funds left, even for basic services.

There is a nationwide crisis in social care:  77 of the 152 local authorities responsible for providing care for the elderly have seen at least one residential and nursing care provider close in the last six months, because cuts to council budgets meant there were insufficient funds to run adequate services. In 48 councils, at least one company that provides care for the elderly in their own homes has ceased trading.

Is the Government getting it’s priorities right? No.

  • The Autumn Statement gave £240m for Grammar Schools whilst failing to help councils with social care and basic service funding.
  • Over the course of the Conservative’s decade in power they will give away £21 billion in tax cuts for higher earners, and another £1 billion in inheritance tax.
  • In the same period they are handing over £12 billion in corporation tax cuts for big businesses.
  • All this while £7.6 billion is cut from local government. That’s councils like ours.

Find out more about our Budget and watch my Budget message here.

Sign my petition calling on the Government to reverse their tax cuts and restore council funding: https://www.change.org/p/theresa-may-mp-save-our-services

 

Facing hard budget cuts together

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There is no sugaring the pill, no sweetening the message, no avoiding the truth. Your council Budget in the spring will contain cuts to services and jobs unlike any seen so far. We are likely to have to make savings of tens of millions in the coming years, on top of the £100 million savings that have been delivered over the past five years. At the same time it is likely that your council tax will increase by  at least 4%. And the cuts will continue until 2020.

I know there will be campaigns and protests over many of the cuts we are being forced to make, strong cases put forward as to why services should be spared the axe, why they bring value above and beyond their cost. Those campaigns will be right, their anger justified and understandable. There are no services the council provides that do not bring benefit to you, your community or our city. Any cut we make will have an impact.

So why are these cuts happening? Three reasons. Firstly the Government is removing the third of our service funding it has until now provided. £27m is being cut from the money the Treasury gives Brighton and Hove each year by 2020.

Secondly, more and more people need the social care services the council has to provide. Care for the growing number of older people, people with disabilities or long term health conditions, and vulnerable children in care. It is the biggest part of our budget and we have to find £10 million more next year, and by 2020 care costs could eat our entire budget.

Last year the Government added 2% to permitted council tax increases to help fund this, but the £2 million that brings in isn’t enough to keep pace. Most Conservative-led councils agree. The government may yet add a further 2% for next year, although there was no indication of it in the Autumn Statement.

Thirdly, we are in the middle of a housing crisis with rising demand for temporary accommodation as many people struggle with rents due to benefit reductions. We are building new council homes and new affordable homes as fast as we can. Our joint venture with Hyde Housing due for approval in December could deliver over a thousand at just 60% of market rates.

Why aren’t we making other savings, finding new income or investing to save? We are. My team of Labour councillors is working tirelessly with support from officers to find new ways of meeting the financial challenges. we are joining an innovative scheme with East Sussex and Surrey to share “back office” support services like human resources, finance and legal.

We are investing money from selling buildings like Kings House in better online services, and in the process saving £2 million a year in running costs.  We are innovating, changing, bringing co-operative ideas to how we work with you to keep services going. There will be many ways you can pitch in and play your part.

In an uncertain global economy we will fight for investment in good jobs and affordable homes in Brighton and Hove. Any new development brings in additional business rates and council tax to fund your services. We are earning money from new enforcement fines, clothing recycling and vehicle workshop services to help fund front line refuse and street cleaning services.

Over the past eighteen months we have been dashing to catch up with other councils who have been changing the way they fund and provide services for years. Transforming and innovating in what we do needs time and investment.

Why isn’t parking revenue used to offset the cuts? Most of the money we get from tickets, permits and charges goes to fund free bus travel for older people. Why not charge students council tax or just borrow more? The simple answer is that we can’t by law.

Will being able to keep all our business rates help? That won’t happen until 2020, by which time revaluations, appeals and discounts by Government may reduce what we get from local businesses significantly.

Why aren’t we fighting the cuts? The Green Administration waved placards and beat drums outside an empty Treasury, and handed petitions to No 10 that were simply ignored. That’s gesture politics,  we are making the case to ministers, both directly and with our council colleagues across the country and across the political divide, for fairer funding, for the tools we need to do the job you expect us to do. Just as you have had to find new ways of making ends meet, so should we. Ultimately, by law we have to balance the books.

Despite the flood tide of cuts, we won’t just stand there King Canute-like as the water rises over us, we will lead the way to firmer ground. We won’t fall for offers of cheaper delivery from big private companies that could tie you into second rate services. We will work hard to get the basics right, to protect the vulnerable and to grow an economy that benefits everyone. We need your help and support. Let’s fight for your city and your services together.

Financial challenges, Labour values


Like Labour councils across the country, we are facing the complete cut of our support grant from the Conservative Government by 2020. Like Labour leaders, Labour mayors and Labour MPs, I have joined calls for them to end the cuts and stop the rapid erosion of the essential public services councils provide. I’ve taken those calls to the heart of Government, to Cabinet ministers and local MPs. Every week, in newspaper columns and in radio interviews, I remind the residents of our city of how deep and damaging these Tory cuts are.

Recently I and other Labour leaders met the Shadow Local Government Secretary Teresa Pearce MP, who was very supportive and pledged to lead the fight in the Commons for a fairer deal for our councils and local services. We have an excellent shadow CLG team in the Commons, including former council leader Jim McMahon MP.
We will tackle the 2017 Budget based on three Labour principles: getting basic public services right, protecting services for the most vulnerable, and ensuring everyone shares the benefits of a growing local economy.

So what is the scale of the challenge we face here in the city?

The council spends around £760 million a year on hundreds of different services from street cleaning to schools, libraries to homelessness, and street lighting to licensing bars and restaurants. The biggest part of our budget is social care, at around £163 million. In this budget we will have to address a predicted budget gap of £18m through savings, following a similar level of savings already being implemented this year.

This is because the government is cutting entirely what is called the revenue support grant to councils by 2020 and we have to meet growing costs and demands, across adult and children’s social services. The reduction in grant funding alone is around £27m by 2020. Our overall funding has reduced by around £45m over the last five years which, added to increasing costs and demands, has resulted in the very large annual savings we have and will continue to have to make.

As the government grant support is cut, there will be less money available for services the council could provide but isn’t required to provide. The bulk of the income we receive from parking charges, around £12.7m, goes toward funding the free bus passes for older people that the government does not fund. Similarly, we also have to put another £1.5m into support for people who can’t afford to pay all of their council tax, as Government is cutting the funding needed to do that.

The government is now also looking at councils taking financial responsibility for some NHS services, in crisis locally. Looking after older people, children in care and people with disabilities is already the largest part of our budget. Early estimates show that next year it will cost us at least £10m more. The government will again, through councils, allow two per cent to be added to your council tax bill to pay for this, but that will only raise £2.4m, not enough to keep up. Some councils are asking for another 2% on top of the 4% already allowed, but that would hit many on lower incomes very hard.

Your council tax used to make up around a third of what we spend on general fund services, with another third made up from fees and charges and the remaining third from business rates and government grants. There are also uncertainties regarding business rates; the government currently retains half of our local business rates, around £54m, and will be revaluing business rates next year. We don’t know how much we will receive from business rates by 2020, so we need to ensure more businesses come to the city. Businesses that create real jobs, not zero-hour contracts, and who pay a proper Living Wage, businesses that pay their taxes and are socially responsible.

As more students come to the city, fewer households pay council tax. While being a university city is part of our identity, there’s no ignoring the financial impact of providing services to non-council tax paying households. Landlords who let properties to students are also protected from business rates by the government; we have called for the right to charge landlords business rates so we recoup some of the money we need for public services.

Earlier this year we ran our City Innovation Challenge to find out if individuals, schools and businesses, had ideas to help out as our budgets shrink. Many said we should look to volunteering, and we have recently agreed a new volunteering policy. Meanwhile we are changing how we deliver services, with much more online, and more focus on joined up services in your neighbourhoods, designed by you around what works in your community.

As a Labour council we are building 500 new council homes, and 1000 homes to part-buy or rent at around 60% of market rates. Decent, truly affordable housing is one of the main ways we can get a grip on growing costs and tackle poverty and inequality locally.

We have no choice but to face the financial situation as it is, whilst fighting for a better deal from the Tory government. The Labour leadership made it clear last year that Labour councils cannot set illegal budgets by spending more than they bring in, and this was enshrined in Party rules by the NEC recently. We won’t be pushed down the wholesale privatisation route the Tories want, but we won’t just wash our hands of responsibility for the situation we find ourselves in – as the Greens did at the last budget council. The cuts we will have to make will be difficult and painful. None of us stood for election to make things worse, but we owe it to those who elected us to fight for the best possible outcomes under the worst of Governments.

We will make every effort to focus the money we have on getting the basics right, delivering the best services possible, and doing the right thing by those who most need help. We are paying all our staff the local Living Wage, and defending as many jobs as we can by bringing in new revenue. Where we can share services, use not-for-profit providers, get help from our communities and work in partnership with the voluntary sector to keep services running, we will.

It is a huge and very difficult task, but we are up for the challenge if you are behind us, supporting us in the face of these Tory-imposed cuts. Labour councils can make a difference, can deliver our values in office, and Labour will win nationally by showing we can run things locally. Let’s fight for our city and our services together. 
You can find information about the council’s current budget here.