PARLIAMENT HEARS CALLS FOR BETTER DEAL FOR WEST BERKSHIRE

12.00.00am GMT Tue 10th Feb 2004

Liberal Democrat MPs united in a push for a fair funding deal for West Berkshire last week, during a parliamentary debate on the local government settlement.

David Rendel MP was joined by the Liberal Democrat local government spokesperson, Ed Davey MP, in highlighting West Berkshire's plight.

Commenting on the debate, Mr Rendel said:

"The Government's own assessment of local need shows that West Berkshire should have received an extra £6.6 million over the last two years. But Ministers are refusing to give us the money because of their policy of imposing 'ceilings' on the increases that councils can receive.

"The very fact that the Government's formula is saying that we need so much extra cash shows that West Berkshire has been seriously underfunded for many years. But Ministers are not offering a single penny towards this large spending backlog.

"As a result the Council has no choice but to increase Council Tax. The increase would be dramatically reduced if only central Government gave us a fair deal."

ENDS.

Notes to Editors

The exchange in Parliament was as follows:

House of Commons : 5 Feb 2004 : Hansard Column 992

Ed Davey: Then there is West Berkshire, another well-performing authority. Caught in the pincer of passporting and capping, it is obeying the DES, and as a result looking at a double-figure council tax rise—simply because it obeyed central Government. For West Berkshire, the situation is even more galling. The ODPM says that it deserves more money, but it lost more than £3 million of what the ODPM said it needed last year, due to the ceilings. This year, the ceiling will cost it the £3.6 million that the ODPM says it is now due. With that cash, its council tax would indeed be in low single figures.

David Rendel: Does my hon. Friend realise that in a way, the situation is even worse than he suggests? The very fact that the Government have imposed a ceiling on West Berkshire indicates that it was underfunded for many years under the previous formula. So there is now a big backlog of necessary expenditure, towards which not a penny is being offered.

Ed Davey: My hon. Friend is exactly right. Such councils are having huge problems. The effects of passporting, capping and ring-fencing are combining with that backlog and creating real problems. We have arrived at a truly bizarre situation. The Government admit that a given council deserves more cash, but they take it away to fund the settlement's floors. When the council tries to adjust its budget by spreading its remaining cash fairly across its services, it is told that it cannot do so, and that much of the cash should go to schools. Then, when it tries to raise its council tax to do what it has been told, it is capped. No wonder the Audit Commission said that the Government's council tax system is fundamentally flawed.