Tag Archives: Business rates

Councils are ‘fire fighting from budget to budget’ due to cuts and changes

Jo Cox speaking in the debate on local government fundingCouncils are fire fighting from budget to budget due to government cuts and changes to the way they are funded.

This was the message from Batley & Spen MP Jo Cox during a debate in Parliament on local government funding yesterday afternoon.

Mrs Cox, who is a member of the Communities and Local Government select committee, was critical about the lack of firm details and future funding plans as well as constant rumours about new responsibilities being delegated to town halls, but with no new funding.

She told MPs and ministers: “When councils simultaneously face rumours about huge new services, such as the attendance allowance or public health, for which they may be expected to take responsibility over the same timeline, they are left with no security in their financial planning.

“The reality is that many councils have very little room left for long-term financial planning. My council tells me that it is firefighting from budget to budget without long-term certainty, and that it will be 2.5% worse off in 2020 than today, compared with national average cuts of about 0.5%.

“That figure does not seem very big, but it is about the size of the entire libraries budget, and let us not forget that it comes on top of incredibly severe cuts over the past four years that mean that Kirklees Council will be spending about 15% less than it spent in 2010.

“I do not believe that anyone becomes a councillor to cut local library services by 32%, to cut children’s music services by 94%, to remove £700,000 from the budget to cut grass or to completely scrap community events and festivals, which is what is happening in Kirklees.

“Many of my constituents are feeling the even sharper end of council cuts to adult social care and other important services. My fear is that the Government wants to blame local councillors.”

Mrs Cox went on to tell MPs that a family living in a £70,000 terraced house in Batley will now be getting £60 less per family member in council services than they did in 2010, but families living in a £2 million home in Oxfordshire will be getting £50 more per family member.

“That seems blatantly unfair, and my constituents struggle to understand it,” she said. “That disparity in core spending power over the course of this Parliament is staggering and seems to be growing. For councillors such as mine in Kirklees, it does not feel like we are all in this together.”

The comments here are taken from a speech in Westminster Hall made yesterday afternoon. Time limits imposed on the debate meant Mrs Cox’s speech was cut short but you can read the full debate here.

Jo Cox: George Osborne’s perfect storm to batter North

Published today by the Yorkshire Post

In one fell swoop, the Chancellor has created a perfect storm for Northern councils. It is one that many of our local authorities will struggle to withstand.

In spite of George Osborne’s rhetoric, his Autumn Statement missed an opportunity for real and meaningful fiscal devolution to local authorities. Instead, he offered two traps that will impact every corner of the North.

First, the local government grant, which provides the largest component of council funding, will be scrapped. Councils will instead retain all of the business rates that they raise.

Although welcome in principle, without a built-in redistributive element it’s hard to see how this will do anything other than reinforce existing inequalities between North and South.

The current system takes account of local circumstances and ensures a fairer distribution of funds from central government. Remove Whitehall from the equation completely and we’re left facing a Darwinian nightmare where the strongest, richest councils will survive and prosper, while the rest, and more importantly the vulnerable people they care for, are left out in the cold.

In the case of Kirklees, my own council, the funding gap left by these changes is estimated at more than £30m annually. In comparison, Westminster Council’s budget will increase 10-fold.

We urgently need to know how the redistributive safeguards hinted at by the Government will work otherwise Northern councils could be left with a huge funding shortfall.

Secondly, the Chancellor has given councils the power to raise council tax by two per cent for social care. The Government estimates that this will raise £2bn by 2020 – a figure dwarfed by the Local Government Association’s estimate that the funding gap for adult social care will have hit a staggering £7.9bn by then.

In addition, the Institute for Fiscal Studies says there is no way the Government can actually guarantee money raised from this precept be spent on social care, while the Social Market Foundation’s warning is more stark. They say that the social care precept will mean plenty of additional resources for councils in the South, but much less for many councils in the North.

Councils with higher elderly populations and high, complex adult social care needs will suffer disproportionately. Disparities in health, age and need are being disregarded.

For Kirklees, the two per cent precept would raise just £2.8m a year. Overall, the council estimates that the consequences of the Chancellor’s Autumn Statement will be an overall cut of 20 to 30 per cent by 2017. This is on top of the cuts of that they have had to cope with since 2010.

Councils in the most deprived areas with the greatest social care needs will raise less than a third of more affluent areas. Those who rely most on the government funding will be least able to meet the needs they have through council tax rises. If you want to exacerbate the crisis in social care, this is how to do it.

There is also a broader problem that this policy does not confront.

The Conservative MP and GP Sarah Woollaston, chairman of the Health Select Committee, says we cannot have the Government’s seven-day NHS without ensuring social care is properly funded. In fact, she says, the fate of the NHS rests with social care. The link between the two is crucial and the two need to be treated on equal terms. Wrap around care, addressing delays with discharges from hospitals and tackling bed blocking are all dependent on a system of social care that is fit to cope.

Rather than pinning council tax increases on local authorities, the Government need to take positive action to fund and plan for social care for the next several decades.

Both these polices are traps for Northern councils and are part of a package of devolution that ties one hand behind our backs. These are not good deals as currently devised – especially for councils with a low tax base and high needs. Councils will be forced to take further difficult choices about cuts to vital local services, raise council tax or most likely do both.

I hope the intent that we can see in the Chancellor’s latest devolution offer serves as a stark warning to all of those in Yorkshire who are working towards meaningful devolution. And there is the challenge for those of us who care deeply about devolution: we have to find a way to make this work – in spite of George Osborne.

Jo Cox is Labour MP for Batley & Spen and a member of the Communities and Local Government select committee.

Ministers pressed on business rates plan

011215 Treasury Questions

Jo Cox raises concerns with Treasury ministers

Concerns about how much income Kirklees Council will lose due to government changes to the way local government is funded were raised with ministers this week.

Kirklees estimates it will lose £32million a year when the government allows councils to keep the business rates they collect. But the grant from Whitehall will cease and this, in Kirklees’s case, is topped up by redistributing money from more affluent local authorities.

Jo Cox MP raised the question with Treasury ministers in the House of Commons yesterday. You can watch the exchange by clicking here.

July column: Our town centres

Jo Cox writes a column every month for the Batley News and Spenborough Guardian. This is the column for July, published in both newspapers this week.

One of my most prized childhood memories was the weekly Saturday morning shopping trip with Grandad Arthur in Heckmondwike. The outing always included two eccles cakes and an iced finger, a paper and endless chats with what at the time seemed like the entire population of our busy little town.

Speed forward a few decades and shopping habits and technology mean our town centres aren’t quite as busy or as thriving as they used to be.

Traders, small businesses and shoppers all across the constituency regularly talk to me about this – some believing that there’s no point romanticising the past, times have changed and the future is online or ‘super’. Others – quite a few other people – think there’s an alternative that we should fight for. Just look at Hebden Bridge, somewhere that has found quite a niche.

Over the past year I’ve had regular meetings in Batley to discuss the town centre and in the last week I met again with traders in Heckmondwike, met with the Birstall traders and attended a meeting of the Spenborough Chamber of Trade in Cleckheaton.

One issue that has repeatedly come up is that there is a major issue with local business rates. The cancelled revaluation of business rates by the last Government means local traders are still paying rates based on rental values from 2008, before the world financial crash. Most have seen their rents drop considerably but their rates remain unsustainably high.

I’ve already raised this issue in Parliament and will keep asking for the Government to bring forward its 2017 review to give our high streets a fighting chance.

Im also working with a team to produce a vision for the future of Batley town centre, Im exploring ways to help traders in Heckmondwike and have offered to support the Chamber plans and events in Cleckheaton and Birstall.

I am always impressed at how much hard work and commitment there is from traders, many of whom devote a staggering amount of hours to helping and improving their towns as well as running their own businesses. This effort needs to be recognised and acknowledged. They are passionate about helping making sure our town centres offer something that little bit extra – ranging from organising beautiful hanging baskets to the spectacular Christmas lights switch on events and vintage days.

There will be further public engagement once we have the vision and a clear way forward but I’d like people to start thinking about our town centres and what they think would help.

We must not be naive but we should be bold, creative and ready to work together.

ANOTHER key general election issue was sports provision in the Spen Valley.

Following the election I met with the leader of the council David Sheard and the chief executive of Kirklees Active Leisure Alasdair Brown to discuss progress with the exciting redevelopment and eight figure investment they have planned for a new sports village at the Spen Baths site.

There has been well documented issues and controversy, particularly surrounding Whitcliffe Mount Sports Centre, many of it avoidable. That is why I held a series of meetings over Whitcliffe Mount and have another one in the pipeline.

I will continue working to ensure we have the best sports provision possible in our constituency and Labour’s plans for Spen are something that I think are really exciting.

Call for government to end north/south divide on business rates

Reunion CafeA Yorkshire MP is demanding the Government step in to address the way businesses in the region have been punished by the decision to postpone the revaluation of business rates.

Jo Cox, Labour MP for Batley & Spen, said that while businesses in London and the south east have benefited from the present business rates regime, those in other regions appear to be losing out.

In 2013 the Coalition government announced, without warning, that it was postponing the revaluation of business rates.

“What this means is that businesses have been paying rates during the most difficult, depressed climate that were set before the financial crash. They will have to continue paying at this level for two more years,” said Mrs Cox

“The government’s gaze is firmly fixed on London and the south east and upon helping larger businesses. I am worried they have no concern for business in Yorkshire, particularly smaller enterprises in the retail sector in our town centres.”

Mrs Cox has tabled a motion in Parliament calling on the Government to take action to address this problem.

“Speaking with traders in towns in Batley & Spen it is clear that business rates are a major issue and a major barrier to both new start ups and growth for existing businesses,” she said.

Business rates are based on valuations made in 2008, prior to the world financial crash and ensuing recessions. By postponing the revaluation the crucial link with rental values has been severed.

Mrs Cox added: “With rents falling, business rates have stayed as they were. A revaluation would have meant business rates fall in many parts of the country.”

Mrs Cox is now calling on the government to address this problem urgently, help small businesses and towns by creating a more conducive environment in which smaller businesses and town centres can grow and thrive.

She also asks the government to use its imminent review of the business rates system to ensure there is a fair mechanism that enables companies to generate jobs, create wealth and growth within communities.