Budget Statement — House of Lords, 2017-12-04
Topic: Macroeconomics
Jeremy Hugh Beecham (Labour, Centre-left): My Lords, I begin, as is customary, by referring to my interests as a Newcastle city councillor and vice-president of the Local Government Association, and on this occasion as a beneficiary of the Government’s largesse in relation to capital gains tax, inheritance tax and the treatment of higher-rate taxpayers It is just a few days more than seven years ago that the then Chancellor proclaimed: "Britain is on course both to grow the economy and balance the books".—[Official Report, Commons, 29/11/10; col. 530.] The reality is that the economy is growing at a slower rate than that of our partners and competitors and we have missed the target for balancing the books—something that will not be achieved, it now appears, until the mid-2020s. Instead, we are experiencing the worst record on household incomes and productivity in living memory, with devastating effects on the lives of millions of people, in relation to their ability not only to provide adequately for their families but to have access to key public services and affordable housing and to make provision for their years of retirement Across a wide range of critical services from health and social care to education, policing, the shocking state of our prisons and the appallingly diminished access to justice, the fifth-richest economy in the world is failing to meet the needs of its people, wedded as this Government are to the failed dogma of privatisation and the minimisation of the role of the state—national and local—in furthering economic growth and social justice. Consider the news in the last few days, to which some of your Lordships have referred. On Friday we had a report of a growing crisis in the provision of care homes, where the Competition and Markets Authority seeks urgent action because the current regime is not sustainable, as councils are unable to pay to the providers of the service the extra cost of between £900 million and £1 billion—and rising—needed to ensure equity between self-funded and public-funded care. Or take yesterday’s news, which has again been referred to, of the resignation of the four remaining members of the Social Mobility Commission, including not only Alan Milburn but the highly respected Member of this House, the noble Baroness, Lady Shephard—without any real response from the Government to that event In the 50 years I have been privileged to serve as a local councillor, I have never known such unrelenting and damaging pressure on crucial local services—pressure which this Budget, like its predecessors in the last seven years, has failed adequately to address. Even now, when the Chancellor talks of building 300,000 homes a year he is looking seven or eight years into the future, as my noble friend Lady Blackstone pointed out. It is far from clear how many homes councils will be allowed to provide let alone, as I have mentioned several times in debates, what improvements in space and energy conservation standards will be applied—areas on which we lag behind most of Europe The Budget did, it is true, make some movement towards addressing the issue but only to the extent of inviting councils to bid for increases in the cap on housing revenue account borrowing by up to a total of £1 billion from 2019 to the end of 2022. At a conservative estimate of a cost of £100,000 per home, that would provide over four years a grand total of some 10,000 new homes. What on earth is the problem with allowing housing revenue accounts to borrow? That borrowing would be not for revenue expenditure but to provide assets with a value, diminished in that sense only by the Government’s fixation with requiring the right to buy at a discount. Laughably, the Government are apparently now proceeding with a regional pilot of right to buy for housing association tenants at a cost of £200 million Councils are facing a funding gap of £5.8 billion by 2019-20 and there is a current shortfall of £1.3 billion in adult social care. Astonishingly, no mention was made in the Budget of increased funding in this crucial area, as the right reverend Prelate the Bishop of Portsmouth pointed out. This is an area in which the previous spring Budget provided £2 billion over three years, as a one-off sum. There are real issues, moreover, in relation to the funding going to an overstretched NHS for capital funding for the so-called sustainability and transformation partnerships, where it is far from clear whether local councils are treated as genuine partners, no doubt as a result of the systemic problems facing the NHS Shockingly, the Budget makes no extra provision for children’s services, which in 2015-16 spent £605 million more than was budgeted in the face of growing needs to protect children at immediate risk of harm, with 90 children a day entering care last year. The shameful reliance on charities and food banks to provide for children in school holidays remains in place Another visible and shameful result of government policy has been the rise in homelessness and rough sleeping. The formation of a task force to investigate the problem is welcome but the £48 million allocated seems unlikely to make the impact required. Will councils, which have the responsibility to deal with housing and homelessness problems, be given the lead role in accessing funding to provide suitable accommodation—either directly or via private landlords—rather than the dreadful places to which so many of these vulnerable people are all too often directed? Lastly in relation to housing, while the LGA welcomes the announced change in housing benefit awards under housing benefit and universal credit, will the Government deal with the gap between discretionary housing payment funding of £185 million and the annual loss of £486 million associated with the benefit cap, £557 million from the bedroom tax and £3.7 billion by those paying rent above the local housing allowance I end by quoting one of my favourite poems, Shelley’s "Ozymandias", in which the poet imagines the text on the remains of a statue of a long-dead king of Egypt. It read: "My name is Ozymandias, King of Kings; Look on my Works, ye Mighty, and despair!" The poet added: "Nothing beside remains. Round the decay Of that colossal Wreck, boundless and bare, The lone and level sands stretch far away" A better epitaph for this Government’s seven and a half years in office could not be devised.