Local authority funding cuts will hurt vulnerable and hamper growth, council chiefs warn (From The Northern Echo)
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Local authority funding cuts will hurt vulnerable and hamper growth, council chiefs warn
AS David Cameron promises to create a “land of opportunity”, North-East councils have warned that proposed £350m budget cuts will hamper economic growth and hurt the vulnerable.
The Association of North East Councils (Anec) claims that proposed cuts to their core funding will mean a 25 per cent real term reduction over the next two years.
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In a letter to Communities Secretary Eric Pickles, Anec chairman Councillor Paul Watson warns the cuts will prevent councils from delivering key statutory services.
Coun Watson said it was “difficult to see” how children's services would cope with a further 25 per cent reduction.
Pensioners and adults with health and social care needs would also suffer, while the scale of the cuts would threaten councils' work to drive economic growth, Coun Watson warned.
In its response to the Department for Communities and Local Government (DCLG) consultation on the local government finance settlement for 2014/15 and 2015/16, Anec said its analysis showed the North-East faced a disproportionately high share of the national £5.5bn cut.
According to Anec calculations, the North-East would lose a further £296 per household, compared to a national average of £233.
A 'heat map” produced by Newcastle Council shows the North of England, including the North-East, bearing the brunt of the proposed core funding cuts.
Coun Watson said the real terms cut of 25 per cent was much higher than the ten per cent announced in the spending review in July.
He said: “In our submission to DCLG, Anec highlights the negative and disproportionate impacts of further funding cuts to the North-East, which would be on top of already much higher reductions in spending power in this area than the national average.
“We feel there is a strong case for an alternative, fairer approach to local government funding which we will be seeking to discuss with ministers and senior civil servants over the coming weeks and months.”
The response was submitted as David Cameron told the Tory party conference in Manchester that his party could build a "land of opportunity".
The Prime Minister asked Britain to give the Conservatives the tools to "finish the job" of "clearing up the mess" left by Labour.
But Darlington MP Jenny Chapman said the coalition government was creating a divided Britain.
“What's happening is we're seeing a return to prosperity and opportunity for some and a Government intent on managing decline for others.
“The local government settlement is just another example of the transfer of money away from the North-East and other areas to the south of the country.”
Middlesbrough MP Andy McDonald added: “Local Councils are the backstop, the last line of defence for our communities, on the one hand trying to face up to a crisis in social care as our population ages and on the other starved of cash to bring business and jobs into the region.”
Anec is urging the Government to allocate cuts on a simple equal percentage based on spending power.
The association has also called on ministers to reduce the scale of the cuts by reducing the amount of funding which Government is intending to hold back or “top slice”.
The decision to fund the new homes bonus by holding back £680m for local government cure funding must be reviewed, Anec said.
The Department for Communities and Local Government said councils accounted for a quarter of all public spending and were forecast to spend £102bn this year - £4bn more than last year.
"As the independent House of Commons Library confirmed funding is distributed fairly to all parts of the country - rural and urban, north and south, metropolitan and shire – ensuring the smallest reductions for the councils most reliant on government support.
"This Government’s carefully considered reforms are helping councils to deliver sensible savings while protecting front-line services and achieve greater financial independence through new incentives that reward councils that support local economies.
"However, there is more councils can do to recover the £2bn a year of uncollected council tax, reduce the £2bn lost to fraud and error and use £19bn of reserves they hold to reduce waste and protect front-line services."
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