Category Archives: Blog

We need answers on Surrey ‘sweetheart deal’ reports

GUardian Surrey 'sweetheart deal'

I’ve joined with other council leaders from across the country to demand answers from the Prime Minister about a deal the Government is alleged to have hatched to give Surrey County Council special help to address the social care funding crisis.

We are asking whether it is the case that Surrey council leader David Hodge agreed to call off a referendum proposing a 15 per cent council tax rise in return for a secret agreement by the Department for Communities and Local Government to plug a huge gap in the council’s budget caused by social care costs and spending cuts.

Surrey is by no means alone in facing an acute and growing social care crisis.

Here in Birmingham, we spent £346 million on adult social care seven years ago. Taking inflation into account, we’d need to spend £420 million now to be delivering services at the same level.

In fact, because of the Government’s austerity regime, we will be able to spend about £230 million in 2017-18.

Our spending on caring for older people has been decimated. Cut by almost half since 2010.

The independent King’s Fund charity believes that in two years there will be a £2.8 billion gap across the country between demand for social care and local authority resources to pay for social care.

By that time public spending on social care will fall to less than one per cent of GDP.

So, if the Government is prepared to help Surrey it must give the same help to all other councils.

Here is the text of the letter to Theresa May:

The Prime Minister

10 Downing Street

London SW1A 2AA

Prime Minister,

We are writing regarding funding arrangements for Conservative-run Surrey County Council. Specifically, the alleged reason behind David Hodge’s decision to drop a planned referendum on increasing council tax by 15 per cent to cover the severe shortfalls in social care, after apparently holding ‘several conversations’ with Whitehall figures.

It has been widely reported in leaked texts, sent by David Hodge supposedly intended for Nick King, Sajid Javid’s special advisor, that DCLG was working on a ‘Memorandum of Understanding.’

In response, as Leaders of Labour councils and council groups, we have a series of questions:

  • Was a deal struck for Surrey County Council?
  • If so, what are the details of the deal?
  • Why was a special deal struck with Surrey behind closed doors?
    Does the Government finally recognise that local Government is grossly underfunded and is that why they have given a special deal to Surrey?
  • Does the Government now recognise that there will be a £2.6bn shortfall in social care funding by 2020?
  • If a deal was struck, will Ministers offer the same deal given to Surrey to all councils, regardless of political affiliation, when the Local Government finance settlement is published on 22nd February?

We have a crisis in social care, resulting from the Conservative Government’s cuts to local authority funding. Secret backroom deals are not the answer. We urgently need a proper solution, which means providing councils with the funding they needed to solve this crisis.

Given the public interest in this matter we will be publishing this letter.

Yours sincerely,

Barrie Grunwald     St Helen’s Council

Mohammed Butt    Brent Council

Richard Watts          Islington Council

Stewart Young         Cumbria County Council

Simon Henig            Durham County Council

Nick Forbes              Newcastle City Council

Lewis Herbert          Cambridge City Council

Peter Martland        Milton Keynes Council

Warren Morgan      Brighton & Hove City Council

Jaz Athwal                 Redbridge Council

Sharon Taylor          Stevenage Council

Simon Greaves        Bassetlaw Council

Peter John                Southwark Council

Sam Dixon                Cheshire West and Chester Council

Steven Brady           Hull City Council

Iain Malcolm            South Tyneside Council

Ray Oxby                   North East Lincolnshire Council

David Budd              Middlesborough Council

Jean Stretton           Oldham Council

Simon Letts              Southampton Council

Sue Jeffrey                Redcar and Cleveland Council

Doug Taylor             Enfield Council

Susan Hinchcliffe    Bradford Council

Mark Townsend      Burnley District Council

Hazel Simmons       Luton Council

Alan Rhodes             Nottinghamshire County Council

Claire Kober             Harringey Council

Peter Box                  Wakefield Council

Christopher Akers-Belcher          Hartlepool Council

Richard Leese          Manchester City Council

Judith Blake              Leeds City Council

Bob Price                  Oxford Council

Tom Beattie             Corby Council

Sachan Shah            Harrow Council

Bob Cook                  Stockton Council

John Clancy              Birmingham City Council

Julian Bell                  Ealing Council

Julie Dore                  Sheffield City Council

Steve Bullock           Lewisham Council

Shaun Davies           Telford & Wrekin Council

Terry O’Neill             Warrington Council

Stephen Lydon        Stroud Council

Phil Davies                Wirral Council

Alexander Ganotis Stockport Council

Steve Eling                Sandwell Council

Sarah Hayward       Camden Council

Peter Lamb              Crawley Council

Simon Blackburn    Blackpool Council

Steve Houghton      Barnsley Council

Jon Collins                 Nottingham City Council

Robin Wales             Newham Council

Alistair Bradley        Chorley Council

Stephen Alambritis            Merton Council

Darren Rodwell       Barking and Dagenham Council

Ian Maher                 Sefton Council

Ros Jones                  Doncaster Council

Roger Lawrence      Wolverhampton Council

Martin Gannon       Gateshead Council

Tim Swift                   Calderdale Council

Cliff Morris                Bolton Council

Pete Lowe                 Dudley Council

Tony Newman         Croydon Council


Birmingham already leading the way on Government’s housing plan

The Government’s Housing White Paper appears, on the face of it, to be a welcome if somewhat overdue admission that the housing supply market is broken and cannot be fixed if left entirely to the vagaries of free market forces.

In a change of direction, the Secretary of State, Sajid Javid, has made it clear that state intervention will be necessary if the number of homes required to address the housing crisis are to be built, and that local government must play a leading role in overseeing a sharp increase in the rate of construction.

Indeed, commenting on social media after publication of the White Paper, Mr Javid said something with which I am able to agree entirely: “Our broken housing market is the biggest barrier to progress in Britain today.”

This council’s strategy of working with all housing providers is I am sure being recognised by Government as a model to follow.  We now need the Housing Minster to emphasise that local government’s role should include the provision of new social housing as well as providing homes for private rental, and that the Government is serious about affordable home ownership.

Two themes in particular running through the White Paper will be welcomed in Birmingham.

The first, a £3 billion fund to help smaller building firms challenge major developers, should improve the supply side and help to create and safeguard jobs in the construction industry. It is vital that a broader range of organisations be encouraged to build homes, rather than the ‘usual suspects’ of five or six construction conglomerates, that have failed to deliver adequately in the past.

The second theme, reducing the time allowed between planning permission and the start of building from three years to two years, will serve as a clear signal to developers that they cannot sit on land once planning permission has been granted and must get on with the job.

As the White Paper notes, correctly: “There is concern that it may be in the interests of speculators and developers to snap up land for housing and then sit back for a while as prices continue to rise.”

The Government’s proposed housing strategy comes not a moment too soon if the pressures on all councils to meet the growing needs of citizens are to be met. I’m pleased to report that the Birmingham Development Plan (BDP), setting out how we intend to respond to the demand for new homes, has been approved by the Government.

We must not underestimate the scale of the challenges that lie ahead. The BDP makes it clear that some 89,000 new homes will be required for Birmingham citizens by 2031. We estimate there is sufficient space within the city boundary for just 51,000 homes, leaving 38,000 properties to be built in neighbouring local authorities across the city border.

It has been necessary to identify a small proportion of the Birmingham green belt, in Sutton Coldfield, to build up to 6,000 homes. This is a strategy that has been wholly endorsed on the grounds of “exceptional need” by the Secretary of State for Communities and Local Government.

Radical plans to build new homes in Birmingham city centre are taking shape. We expect over the next few years to deliver 10,000 properties at Smithfield, Snow Hill and Curzon Street, an unprecedented rate of growth in city living.

It is precisely because we have been able to identify extensive city centre land for housing development that we can limit building on green belt land.

The housing crisis can only be fixed through local government intervention and Birmingham city council stands ready to play a leading role through the Birmingham Municipal Housing Trust, which has built over 2,000 new homes for sale or affordable rent since 2009, with plans for up to 500 homes for affordable rent also in place.

I also note with interest the following statement in the White Paper: “Housing markets are different right across the country, and we are interested in the scope for bespoke housing deals with authorities in high demand areas, which have a genuine ambition to build.

“We will look seriously at any request from local authorities for Government powers to be used to support delivery in their local area, and will be prepared to consider all the levers at our disposal to do so, so long as this results in genuinely additional housing being delivered.”

Birmingham is certainly a high demand area for housing, and this council has a genuine ambition to build, so we will be taking the Government up on its offer.

Cities plan for industrial success in the home of Joseph Chamberlain

Joseph ChamberlainThe Core Cities group of leading UK councils will meet in Birmingham’s Highbury Hall, the ancestral home of Joseph Chamberlain, for an ‘industrial strategy summit’ tomorrow. 

The leaders of the UK’s largest cities are gathering in Birmingham to discuss hugely important economic and social issues at a time when city regions have never been better placed to play a major role in solving many of the problems facing Britain.

The Core Cities group – Birmingham, Bristol, Cardiff, Glasgow, Liverpool, Leeds, Manchester, Newcastle, Nottingham and Sheffield – represent the UK’s largest city economies outside London. They are the economic drivers of the nation.

It is, I think, highly significant that local government’s biggest players have decided to hold a two-day meeting at Highbury Hall, the ancestral home of Joseph Chamberlain, one of Birmingham and Britain’s greatest Victorian municipal leaders.

The symbolism of this could hardly be greater. Chamberlain, as a successful businessman, instinctively realised that city economies cannot grow without social reform. Decent housing, good public health, workforce skills – all of these things are the essential ingredients for economic prosperity.

Investing in the people of our cities and their public services is as important as investing in the physical infrastructure, and that’s as true now as it was in 1873 when Chamberlain first became mayor of Birmingham.
Joe Chamberlain was the father of inclusive economic growth. He realised that big social reform makes economic and business sense because without a healthy and happy workforce you have an under-performing economy.

He did big, bold things and recognised that the citizens of Birmingham could be the city economy’s greatest asset, by improving their lives and their conditions. He knew that was good business and good economics and made businesses grow.

Almost 150 years ago Chamberlain ran Birmingham as a radical and reforming mayor. Today, good local government is just as important, perhaps even more so, to the lives of citizens.

The ten Core Cities urban areas deliver 28 per cent of the combined economic output of England, Wales and Scotland and are home to almost 19 million people, 30.7 per cent of the combined English, Welsh and Scottish population. The West Midlands economy is greater than that of Wales.

Core Cities is keen to work with the Government to tackle difficult issues, most notably trading arrangements in a post-Brexit world, the development of a new Industrial Strategy, and embedding inclusive economic growth in all we do to make sure Great Britain plc works for everyone, not just for a privileged few.

We want to find ways to increase social mobility and address the insecurity experienced by a growing section of the population that feels left behind by rapid global change. We know we have to find ways to reverse inequality between neighbourhoods as well as between individuals.

But this reform agenda cannot be pursued successfully without healthy city region economies.

It makes perfect sense for any Government to want city regions to do well because Britain’s future as a trading nation is tied irrevocably to the performance of the great cities. I for one look forward to responding to this week’s Government Green Paper on Industrial Strategy.

Strong cities will mean a strong global Britain in the post-Brexit world, just as they drove the nation’s wealth in the Victorian era of Chamberlain.

Throughout history cities have always played a vital role in the national and global economy, but in the past few years their importance has increased. The real growth is in the big cities – the places where people come together to innovate and invent new forms of wealth creation and the places where cultures mix and quality of life is enriched.

National economies rely on international flows of trade, labour and commerce between cities. Cities must therefore be empowered to compete on an even playing field with their more devolved continental counterparts – and that means giving UK cities greater powers and tax-raising functions.

To be successful the Government’s Industrial Strategy must recognise the link between social and economic policy in building long term relationships with industry, and delivering inclusive growth.

Big things are happening in Birmingham now and Chamberlain, I hope, would have approved of our ambition. In uncertain times, you can rest assured that Birmingham and the rest of the Core Cities won’t simply ‘adapt’ to the post-Brexit world – we’ll help shape it.

Here in Birmingham we’re not simply waiting for an Article 50 starting gun. I’ve recently led trade missions to Hong Kong, Singapore, China, Qatar and Chicago in an effort to sell Birmingham as a post-Brexit investment opportunity.
And that is something I’m sure Joseph Chamberlain would have approved of, and he would certainly have welcomed Theresa May’s commitment to working with all of our ‘great regional cities’.

Winston Churchill said of Joseph Chamberlain: He was the man who made the weather. He was a man who led where others followed.

And just over 100 years after the great man’s death, you can be sure that Britain’s cities are ready once again to lead from the front.

So my message to the Government is: give cities the powers and we’ll deliver – not just for Birmingham and the West Midlands, but for Britain.