Lord Jackson of Peterborough (Con)

My Lords, I will speak briefly on this issue. I find myself in agreement with both my noble friends Lord Porter of Spalding and Lord Fuller, because they are both right. My noble friend Lord Fuller puts his case with great elegance and eloquence, and has experience of having led a district council and being involved with the District Councils Network. We have something in common because I was also once vice-president of the Local Government Association and had the great honour of being a Front-Bencher for Communities and Local Government in the other place. I want to focus on a particular aspect that concerns me about the unintended consequences of these fiscal changes and their effect on local government. There are huge demographic pressures that no government can get absolutely right, because no government can deal with, for instance, the problem of unaccompanied children that faces councils such as Kent County Council; social care for the over-85s, the number of whom is going to double in the next 20 to 25 years; children’s transport services, with the number of children who are given statements for special educational needs; and, of course, pensions in local government. These are all issues that any party in government is going to have to deal with, irrespective of how well-meaning Ministers are and how hard civil servants work. My concern stems from what has happened recently in Peterborough, where the gap between the available budget and spending is around £20 million, which, for a small unitary, is a significant amount of money. The reserve has been reduced, over just one year, from £45 million to £14 million. My worry is about what Lord Macmillan, Harold Macmillan, described in 1985 as “selling off the family silver”. The problem with such a broad-brush fiscal change as this is not that it will necessarily force many authorities into a Section 114 situation where they are, de facto, bankrupt, but that it will force them to dispose of very important long-term assets, which they will never get back.