Luke Taylor

It is, as always, a pleasure to serve under your chairship, Dr Murrison. I thank the hon. Member for Dulwich and West Norwood (Helen Hayes) for securing this important debate at an opportune time. “The streets of London are paved with gold”—or so the saying from the tale of Dick Whittington goes. But of course the point of that saying was to remind us that he did not, in fact, encounter riches and utopia when he got to London. That has been inner London’s story for centuries: portrayed as pampered by the rest of the nation while its people grapple with some of the biggest challenges imaginable. I am a proud Londoner, I am an MP and a still councillor in London, I am my party’s spokesperson for London, and I know vividly how drastic the challenge is across London. I have knocked on doors across the city and heard directly from residents about their challenges, their fury at the last Conservative Government and now their disappointment with the Labour Government. London is a city where 2.3 million people—that is twice the population of Birmingham, and one in four people in the city—live in poverty. According to data from the Trust for London, that figure rises to 38% for non-white households and 53% for single-parent households. It is a city where SEND deficits and adult social care deficits have thrown council finances into uncertainty for more than a decade. It is a city where, perhaps most shockingly of all, a teacher in every school can walk into their classroom in the morning knowing that, on average, at least one of their pupils at any given time is likely to be living in temporary accommodation. Year after year councils in London have been asked to do more with less. Reform of the system is long overdue, with the current formula not having been properly updated in more than a decade—not to mention the fundamental unfairness of the council tax system to raise money for local services. We were told by the Government that there would not be a return to austerity on their watch. It was a claim that most of us could believe, not just because they are a Labour Government with a social democratic tradition, but because they are a Government full of former councillors and council leaders who have seen at first hand that the reality of austerity is often most severe in local government. It is therefore outrageous that they have presented a funding review that simply doubles down on the disastrous cuts. Over the next three years, per capita funding, when council tax contributions are removed, will reduce by £109 in Camden, by £79 in Lambeth, by £75 in Southwark, by £37 in Lewisham, by £180 in Wandsworth, by £54 in Greenwich, by £220 in Hammersmith and Fulham, by £86 in Islington, and by £247 in Westminster and in Kensington and Chelsea. What is that if not Labour austerity? The current formula makes use of the index of multiple deprivation as the central measure of poverty but, as has been said many times, the IMD as currently designed does not properly reflect housing costs, housing poverty and what it means to be poor in a city where rent alone can swallow well over a half of a working person’s income. If we build a funding formula that ignores housing costs, we build one that blatantly ignores inner London. I am an engineer and know bad maths when I see it, and the proof that the Government’s latest announcements, published just this week, are smoke and mirrors is right there in the forecasted effects. Two thirds of the purported increase in total funding in London comes from the assumed council tax increases. When we account for that fact, we see that over the three-year settlement period, only two of the 12 inner-London boroughs—Hackney and Tower Hamlets—receive a real-terms funding increase per capita from the Government. Government Members like to talk about the austerity during the coalition period, but perhaps they would like to reflect on those figures for per-capita funding when council tax contributions are removed, which are a result of this Labour Government, and the effect on their inner-London residents. I have lots of data, which I am sure the Government know to be true, but a person does not have to be expert to know that the Government’s numbers do not add up—they just have to walk a few miles away from this place. I thought Labour Members were supposed to be in tune with and sensitive to inequality, yet here we are in a palace that is increasingly a boundary to their views while just a few minutes away, in Lambeth, Southwark, north Kensington and Chelsea Riverside, people are suffering because their councils are choked of the funds that they need to protect them. The support that this Government promised to deliver never materialised. Those working people have already been hit by inflation, the cost of living and rising transport fares. They now face not just lesser services but the prospect of huge council tax hikes because of this mess, which Labour might not have made but is doubling down on. Londoners are sick of being utterly let down while being told that they have never had it so good, or that they have a Government and a mayor who are on their side. I do not doubt that Labour Members’ intentions are good, that they got into politics for the right reasons, or that they have had incredible achievements as councillors—I am proud to have done that myself—but I sincerely ask them to please get their house in order and provide what London needs. With the devil in the detail of their unfair funding review, they are proposing the exact opposite. They have just a couple of months to get their act together before the local elections, but I suspect that for most Londoners the die is already cast against Labour because of its lack of care. This is not a sustainable foundation for any public service system. It is not fair funding; it is the accelerated starvation of a vital part of the public realm, masked by cosmetic changes. The Minister has heard it from around the Chamber; it is not just me ploughing a single furrow. If the Government are casting about trying to understand why people are not warming to their efforts—perhaps more so this week than ever before—they should remember that although they can mask an unfair funding formula under snappy headlines and public relations gloss, they cannot make it function as a good policy just by wishing it so. That is government by magical thinking. I am racking my brain trying to imagine why Members on the Government Benches cannot see the wood for the trees on this topic. I can only guess that they simply do not grasp the true value of well-funded, well-functioning and truly independent local government. I know that that is not true for some of the Members in this Chamber, who have come from local councils in inner and outer London. However, they are unwilling to challenge the dangerous idea that local government is a derivative of central Government, and the fact that the mayor’s powers are being used as a convenient shield by a Labour Government who are quietly keeping London in their back pocket for whenever they need someone else to carry the pain—because that is what the fairer funding review amounts to. It is hard to see it as anything other than a plan for managed decline of our cities, with inner-London boroughs first in the firing line. This can only be justified by misunderstanding the aphorism that I began with and not grasping that London’s streets are considered to be paved with gold only when it suits those who wish to ignore its many challenges. I invite the Minister to explain more clearly how a reduction in per-capita funding over the next three years for residents in 10 of the 12 inner-London boroughs that are the subject of this debate will result in better services for those residents.