Eric Pickles: I protected North East from bigger cuts

  • 10 June 2011
  • From the section England
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To many council leaders in the North East he's the axeman, the devil incarnate, the man responsible for the cuts which have caused such pain.

But on his visit to Tyneside, Eric Pickles insisted he had gone out of his way to give extra help to the region.

The Communities Secretary even told me he'd taken money away from wealthier areas in the south to help out poorer councils in the north.

He said: "I made the system more progressive by adjusting the formula for need rather than just per head of population.

"And I introduced some transitional relief for areas like the North East which they wouldn't have got under the cuts Labour planned to certain grants.

"So I have gone out of my way to help an area like this."

Disgruntled politicians

That's not the perception of many council leaders though.

Eric Pickles met with South Tyneside Council leader Iain Malcolm during his visit.

And Iain Malcolm said he was going to tell the Secretary of State exactly how disgruntled the North East's politicians are with him.

He said: "When Eric Pickles leaves South Tyneside and the North East, he will be under no illusion about the depth of feeling in the area about the local government settlement he negotiated with the Treasury.

"When South Tyneside residents lose £250 per head in government grant, and yet rich and prosperous areas like Maidenhead, Windsor, and Kensington and Chelsea lose less than £5 per head, it is unfair and unjust."

Eric Pickles
Eric Pickles at British Telecom office under construction in South Shields .

So who's right?

Well, both are in a way.

Government grant

Councils in the North East are more dependent on government grants, so a 20% cut in the grant will certainly take more money out of South Tyneside than Maidenhead.

But Eric Pickles argues that the larger government grant is already there to compensate poorer areas.

He is also right to point out that he did cushion the blow for some councils by capping the amount they could lose.

Without that intervention, councils like South Tyneside and Middlesbrough would have lost even more money - but as they still lost more than any other councils in the country, it was of little comfort.

Mind you, it's not just Labour councillors in the North East who are upset with Mr Pickles.

The Politics Show has been speaking to Cumbria County Council leader Eddie Martin.

He's a Conservative but is still exasperated with the Communities Secretary. Cllr Martin compares Mr Pickles to a steamroller, with no empathy for the pain the cuts have caused.

More money

That was something I put to Mr Pickles. He promised rather ominously to give Mr Martin a call soon. But he did try and be conciliatory.

He said: "I am in a hurry, I'll confess that, but maybe I should be giving out a bit more love in the future."

I'm guessing the councils might prefer more money!

And there may be more battles ahead.

At a dinner at the end of his visit, Mr Pickles confirmed his enthusiasm for the localisation of business rates.

Eric Pickles and reporters
Eric Pickles faces up to the media during his visit to South Shields.

Rates are currently collected locally but go straight to the Treasury's coffers. Localisation would see councils keep some or all of their locally-raised rates.

Eric Pickles believes that will give councils more independence and extra incentives to attract employers in.

But it's an idea which frightens many northern councils, who fear their lack of a business base could see a massive redistribution of money from the north to the more prosperous south.

Places like Northumberland and Durham could really suffer under full localisation.

Mr Pickles insists there will be a method of helping councils in that position, and they won't suffer.

But for now it does look likely to provoke yet another clash between the Secretary of State and the region.