UK Politics

Labour: Spending cuts hit most-deprived areas hardest

  • 30 January 2014
  • From the section UK Politics
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A child in a deprived area
Image caption Labour says the cuts in the most deprived areas are shocking

The most disadvantaged communities in England are facing the biggest local government cuts, Labour has claimed.

Between 2010/11 and 2015/16, it says, the percentage cut in spending will be 10 times greater in the most deprived areas than in those least deprived.

But the government says the most-deprived councils still have £1,000 more per household to spend than those where deprivation is lowest.

Shadow communities minister Hilary Benn said the figures were "shocking".

He added: "They show the impact of David Cameron and Eric Pickles's unfair policies."

'Clear link'

The Labour Party says its research combines analysis from Newcastle City Council on the amount which councils across England have to spend on services with the government's own figures for "multiple deprivation".

Labour has published this information in a graph which it says shows the "clear link between cuts in spending power and deprivation".

As deprivation increases, the "cumulative cut" between 2010/11 and 2015/16 also appears to rise.

The 10 most deprived areas, which include Liverpool, Hackney, Manchester and Middlesbrough, face an average reduction in spending power of 25.3%, according to Labour.

The party says the 10 least deprived areas, which include St Albans, Elmbridge, Waverley and Wokingham, are dealing with an average cut of just 2.54%.

Deprivation is measured using indices previously published by the Department for Communities and Local Government. The measure includes income, employment and health deprivation, as well as disability, crime, education and barriers to housing and services.

Competing arguments

It's not the first time the government has faced accusations of unfairness in council funding, and ministers have swiftly rebutted Labour's figures.

The local government minister, Brandon Lewis, said: "The coalition government has delivered a fair settlement to every part of the country, north and south, rural and urban, metropolitan and shire.

"Councils facing the highest demand for services continue to receive substantially more funding... This shows that the government understands the pressures faced by deprived authorities."

The difficulty with assessing the validity of the competing arguments about the funding squeeze is that councils are raising money in different ways.

Image caption Ministers say councils should not rely so much on central government handouts

Those areas of high deprivation tend to be the ones that are very reliant on grants from central government.

In places such as Liverpool, Newcastle and Birmingham, large money transfers from government departments are used to pay for many services.

The least deprived, which include parts of Surrey and Sussex, tend to fund their services mainly through council tax and charges for things such as parking.

Cuts in central government grants, by their nature, tend to hit those areas most dependent on government support.

Communities Secretary Eric Pickles has argued that action was taken to dampen the effect, by making sure that those areas most dependent on government grants had lower reductions in central government funding.

Building more homes

Ministers also believe that councils should in the longer term become more efficient and less reliant on central government handouts.

They have repeatedly expressed a desire to end the "begging bowl" culture of councils totting up their "needs" and then sending the bill to central government.

Local authorities are encouraged to find ways of developing their own income, for example by keeping a share of the proceeds when the amount raised by business rates increases.

Ministers say councils are also being rewarded for building more homes and generating jobs.

But closing the gap between the most deprived and least deprived areas will take a long time, if indeed it is happening at all.

Labour says, in the meantime, local government cuts are hitting those most in need.

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