Culture funding attack on PM

Oct 11 2007 Rob Merrick Liverpool Daily Post

A FURIOUS row blew up last night after Gordon Brown claimed a puny rise in local council funding would help Liverpool prepare for its Capital of Culture year.

City council leader Warren Bradley accused the Prime Minister of “spinning out of control” when the city is trying to plug a £20m funding black hole for the showpiece year.

Cllr Bradley also criticised a shock Government demand that councils collectively make £5bn of efficiency savings within four years as unrealistic.

The row came after the Local Government Association (LGA) attacked the settlement for councils in Monday’s “mini- Budget” as the harshest for a decade.

Chancellor Alistair Darling handed out a funding increase of just 1% a year above inflation for the next three years while also capping council tax rises below 5%.

The LGA warned the inevitable consequence would be cuts in social services and care of the elderly.

However, the situation is bleaker for Liverpool, which must find £20m more to pay for Capital of Culture, now less than three months away. The funding dilemma was raised in the House of Commons yesterday by West Derby MP Bob Wareing, who urged Mr Brown to help both the city council and Merseyside police.

“Have you considered any increase in the assistance which will go to Liverpool which next year celebrates its year as the European City of Culture?” he asked.

In reply, Mr Brown congratulated Liverpool on its 2008 achievement. He said: “Having visited the city and seen what is being done to prepare for the City of Culture, there is more urban regeneration taking place in Liverpool than at any time in the last 20 to 25 years.

“The local government settlement and the public expenditure plans announced in the budget will help Liverpool and ensure jobs can be created in the area and also ensure that the urban regeneration continues. We will keep our promises to the people of Liverpool.”

However, ministers have repeatedly refused to give any more money towards 2008, prompting criticism that they favour the 2012 London Olympics.

Cllr Bradley said: “If the Prime Minister is saying that his announce- ments are going to be beneficial to Liverpool, then I look forward to seeing it. However, a lot of people are questioning whether he is spinning out of control at the moment and this seems to be an example of that.

“How can he say that a 1% real-terms increase in funding for the next three years can be of benefit, when we have the many challenges that come with the Capital of Culture year?”

On the demand for efficiency savings, Cllr Bradley said the city had already found £150m-worth since the Liberal Democrats won control a decade ago.

He added: “How much further we can go without affecting frontline services, which we have avoided so far?”

The city council is waiting to hear whether the Government will allow it to use money from land and building sales to help plug the 2008 funding black hole.

Two other options under consideration are remortgaging council property, such as Millennium House in Victoria Street, or raiding town hall reserves set aside for emergencies.

Cllr Bradley’s criticisms echoed those of the LGA, which has estimated the growing cost to town halls of an elderly population at £9.3bn within three years.

Sir Simon Milton, the association’s chairman, said: “This is the worst settlement for local government in a decade. The Chancellor’s announcement will mean above-inflation rises in bills for council taxpayers and businesses and there remains a black hole in funding for the care of the elderly.”

John Healey, the local government minister, described the settlement as “fair and affordable”, because it added up to an increase above inflation.