Only a mile or so separates Cambridge’s Guildhall where Cambridge City Council sits and Cambridgeshire County Council’s Shire Hall however the gulf between what the Liberal Democrats are saying in the two chambers is enormous. The Liberal Democrat groups in each council appear almost entirely at odds with each other when it comes to the councils’ finances. This week I have been observing budget debates in both councils, in Cambridge City Council the Liberal Democrats are the majority party, at the County they are the largest opposition party. At the City Council the Liberal Democrats who are in power are proposing a 4.5% increase in council tax; where they are in opposition at the county they are seeking a cut to the council tax increase proposed there making the increase 2.45%. The reduction of increase they are seeking in opposition at the county is even greater than what Labour are proposing in opposition in the City. You could reasonably argue the numbers are incomparable, but the two groups of Liberals are appear at odds on their basic policy.
Pointing out that the Liberal Democrats are inconsistent is hardly news, but I think its worth drawing attention to when it is both so blatant and so local.
Nationally the Liberal Democrats are in favour of scrapping the council tax, though those voting for them in Cambridge in the expectation that locally they agree with this policy might be surprised to learn that Liberal Democrat City Councillor Neal Upstone and perhaps others do not support this flagship Lib Dem policy. We have seen the City Council increase council tax by 4.5% year on year in Cambridge which perhaps indicates they are not using the opportunity available to them where they are in power to reduce the impact of the Council Tax.
Speaking at a Cameron Direct event in Brighton and Hove (Hove actually) on Friday the 13th of February 2009 David Cameron explained the approach of a Conservative Government would be to reward council’s making savings by giving those councils making significant savings extra central government funding enabling them to have no increase in council tax for a number of years. He said the Conservatives would first stop the problem getting worse with respect to the massively unpopular council tax before considering reform. I would have liked to have seen David Cameron make a clearer commitment to reform council tax and give an assurance that he is aware of where reform is needed, such as to ensure groups like the the elderly are treated more fairly. I agree with him that the massive increases in the tax we have seen since its introduction are the biggest element of the problem. I am concerned that his mechanism for enabling councils to stop increasing the council tax might not focus resources in the areas they are most needed.
The last decade, with Labour in Government nationally, saw council tax rise above inflation every year, an article in the Telegraph quotes an 84% rise between 1997 and 2006.
Within Cambridge City the Liberal Democrats have eroded one of the benefits of council tax – a direct link between those paying the tax and the councils and public authorities in receipt of the funds raised. They severed this link for many residents by making landlords rather than tenants responsible for council tax in large numbers of rented properties. They are passing the costs of collection onto landlords, and also by making landlords liable they are improving their collection statistics so it is easy to see why, from a narrow perspective within the council it is see as a good thing. This along with other Liberal Democrat policies such as expanding conservation areas has the effect pushing the price of rented accommodation higher than it would otherwise be. With its students and large population of relatively transient young professionals Cambridge requires an affordable private rented sector to function, and the council ought not be taking action which damages this.
Why Tax to Amass Reserves?
At Cambridge City Council budget meetings Labour and other opposition councillors are asking questions like why is the council tax being raised when, the under the Liberals, the council has amassed such huge (£80m) reserves. At the county council the Liberal Democrat opposition are criticising the ruling Conservatives for doing exactly what the Liberal Democrats are doing in Cambridge City. County Cllr Nichola Harrison, Liberal Democrat spokeswoman for resources, is quoted in a recent Cambridge News article as saying: “People want a council which keeps tax down – they do not want one which thinks filling its coffers is more important than keeping money in taxpayers’ savings banks”. I wonder if Cllr Harrison, a city resident, will use the opportunity for members of the public to ask questions at council meetings to attend Cambridge City Council’s budget setting full council meeting on the 26th of February and put that point to the Liberal Democrats running the City. She might have some influence with members of her own party.
Green Party City Councillor Margaret Wright takes a particularly extreme view on the councils reserves, saying that the council ought not be in the business of making and amassing “profits”.
Conservative City Cllr Howell is calling for a late cut in the City’s council tax increase.
External Borrowing, or Borrowing from Reserves
Despite having £80m of investments the Liberal Democrats at Cambridge City Council are proposing taking an external loan in 2010/11; one of the purposes of this loan is to keep revenue reserves at an acceptable level. Labour proposed an amendment to the City Council’s budget on Friday the 13th suggesting the council ought not take out the proposed loan.
At the County Council roles were reversed, here the Liberal Democrats were the ones criticising borrowing while holding substantial reserves. David Jenkins, the Liberal Democrat group leader suggested the county council ought to borrow from its own reserves before considering external borrowing. He said the Liberal Democrats’ financial advisors said that there was no difference in risk between borrowing from reserves and borrowing externally. I wonder if David Jenkins has shared this advice with his fellow party members at the City Council?
County Council leader, Conservative Cllr Jill Tuck said that the council’s reserves were all earmarked, she said that meant they were all to cover planned spending or predicted risk. She also claimed that the council’s general reserves were at the lowest level deemed acceptable by the council’s external auditors. Cllr Reynolds also defended the council’s stance saying reserves were “needed to weather the storm”.
Making Savings Without Cuts
At Cambridge City Council opposition councillors are asking how savings have been made, yet Liberal Democrats insist there are to be no service cuts. Where they are in opposition at the County, they are the ones who are incredulous at the ruling party’s claims. David Jenkins, the Liberal Democrat group leader asked the ruling Conservatives: “How are you making all these savings yet saying services won’t be affected – how is that realistic?” and “Why can’t you be more honest and admit that cuts might impact services?”.
Liberals at the County Council accused the ruling Conservatives of a lack of transparency and made accusations of obfuscation. Questions / points included:
- How do we tell what is a cut, and where savings have been made but the level of service will be unaffected?
- Why aren’t the links between the revenue and capital budgets clearer?
- What inflation assumptions have been made?
- We’re being given details on cuts / changes but don’t know the total amounts involved. (Cllr Batchelor said he “would like to see clear lines showing total budgets”)
While there have been no charges of obfuscation at the City Council, the latter three questions have certainly been asked, with justification, of the City Liberal Democrats.
At the City Council the Labour and Conservative opposition complain about ineffective scrutiny, often pointing to the County Council, where there are opposition chairmen of scrutiny committees as having a better system. At the County Council’s budget debate the Liberal Democrats complained about the poor attendance of Conservative cabinet members at scrutiny meetings, saying that most of the time they were scrutinising officers, not the political leadership.
Further notes from the County Council’s Budget setting Full Council on the 12th of February 2009
Liberal Democrats started their criticism of the Conservative’s County Council budget by pointing to three “slugs” of £2M which they said had allocated without detailed plans for how it was to be spent:
- £2m on climate change “so you can say you’re doing something”
- £2m on roads
- £2m on the economy, just in case you need it.
Cllr Huppert (Liberal Democrat, East Chesterton) was very critical of all extra spending being termed “investment”, even when its not an investment eg. cost overruns on the guided bus or costs of services increasing. He said that saying “we’ll spend more giving you the same things” was not an investment.
Liberal Democrats were very critical of last minute changes, calling them “fag packet” changes.
Public consultation results were taken to same cabinet meeting as the budget – raising questions as to the real input from the expensive and relatively extensive public consultation.
Liberals challenged press releases they said had been made by the Conservatives describing Cambridgeshire as the most improved council; saying this was inaccurate as the report they were referring to focused on performance indicators not the whole council. They cautioned the Conservatives against believing their own propaganda.
A Liberal Democrat said the Conservatives had promised “top quartile performance with bottom quartile results” and said: “It looks like we’ve got that reversed”.
Cllr Reynolds spoke about growth saying that the Government Grant increase did not correspond to the increasing population, he said that even given the housebuilding slowdown people were still moving to the region. David Jenkins said that the county’s total government grant was close to average.
Children and Young People
The chair of each scrutiny committee addressed the meeting commenting on their area’s budgets. John Batchelor the chair of the Children and Young People’s Services Scrutiny Committee was the first to speak. His major criticisms were a concern over the funding levels for the “youth service”, he said respite care would be hard to provide without service cuts. On home-school transport he said the council was “not getting to grips with getting control over contracts”. Positively he said he was excited by new plans for education other than at school and noted that trading (catering) was back into profit. Councillors were all limited to five minutes speaking time, which didn’t leave much opportunity for those who had a lot to say to embellish their points.
Labour Cllr Hughes of King’s Hedges spoke to praise the council’s work during the year with young people, including the G2G card and better play facilities. She gave a speech on how “Play is an important part of children’s lives, and indeed everyone’s lives”, she said that there was a duty on the council to provide children educational activities outside of school. She said that in her ward there were many youths getting a good education in anti-social behaviour and said there was a need to compensate for and compete with this by providing better services for drama, music and sport.
Cllr Ballard welcomed a recent decision made to give funding for those excluded from schools to the secondary heads, who had accepted it, making them responsible for providing the target of 15 hours a week tuition for these people.
Labour Comments on the County Budget
Cllr Paul Sales led for the Labour Opposition at the county council in the budget debate. He said his party did not have the resources to be able to present a budget amendment, but he would be making comments. He started by drawing attention to what he called cuts in “adult support services” and talking about the demographic shift in the county’s population – a subject which is discussed throughout the budget. He said improvements in health care were resulting in more people living with long term illnesses and disabilities, he said we are going to need to provide more services for the aging population. He felt it would be difficult to sustain service levels with repeated cuts to funding. He talked about the standards of residential care homes and suggested the council would not be able to meet all regulatory requirements. He said he would like to see a focus on “reablement”, he didn’t explain the meaning he attaches to this buzzword or exactly where he would like to see resources placed.
Responding first on “adult support services” the Conservatives pointed to increased choice and control though self-directed support. Cllr Sales expressed concern that there was now less money for people to choose how they spent.
Cllr Sales spoke in favour of a prudent budget, pointing out that the future is unknown saying that there had to be scope to react to potential events such as a Flu Epidemic.
Cllr Sales spoke in support of the council’s aim to enable more people to dye at home rather than in hospital if that was what they wanted. He said that there needed to be a transfer of funds from the health authority to the county council to fund this.
There was very little discussion on this point with only three points raised. Cllr Hughes asked what the relationship was between street lighting and demography, and was told that when more people move into the area and homes are built there are more streetlights.
Cllr Batchelor asked if the Highways budget would get through to the end of the year, saying it has been spent by September in the current year. Most councillors appeared to treat this as a silly question – presumably the answer is it is obviously an insufficient budget – he didn’t get an answer.
Some discussion on the A14 followed, with the Conservatives pointing out the fact that the Liberal Democrats are dithering and constantly changing their opinions on what ought be done.
The public gallery at Cambridgeshire Shire Hall is not very good, you can’t see most of the chamber from all but the front row, and it is only accessible by lift. With permission it is apparently possible for observers to sit behind the councillors in the chamber itself.
There are 69 County Councillors, I imagine most were present at the meeting; yet during the two-three hours I was observing only about seven or so spoke, most sat in silence.