Liberal Democrat Inconsistency in Cambridge


Monday, February 16th, 2009. 5:32am

Cambridgeshire Shire Hall
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.

Council Tax

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.

More Inconsistencies:

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?”.

Transparency

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.

Scrutiny

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.

Environmental Services

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.

Observing

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.

8 comments/updates on “Liberal Democrat Inconsistency in Cambridge

  1. Richard Article author

    Letter for consideration for publication:

    Liberal Democrat County Councillor Nichola Harrison, writing in a letter published by the news on the 19th of February, criticised the Conservative county council for increasing council tax by 3.9% while amassing ever increasing reserves. Her letter might have been more effective if it had been addressed to her Liberal Democrat party colleagues who run Cambridge City Council; they are proposing a 4.5% increase in the city council element of the council tax while sitting on substantial reserves and investments of ~£80 million.

    Liberal Democrat inconsistency and hypocrisy might not really be considered news, but given this is so local, and so many Cambridge residents have a history of voting Liberal Democrat I thought it was worth drawing attention to. I have noted further budgetary inconsistencies on my website: http://rtaylor.co.uk/707

    Cambridge City Council’s budget setting debate is to be held in the Guildhall at 6pm on Thursday the 26th of February, it’s open to all.

    Richard Taylor
    (Independent)
    Cambridge
    http://www.rtaylor.co.uk

    This was published by the Cambridge News on the 2nd of March 2009

  2. David Vincent

    Richard

    It’s simply incorrect to say the Lib Dems in the City severed the link between Council Tax and residents “by making landlords rather than tenants responsible for council tax in large numbers of rented properties”. The legal position is quite clear. The landlord of an HMO is responsible for paying Council Tax. Many landlords have sought for years to avoid this responsibility (or to pass it on to their tenants by dubious means) by concealing the fact that they were letting properties as de facto HMOs. And, of course, this concealment avoided several other legal responsibilities as well. I wasn’t aware that the Lib Dems had increased detection and enforcement in this area to any great extent. If it has been happening, I imagine it was largely driven by officers in the housing standards team.

    Any increased regulation of the private rented sector will always be used by landlords to justify increased rents. In fact, landlords will mostly charge whatever the market will let them get away with, in exactly the same way that those selling houses will sell for as much as they can get.

    The issue of landlords having to pay Council Tax affects only one small part of the private rented sector, shared housing for non-students. The greatest rental inflation I have seen has been in the charges for speculative new-built one bedroom properties, presumably bought up as “buy to let”. I am unsure who affords to pay these rents (and the accompanying Council Tax), but I assume the properties are being rented, rather than remaining empty.

  3. Richard Article author

    David,

    My point is that Cambridge City Council are going above and beyond what they are permitted to do by law.

    I have been told by one of their officers that they are applying the definition of a HMO in the Housing Acts rather than the definition of a HMO in the Local Government Finance act to the collection of council tax.

    In Cambridge the professional sharing market is not particularly small, it is also important for the local economy.

    I also think the Liberal Democrat’s expansion of conservation areas is having the effect of pushing students and professional sharers out of prime city centre areas.

    Even where a landlord is responsible for council tax I believe it is important that the tenants get a copy of the council tax bill with the breakdown and are also included in relevant mailings from the council, police and other groups such as the local policing plan. It is not right in my view for this group to be disenfranchised whatever the reason is they do not get their own council tax bill.

    As for what is driving the council’s actions, I believe it is the headline council tax collection rate statistic. Cambridge, due to its higher than average transient population and high turnover has historically found collection difficult, I believe moving responsibility to landlords helps improve the collection statistic enormously.

  4. David Vincent

    My own view is that the definition in the Housing Acts is, in fact, narrower than in the CT legislation, which reads

    “A property that has been built or adapted for tenants or licensees to live in, who are not living as a sEingle household”

    Simply locks on individual rooms can be seen as “adapted” in this sense.

    In my experoience, young professionals in shared houses rarely “live as a single household”, unlike say students (whom case law agrees are more likely to live somewhat communally).

    If Council departments are using a common definition, it is probably in the landlord’s favour on this point. The Housing Act definition carries much more regulatory burden, of course.

    I also think it not unreasonable of the Council to favour simplicity in collection processes. I take your point about the democratic deficit, but that argument is the one that was used in favour of the community charge \ poll tax and, in the end the difficulty and expense of collecting that tax (especially amongst a transient population) was a major factor in its demise. Property based taxes are easier to collect as property doesn’t move and ease and cheapness of collection is an important element in any taxation regime.

    As far as conservation areas go, this is an inevitable response to gentrification, which is itself the result of the absurd and unjustifiable increase in property prices in the area.

    Students are hardly being pushed out, so much as the traditional bedsit areas are having to expand to absorb the remorseless increase in student numbers. And both universities and several speculative developers have been building hostel blocks for many years.

    The ones losing out are the low-paid workers (now principally recruited from abroad) who are forming a high proportion of current newer HMO households throughout the City (and beyond, in the fringe developments in Arbury Park and Cherry Hinton). And I would assume voting figures among that community are infinitesimal.

  5. Richard Article author

    For Council Tax purposes the relevant definition of a HMO is:

    *A property that has been built or adapted for tenants or licensees to live in, who are not living as a single household,

    OR

    * A property lived in by a person or persons, each of whom has a tenancy or licence to live in only part of the property or who pays rent or a fee for only part of the property.

    In order to justify Cambridge City Council’s current stance of including unadapted houses their property inspector, a Mr Lovelock, is making what I consider to be ridiculous judgements as to what counts as an adaptation. I think it is clear from the phrase “built or adapted” that an adaptation needs to be related to the fabric of the property. Mr Lovelock is however making assessments based on how a property is used, it is this which I think is particularly wrong. It is none of the council’s business how people live in their homes. The homes I am concerned about fall below the threshold in the Housing Acts where they require certain adaptations / features.

    Additional information not supplied to those not receiving their own council tax bills includes:

    1. Best Value Performance Plan summary
    2. “Council tax booklets”

    I wrote to my local councillors in May 2008 to say I would like to see:

    Councillors weigh-up the pros and cons of removing tenants’ direct connection with the city council which arises as a result by paying council tax to the council. The con is the lack of a connection with the council through the broken down council tax bill, policing survey, leaflets such as those I’m referring to here etc. The pro might be an increased collection rate of council tax (though this would be a misleading statistic as the increase in collection rate will come at the expense of landlords, and this expense will be passed on to those renting property privately in Cambridge). At the moment I am concerned this decision is being made by very junior staff, with no oversight of its consequences by either senior officers or councillors.

    I don’t think that the fraction of those voting in a particular sector of the community ought affect if we tell them what fraction of their council tax goes to each organisation, or let them get involved in consultations on that breakdown.

  6. David Vincent

    Richard

    Am I missing something? As I read the definition it is incumbent on the Council when making a decision about an HMO to enquire into not only adaptations, but also living arrangements (“as a single household”) and the contractual and other financial arrangements between the occupiers (in shared houses, after all, whatever the contractual arrangment on paper, each occupier pays “rent or a fee for only a part of the property”).

    I expect the decisions the Council makes will sometimes be arbitrary (although as I said before, yale locks on individual bedrooms have been accepted by the courts as an “adaptation” in this context), but I assume they can be challenged by any landlord who feels strongly on the matter.

    But if the main concern is that the information you speak of does not get to the occupiers, perhaps the Council could be pressed to send several copies to each HMO on their records, for the attention of the occupiers (expensive though that might be).

    I agree that all voters and other residents should be fully informed and consulted on what is being done in their name, irrespective of who pays for it. I don’t actually think that the information that has to be sent out with Council Tax bills is necessarily an effective or efficient way of doing that, but it should certainly be available as widely as possible.

    Incidentally, do student households who are not liable for Council Tax because of their exemptions, receive the information in the same form? They vote, of course, but certainly do not have any direct financial relationship with the local Councils they help elect.

  7. Richard Article author

    Generally students in Cambridge do not get sent the information relating to local councils and policing which are sent to those who pay council tax. Sometimes a “zero” council tax bill is generated but this appears to be the exception rather than the rule.

    That is a similar problem, and one I raised at the same time when I spoke at the City Council’s North Area committee on this subject in June 2008. There I also noted that some of those living on the River Cam in Cambridge, who pay a charge equivalent to Band A council tax, but not formally the tax itsself would presumably be affected by this disenfranchisement.

    The lack of connection with the local police, fire service and councils is one of my main concerns. I also oppose any additional tax burden which has a disproportionate effect on some of the poorer sections of society. The lack of appriopriate, affordable, housing for many in this country is a major problem in my view.

    With respect to assessing landlords as opposed to tenants liable to council tax, an example of where I think the decision has wrongly been made would be where simply the use of a downstairs room as a bedroom is counted as an adaptation. This is clearly wrong in my view, those renting a whole house ought be free to decide which rooms they sleep in.

    I have no problem at all with the Cambridge City Council following the letter of the law, this is what they ought to be doing. All true HMOs ought to have their landlords liable for council tax. What I oppose is them going beyond that. Groups of people, not living as a single household, in a non-adapted house ought be liable for their own council tax.

  8. Richard Taylor Article author

    I quoted the law on liability for council tax in HMOs above but didn’t cite the source so I will now do so:

    The Council Tax (Liability for Owners) Regulations 1992 as amended by The Council Tax (Liability for Owners) (Amendment) Regulations 1993 provides via Section 8 of the Local Government Finance Act 1992 that the landlord, not tenant, of:

    a dwelling which

    • (a)was originally constructed or subsequently adapted for occupation by persons who do not constitute a single household; and
    • (b)is inhabited by a person who, or by two or more persons each of whom either—
      • (i)is a tenant of, or has a licence to occupy, part only of the dwelling; or
      • (ii)has a licence to occupy, but is not liable (whether alone or jointly with other persons) to pay rent or a licence fee in respect of, the dwelling as a whole.”.

    is liable for the council tax.

    What I experienced was Cambridge City Council wrongly deeming the landlord liable for the council tax in the case of an unadapted property which I and unrelated others were together renting as a whole. I do hold permission to appeal the council’s decision but I chose the route of lobbying democratically, in part because I don’t trust the state not to erroneously generate a large bill. (The council tax due was all paid; we as tenants paid it to the landlord who in turn paid the council following the council’s illegal and erroneous determination of liability).

    The council’s argument was that if there was an ‘adaptation’ depended on who was sleeping where and how we arranged the furniture. The council’s “surveyor” claimed having a bed in a downstairs room counted as an adaptation.

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