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Local Government Funding (Poole)

This is not the first time that I have debated local government finance in Poole; it probably will not be the last, since we have a perennial problem with the shortage of funding from central Government. It does not seem to matter what system is invented by the people in the Office of the Deputy Prime Minister, we always seem to come out very much at the bottom end of the table. So whether it is the standard spending assessment, the formula spending share or the new system, Poole does not seem to be doing very well out of the system. This year, the total Government grant increase is the minimum, which is 2 per cent. The unitary authority average, against which I shall compare during this short debate, is 2.8 per cent. Our total formula grant will be £22.8 million, which provides funding of a little under £167 per head. The unitary average is £330. That difference is worth nearly £22.3 million—a substantial sum that could make a significant difference to the quality of services delivered to my constituents in Poole. I will not go into too much technical detail—not least because the new funding system, with its four blocks, is a little more difficult break into and break down when trying to find out the reasons why the grant is at a certain level—but the finance officers in Poole certainly feel very disappointed with the new system, which they think is complex and rather less transparent than the older system. The Minister might acknowledge the fact that the Local Government Association and others have criticised the new system. None of the 150 education or social services authorities is receiving what the formula grant needs and resources calculation determines: 70 of them are at the floor and gaining more—including Poole, which is getting an extra £323 per head—and 80 are having their grant reduced or dampened to ensure that they all receive a minimum grant increase. That fact indicates that the formula system does not work, and there are real concerns about that. What special issues do we have in Poole? Wages are certainly low. The average weekly wage for full-time workers resident in Poole was £448.50—86.4 per cent. of the average for England—but that contrasts with house prices, which are particularly high. The average selling price of all houses sold in Poole in 2004 was just over 10 times the average annual full-time income. That big gap has a great impact on the local authority’s finances and recruitment. The population is ageing. Compared with the rest of the country, a smaller proportion of Poole’s population is found in all five age bands under 50 and a greater proportion in all age bands over 50, across both sexes. Currently, about 54,500 people in Poole are aged 50-plus, which represents 40 per cent. of the population. Although, when one looks at the Sunday papers, one occasionally sees fabulous houses for sale at extortionate prices, that is not typical of Poole. It might be typical of one or two areas but, along with the areas of wealth, there are areas of great deprivation, including some wards that show up as being very deprived. We have a pretty good local authority. Under the revised comprehensive performance assessment methodology this year, the council has been assessed as a three-star authority. Last year, it was rated as ““good””, which is the second highest rating. Under the new methodology, the ““direction of travel judgment”” concludes that the council has "““improved well over the last 12 months. It has made some significant improvements to services important to local people.””" The council offers good value for money, with costs generally below average.