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Police Grant

I rise to debate some of the details of the police grant, with particular reference to Surrey. I am delighted that the Minister for Security, Counter-Terrorism, Crime and Policing is back in his place, and I am pleased that he acknowledged in his opening remarks that there is a particular problem to do with Surrey police funding. First, let me give some context. Surrey is supplying £5.4 billion-worth of taxation revenue to be spent elsewhere than in Surrey; therefore for a typical family of four, on average £20,000 each year is spent outside Surrey. So Surrey is paying more than its fair share towards expenditure elsewhere in the country. I shall examine the grant formula, and then look at the consequences of how it is applied to Surrey and point to some of the potential remedies that the chief constable recently recommended to the Minister. I wonder whether anyone present—with the possible exception of one or two Home Office civil servants—has any idea how the police grant formula works. It is based on a projected population multiplied by the result of the police basic amount plus police crime top-ups 1 to 7, plus police incidents top-up, plus police fear of crime top-up, plus police traffic top-up, plus police sparsity top-up. It is also revealing to examine the detail of what makes up the formulae. If a resident of Surrey sees that ““single parent households”” and ““student housing”” each appear under three different top-ups and that, to cap it all, under police crime top-up 7 a negative factor is applied for people identified as ““wealthy achievers””, they might then begin to get the general idea that all the formulae will take money and funding away from the county of Surrey. That has, indeed, been the case. One need only examine what has happened in respect of funding per head of population in Surrey since 1997-98 and the introduction of all the formulae and their consequences: the amount of money that Surrey has received from central Government has bumped along the bottom of the floor set by the Government. Indeed, the formulae were set in such a way that if there had not been a floor, I rather wonder whether Surrey would be getting any money at all from the Home Office. The formulae are entirely impenetrable to outsiders; it is impossible for them to find out what they mean in fact. What they mean for Surrey is that it has received no extra money in cash terms in Home Office police grant per head of population since 1997. In saying that, I might be guilty of misleading the House because the truth is that in 1997-98 the Home Office grant per head of population for Surrey was £57.80, whereas this year it has risen to the princely sum of £58.33, so it has in fact gone up by 53p per head in cash terms during the 10 years of this Government. Meanwhile, however, in order to deliver policing in Surrey, the council tax per head of population that goes to support the police has increased from £19.51 to £77.15. The Minister has said that the proportion of Surrey's police funding coming from the council tax payer is approaching half, but national non-domestic rates are also raised in Surrey. Only 40 per cent. of the national non-domestic rates raised in Surrey are then spent in Surrey, and that is scored as national expenditure for the purposes of the Minister's definition of national, as opposed to local, expenditure on the police. If one scored the national non-domestic rates raised in Surrey as local expenditure, about 64 per cent. of funding for the police in Surrey would be coming from Surrey taxpayers in one form or another. Surrey's position is extreme, and to see that, one has only to look at the different sets of formulae that were introduced in this House in 2005, all of which acted in precisely the same way to ensure that Surrey's expenditure was sustained only by the floor that the Government have put in place. I am afraid that the conclusion that my constituents and I are entitled to reach was summed up by the sedentary intervention by the hon. Member for Carlisle (Mr. Martlew). When Surrey's expenditure was mentioned he said, ““They can afford it.”” Some £5.4 billion-worth—or, by other accounts, £5.9 billion-worth—is being exported from the county to be spent elsewhere in the country, and there comes a limit. That limit has been reached. As an aside, I shall examine the interesting additional rule 1 to be applied by the Home Secretary. I wonder why something similar to what applies in Wales does not appear to apply in England. The rule states:"““The Home Secretary has decided that the grant provision under the principal formula for South Wales Police Authority””—" which includes the capital of Wales—"““shall be reduced by £2,383,426””." Instead of being given to the police authorities in England and Wales, that money is simply redistributed among the Dyfed-Powys, Gwent and North Wales police authorities. If additional rule 1 is good enough for Wales and allows some adjustment to be made for over-expenditure in Wales's highly populated area to ensure that the policing challenges of its more rural areas can be addressed, why cannot something similar be done for England? Why cannot something similar be contemplated for Surrey, given the crisis that is overtaking Surrey police authority? The Minister will be well aware that I use terms such as ““crisis”” advisedly. Surrey's police force has been in the top end of all the performance indicators over the past 10 years, and it has supplied other areas with some distinguished police officers, Denis O'Connor and Ian Blair to name but two. I have accompanied both of them, and the chairman of the police authority, on delegations of Surrey Members of Parliament to previous Policing Ministers to point out that what was happening in Surrey was going to be unsustainable, yet year in, year out Surrey has sought, through imaginative policing and restructuring solutions, to stem the tide of its enormously difficult financial position. Above all, Surrey council tax payers have ridden to the rescue to ensure some form of sustainable policing in Surrey. We now face the extremely difficult consequences of this settlement. On 23 January, Surrey's chief constable wrote to the Minister, saying:"““I am writing in unprecedented terms to express my professional concerns about the risks to public safety of people in Surrey over the next three to five years, if our funding position is not resolved urgently.””" Behind these formulae lies a basic absurdity in how the conclusion about how much money should go to Surrey is reached. The absurdity is that even if one accepts that the formulae are arrived at reasonably and are a reasonable assessment, they take no account of Surrey's location. If Surrey were moved bodily to the middle of Wales, which is a much lower crime area that has no major crime centres around it, Surrey would receive exactly the same amount of money under the formulae. As we have heard, 59 per cent. of serious organised crime in Surrey comes from outside it. I cannot better the chief constable's remarks about this. He says:"““We are about to hit the tipping point where the majority of burglary, vehicle crime and robbery come from travelling offenders visiting Surrey from neighbouring high crime generating areas including London (currently at 46 per cent.)…I am also able to evidence a range of demands which are a direct consequence of bordering London. The Funding Formula takes little account of these factors””." All that should be more than familiar to the Minister, and, as my hon. Friend the Member for Bury St. Edmunds (Mr. Ruffley) was good enough to make clear, it comes from a police force that has performed at the top end of everybody's expectations in terms of its administrative efficiency. On 11 February, the Surrey police authority will have to set the force's budget, and this grant formula puts it in an impossible position. I understand that it cannot meet the Home Office's requirements on targets and performance within the current budget without busting through the capping limit. I understand that the proposals that will be made to the Surrey police authority on Wednesday for its decision on 11 February will become public. The chief constable has asked the Minister for feedback and urgent discussions on the prospects for a solution. The chief constable's solution is a special grant of £54 million over three years, which would serve only to give Surrey the average funding of other forces around London. The Minister's opening remarks directly acknowledged the fact that Surrey faces a particular problem, and he must take these concerns seriously. If he does not intervene, I would be astonished if the Surrey police authority is able to set a precept that does not smash straight through the capping limits. If the police authority proposes something above 5 per cent. I would expect him to cap it, but I must tell him that he would then have to meet the chief constable, the chairman of the police authority and hon. Members who represent Surrey constituencies to explain how he will address the problem centrally. Without a shadow of doubt, Surrey has a completely solid case, given the consequences of how the funding formulae have rolled out over the past 10 years.