Corbyn attacks ‘Orwellian’ Fair Funding Review

Labour leader Jeremy Corbyn this week chose local government funding as the central focus of Prime Ministers Questions, describing the Fair Funding Review as an Orwellian phrase.

Local government organisations have voiced concerns that poor areas of the country will lose out under government proposals to remove deprivation as a factor in calculating the foundation formula for grants to councils.

Speaking in the Commons on Wednesday, Corbyn said that the Fair Funding Review proposals are likely to make things worse for struggling local authorities.

He said: “Tory proposals on the new funding formula for councils will make poorer areas even poorer.

“They are removing the word ‘deprivation’ from the funding criteria.

“In a phrase that George Orwell would have been very proud of, they have called this the fairer funding formula.”

However, May hit back, saying: “No, that is not what we are doing.

“What we are doing is ensuring that we have a fairer funding formula across local authorities.

“We are also ensuring that we are making more money available for local authorities to spend.”

However, Corbyn pointed to concerns raised by local authority representatives over the removal of the deprivation factor.

He said: “The Society of Local Authority Chief Executives has called the fairer funding formula decision ‘perverse’.

“Even before this new formula kicks in, councils are losing out now.

“A Conservative council leader said earlier this year: ‘We are really, really short of money…I mean there is no money.’”

Publication of the review proposals sparked an angry response from urban councils, which said they would be hit by the removal of the current deprivation measure.

And in February, even the County Councils Network (CCN) , whose members are set to benefit from the move, said: “Considering recent debate within the sector on deprivation we recognise that the government may wish to consider whether deprivation should be included…”

However, the CCN it said that this should only be done at a small weighting, if its inclusion was supported by evidence, and did not compromise the review’s principles of simplifying the system.

Paul Carter, chairman of the CCN, said: “…if we are to see this review through – and if we are to grasp this opportunity – compromise and pragmatism on all sides of the local government sector, will be necessary.”

A response to the consultation by the Institute for Fiscal Studies said that the MHCLG’s proposal to base the foundation formula on population alone “is weak”.

It said: “The statistical results cited by the MHCLG are not strong enough to support such a decision.”

In another attack during PMQs, Corbyn claimed that households living in Labour council area pay on average £350 less council tax than those living in ​Tory areas.

He said: “The average council tax per dwelling in Labour council areas is £1,169 compared to £1,520 in Tory council areas.”

But the prime minister said that councils have seen real terms increases in spending power and have been given more flexibility.

She said: “For example, they have called for a long time to have the borrowing cap lifted so that they could build more homes, and we have done exactly that — listened to councils and given them what they wanted.”