Newcastle heat maps illustrate funding inequality

Inner city councils are still suffering the biggest cuts in central government funding, according to new research seen by Room151.
Newcastle City Council this week released a series of heat maps showing relative cuts in spending power for councils across the country between 2010/11 and 2015/16.
The original source document containing the maps shows that London Borough of Hackney and Metropolitan Borough of Knowsley both face cuts in spending power of 27% with Newcastle set for a 19% drop. These figures compare to a rise of 1% in the Home Counties councils of Surrey and Wokingham.

The document, supplied as evidence to the Public Accounts Committee said: “It is realistic to expect that cuts in funding will have a greater impact on the cuts in spending power for areas that are most dependent on grant funding, because they had a larger spending power to start with to meet what was recognized as a difference in spending needed to deliver statutory services.
“However, a major concern is why councils should see such a variation in the percentage change in their spending power in 2014/15 and 2015/16 and why this should continue in future years, given the burden of cuts that these council have already had to face between 2010/11 and 2013/14.”

The data shows the average amount of spending power per dwelling in England will drop by £300m over the period.
However, it also reveals acute regional variations, with an average drop of £467 in the North East, compared to just £46 in the South East.
The figures, compiled from data published by the Department of Communities and Local Government, shows the 10% most deprived councils face a drop of 5.3% in spending power to 2015/16, compared to a rise of 1.5% for the most wealthy decile.

In addition, the document raises concerns over the equity of New Homes Bonus calculations, which see deprived councils much harder hit by the top-slicing of grant used to pay for much of the scheme.
Shockingly, although Birmingham was a top performer, illustrative figures show that its £19.9m award would be more than wiped out by a top-slice debit of £29.7m – a net loss of £9.8m.
In contrast, London Borough of Richmond on Thames only earnt an indicative £2.8m for the year, but would only lose £1.9m through topslicing – a net gain of £0.9m for building far fewer houses than Birmingham.
Newcastle’s leader Nick Forbes called for a fairer allocation of money to councils based on the level of need.

This week, the archbishops of Canterbury and York warned that politicians claiming that economic growth is the answer to social problems were selling a “lie”.
They said that Britain is a country where the poor are being left behind, and entire cities “cast aside” because of an obsession with Middle England.

Image (cropped) by smlp.co.uk