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Stop the growing divide in Britain

Autumn StatementIn 2010, the new Chancellor George Osborne promised “We were all in it together”, however, in the last three years we have seen the largest cuts targeted towards the North East.

It is a line he was unlikely to repeat during today’s Autumn statement. Three years in and he has missed every economic target he set himself; we have had a double dip recession, a credit rating downgrade, and he has missed his deficit reduction targets, promising to extend austerity beyond this parliament.

The Chancellor may condemn Labour for what he inherited but ignores three fundamental facts:

  1. The global economic crisis in 2008, which hit every developed nation
  2. The Conservatives promised to match the Labour Government’s spending plans in opposition
  3. The Coalition Government inherited four consecutive quarters of growth, before austerity returned us to recession

We all welcome the return to growth, but the slowest economic recovery in over a century is not a record of success for the Chancellor. In total during thirteen years of a Labour Government, there was negative growth on five occasions, all of which occurred during the financial crisis. In comparison, the Coalition has delivered negative growth on four occasions in the last three years, and the economy is to yet return to its pre-economic crisis level. However, it is how the Government translate their economic performance into policy which is exacerbating a growing North South divide.

In his first budget, George Osborne promised to “protect the most vulnerable in society”. However, cuts to Local Government have been disproportionately targeted towards the North East. New research by SIGOMA (Special Interest Group of Municipal Authorities) found that local government spending plans will result in the average council in the North East losing £665 per person compared to those in the South East, where councils only lose £305 per person by 2017/18.

Changes to funding structures and welfare reform means that the councils suffering the largest cuts are also those that often face the highest costs. The Coalition Government has moved away from funding councils according to what local people need. For example, both the Council Tax Freeze Grant and New Homes Bonus have been funded through top slicing the needs-based revenue grants and the data clearly shows that both grants are moving money away from those most in need.

SIGOMA have warned that the large number of changes mean the same councils are being hit again and again with funding cuts. Following years of disproportionate funding cuts, the significant savings made so far, and the rising cost of adult social care, councils are warning that further cuts will leave some services at breaking point.

I had hoped the Chancellor would use the Autumn statement to support those most in need and protect frontline services in the most deprived communities. We need a return to the link between funding and need, a focus on reducing inequality, and a review of all the cuts that have occurred to date and are having a disproportionate impact on the poorest communities.

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