Vital that we plug gaps in funding

In my previous two blogs I have written about the financial challenges we are facing as a
council.

Challenges we are facing due to our Revenue Support Grant – the main government grant
we receive to support a range of council services – being dramatically cut. In 2013/14 we
received a grant of £55million and this will have reduced to just £10million by 2019/20 – a cut
of £45million over six years.

When you consider it now costs the council £46million every year to provide adult social care
to the elderly and those with disabilities in our city – a figure which will only rise further – it’s
easy to see the size of the challenge.

Austerity has been in place since the turn of the decade and I believe the council has now
reached the stage where we are no longer sufficiently funded to provide the services we
need to deliver for residents. As I’ve said previously, we need a fair funding deal from
government.

I wholeheartedly agree with the editor of the Peterborough Telegraph who said last week
that councils also need to generate income to protect services and to operate more and
more like a business.

Recently there was a debate at Council about loaning money to the developer who’ll build
the Fletton Quays hotel. This will not only accelerate the completion of Fletton Quays but it
also generates income; income which is then used to plug the gap caused by years of cuts
to our funding by government.

Artist's impression of hotel

We are able to borrow money at a lower interest rate, because we’re a council, than the
developer can on the open market. We then loan the money to the developer at a higher
rate of interest to what we borrowed it at, and then after two years the developer pays back
the loan with a six-figure sum of interest. It’s then the profit from this interest which we can
re-invest into council services, such as providing social care support to elderly people in their
own homes.

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City needs a fair deal

In last week’s column I said I believed Peterborough does not receive a fair funding deal from government and our residents are being short-changed.

It was, in effect, a proverbial drawing of the line in the sand. This is because we’ve reached the stage where we are no longer sufficiently funded to provide the services we need to deliver for residents.

I made a commitment to campaign to government for fairer funding and I have wasted no time in trying to get our voice heard.

I’ve contacted the chairman of the Local Government Association, Lord Porter, our MPs, Shailesh Vara and Fiona Onasanya and mayor of the new combined authority, James Palmer, to discuss how they can all help our fight. I’m also looking to speak to other unitary authorities who have campaigned for fairer funding, so that we can benefit from strength in numbers.

It’s still early days, but this is just the start of what I intend to be a long-running campaign to get our voice heard and for this to be reflected in our funding from government.

It won’t be an easy task, a realisation I had this week when I learnt the Department for Communities and Local Government’s response to my call for additional funding was to say that our core spending power will increase between now and 2019/20.

That might be the case (although it does fall slightly next year), but we don’t believe that core spending power is a proper measure of whether we are funded adequately by the government. That’s because core spending power does not simply reflect the amount the government gives us in grants but includes a number of elements such as council tax income which is paid for by residents.

The fact is that between 2013/14 and 2019/20 our central grant from government will have fallen by 80 per cent.

Our funding does not take into account rises in population or the substantial increases in demand on our services. Demand that has seen a 200 per cent rise in the number of homeless families requiring temporary accommodation in just the past two years.

We are not the only council to be speaking out and the numbers are growing for fairer funding from government.

But the challenge for our 2018/19 budget still exists. We’re constantly striving to fill the gap in our budget that grows year on year by, for example, developing new ways of generating income and continuing to promote the city to businesses so that we can benefit from additional business rates income.

Attracting new businesses is one area we have real success in. Only this week supermarket giant Lidl announced it will be creating 500 jobs in the city by building their largest UK distribution centre here.

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Peterborough matters and we need to fight for fairer funding

One of the questions I often get asked is whether the cuts to our government funding have impacted our ability to provide services as severely as some other councils are reporting.

I think that might be because in Peterborough we’ve minimised reductions in services and increases in council tax for residents while still investing in the city and consistently balancing our budget.

The truth is that it differs for every council, with some areas affected worse than others.

I would argue that in Peterborough we are one of the worst affected areas, with our funding from government failing to take into account unprecedented increases in demand or population growth – our funding is simply cut year after year.

Between 2013/14 and 2019/20 our Revenue Support Grant – the main government grant we receive to support a range of services delivered by the council – will have been reduced by 80 per cent.

Graph showing reduction in funding

What would you do if the wages coming into your household reduced by 80 per cent? You could cut out the luxury items, meals out and new clothes, but how would you still pay for all those essential items such as heating, water and food?

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Keep fit and help good causes

This Sunday the city will be packed with people hoping to achieve a personal best in this year’s Perkins Great Eastern Run.

This annual event is a highlight in the city’s calendar and one which attracts more and more people each year since its return in 2006.

Running has grown in popularity over recent years, partly thanks to the sporting achievements of Mo Farah and the rest of Team GB in the London and Rio Olympic Games.

However, I think it’s also down to the freedom it offers and its ability to fit easily into our modern lives.

Running (and walking, my personal favourite) are the few forms of exercise that can be done alone and in almost any environment. You don’t need any expensive equipment, you just put on your shoes and go.

The health benefits of regular exercise and getting out into the fresh air are undeniable and we all know we should be doing a lot more of it.

So with that in mind, I’ve got two messages for you ahead of this Sunday’s race event.

Firstly, I’d like to wish everyone participating in the half marathon and the Anna’s Hope 5km Fun Run an enjoyable and successful day.

And secondly, I’d like to invite everyone reading this column to make time this weekend for a 30 minutes walk or run. If you want to tie it in with watching the Perkins Great Eastern Run in action, you can find the route on the PGER website. However, one of the best locations to watch the runners pass is Cathedral Square.

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