David Simmonds
MP for Ruislip, Northwood and Pinner · Conservative · United Kingdom
“I welcome the Secretary of State back to the Dispatch Box, and I thank her for early sight of her statement. I am not sure that this was the triumphant return to the subject of devolution that she had in mind, because our councillors and the communities that they represent are looking aghast at yet another shambolic U-turn from this Gover…”
“Given that the Government have been banking on millions of pounds in savings—we have challenged them on those savings repeatedly across the Dispatch Boxes—to mitigate costs, which include the massive rise in national insurance that has driven many councils to the verge of bankruptcy, what assessment have Treasury colleagues made, and what…”
“Given the promises made and that all our political parties have selected candidates who have been campaigning for mayoral elections and new unitary authorities that the Government promised were coming into being, with elections to take place next May, will she give a categorical assurance that those new authorities will be in place, or pr…”
“Can she tell the House from the Dispatch Box why she is not satisfied that it was lawful, and will she place all the non-privileged documentation and correspondence relating to this debacle in the public domain and in the Library?”
“Finally, I appreciate that the Secretary of State has returned to the role after others have been stewarding it, but will she apologise to all those councillors, all those local government officials, all those political candidates and activists and all those businesses who have engaged in good faith with the Government’s process?”
“Planning permissions for new homes, of which there are already around 1.5 million, are one thing, but getting those units built is another. With Savills reporting that two thirds of London boroughs have seen net zero new housing starts under the Mayor of London, what proposals do the Government have to ensure that units with permission ac…”
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“My right hon. Friend is absolutely correct. When Ministers talk about additional resources being provided to local government, we need to reflect on the fact that two thirds of the funding in this settlement comes from the maximum possible council tax rise across the country, and a large chunk of the rest comes from a huge rise in business rates.”
“They report that they have been left £60 million a year short. Members will be ill-served by the consequences of the Budget.”
“Madam Deputy Speaker, I am sure that you will be pleased to know that that prompts me to move on to the next part of what we need to say. Let us recall for those who cry austerity at Conservative Members that the last Labour Government spent on average 10% more in every year of its final decade in office than they raised in taxes, which left a colossal legacy of debt that we have scarcely begun to repay. Millions were squandered on projects such as building schools for the future that were cancelled at the tail end of the last Labour Government by Alistair Darling, as they ran out of money. When we look at the reports of what this means at constituency level, councils such as Surrey, which embraced this Labour Government’s devolution agenda, have now lost the opportunity for the mayor that they were promised.”
“One of my tasks in the world of local government was to engage with that last Labour Government and the disastrous consequences of their overspending. They were completely clear with authorities such as mine that stopped work on BSF that they did not have the money to see through the promises that they were making to the public. We were told that by the Department for Education. I am very confident that my constituents understand the consequences that a Labour Government have on their politics.”
“I appreciate that he knows rather more about Camden council than he does about Hillingdon council, but let us reflect a little further on the history. Our constituents last had a Labour council in 1998. I went to that budget meeting at which our constituents were faced with an 18.7% council tax rise—£60 million of unfunded efficiency savings by a Labour council. I think they understand where their political priorities lie and who has their interests at heart.”
“I will make a little progress, because I know that Madam Deputy Speaker will want others to have time. History is repeating itself. Let us not forget that this is a statement that leaves two thirds of councils in England worse off, from the analysis that has been done by the Local Government Association. That piles additional costs on top of things such as last year’s national insurance contributions rise, which left councils £1.5 billion net worse off. This settlement tightens ringfencing, removing the ability of local leaders to deploy homelessness funding flexibly to meet local needs, for example. It also comes at a time when this botched reorganisation of local government has created chaos across the sector, with a hokey-cokey of elections promised and then cancelled, sometimes within 24 hours, from that Dispatch Box.”
“Buy one, get one free campaigns intended to reduce obesity in the public health environment have a 50% reduction. Even Awaab’s law, which was championed at the Dispatch Box just a short time ago by the Minister for Housing and Planning sees a cut of £26,000 from its paltry beginnings. Perhaps the Secretary of State will reflect that what he is announcing is essentially a massive shift of funding away from the statutory duties and obligations that this Parliament has placed on our local authorities to those favoured political areas that the Government see as their priorities for the future.”
“One of the most striking things about this settlement is that the Secretary of State has come to the Chamber and said that the key priority for this Government is addressing poverty and deprivation. Poverty and deprivation do not feature in this local government funding settlement. They are not part of this formula that the Secretary of State is asking us to agree. What is striking is the things that he says are important. He talked about vulnerable children in education, but it is cash flat, same as last year. Virtual schools are cash flat. The revenue support grant for local authorities is cash flat. Personal advisers to care leavers are cash flat. Money for supporting local authorities with social care, which was specifically described as a priority, is cash flat.”
“That comes at a time when thousands of voters are being denied a say by this Government through the cancelling of elections. That situation is caused solely by the Secretary of State’s abject failure to deliver the Government’s devolution plans to the proposed timetable. It is one thing to cancel elections in a council that is about to be abolished, so that voters can instead choose its replacement. It is very much another thing to defer elections indefinitely while we wait for the Secretary of State to get his act together. Our councils and our communities deserve a better settlement than this. I will conclude with some points that I hope the Minister will address in the summing up.”
“It means price rises for consumers, fuelling inflation. The rise is a barrier to investments in our high streets, and that situation is replicated across the country. Let us not forget that under the previous Government—this is one of the things of which we are most proud—an average of 800 new jobs were created every single day we were in office. Let us never cease to remind those on the Government Benches that unemployment has risen in every single month of this Labour Government. They are a Government who clearly do not respect our local colleagues. They refer to leaders as mere community convenors. They seek to reduce our councillors’ level of discretion. They create uncertainty through a lack of clarity on reorganisation, on special educational needs and disabilities deficits and on whether mayoral elections are going ahead.”
“My hon. Friend draws attention to another significant issue facing local authorities: the level of uncertainty. Money has been promised, then withdrawn. Budgets have been allocated, then reduced. In that context, I am sure that her constituents will be as concerned as I am that so much of this money is simply built into massive tax rises across the country. I will turn briefly to business rates. We know, including from the question that the hon. Member for Stourbridge (Cat Eccles) asked at Prime Minister’s questions, the pressure being felt acutely on our high streets, especially in hospitality and retail. A business owner in my constituency told me yesterday that across his food franchise, the business rates rise alone is an additional £100,000 a year. That is a lot of entry level jobs at risk.”
“I just want to ask the hon. Gentleman whether he agrees with the Labour leader of Sheffield council, who says: “Cost pressures continue to outstrip increases in funding, both specific inflationary pressures in major service areas, particularly for care, accommodation and construction, and the increasing volume of demand in housing and care.” Is the Labour leader in Sheffield correct?”
“What is clear in this settlement is that the Government are not meeting even their own standards on local government. Local democracy is paying the price, with elections cancelled and taxes relentlessly rising. This statement must be seen for what it is: it is a council tax bombshell; it is a business rates bombshell; it is part of a picture of a Labour Government who simply cannot manage the money.”
“The impact of the relentless rises in national insurance contributions and business rates, as well as an additional £750 million of costs to local authorities from changes to the emissions trading scheme, will put huge pressure on the ability of local authorities to deliver. It having been said that the Secretary of State wanted to move away from a bidding process, we now hear that the funding that has been announced, without any detail, for special educational needs deficits will be the subject of a bidding process to the Department for Education, and there will be a requirement for a reform plan. It will be interesting to hear how that plan differs from the safety valve agreements that many authorities already have in place, which are reducing SEND deficits year on year.”
“We know from the recent report by Savills that 23 of London’s 33 boroughs report that the net figure for new homes being commenced this quarter is zero. Lambeth council has been very public about that, and has reported net zero new social homes. The Secretary of State and the Chair of the Housing, Communities and Local Government Committee, the hon. Member for Vauxhall and Camberwell Green (Florence Eshalomi), are particularly familiar with that. It is clear that housing delivery is collapsing at a time when lofty ambitions are being set, and at a time when the grants for homelessness are cash-flat, as are care costs, and costs relating to vulnerable children and care leavers. It is clear that for all the bluster, the smoke is clearing, and the mirror is not particularly shiny.”
“One of them is on the report on local government finance, and the other is on the report on the referendum limit. I am sure that we have all noted the complete absence of any Reform Members in the Chamber. I pay tribute to the champions of Worcestershire, my hon. Friends the Members for Bromsgrove (Bradley Thomas) and for Wyre Forest (Mark Garnier), who spoke up for residents against an authority that, having been part of a party that promised no rises in council tax and cuts in office, is now looking to top the league table with the largest council tax rises in the country this year. It should be ashamed of its misinformation to residents during election campaigns. Let me mention some of the things that I hope the Minister will address in her summing up. The first is what the measures in the report do to support housing delivery.”
“I am grateful to the Minister for the interest that she has shown, for example, in the way that the local growth fund—the method of distribution of which is having a huge impact, particularly on colleagues in Northern Ireland—offers scope for some adjustment. However, it is very clear that the recovery grant that the Secretary of State spoke about still bears little or no relation to the pressures arising from the statutory duties on local authorities. As we have heard from Member from across the House, it leaves councils tens of millions of pounds short of the money that they need to do the minimum required of them by this Government, and that is before addressing some of the broader, more general issues. We have two motions before us.”
“The Prime Minister said that there would be no tax rises on working people. I imagine that the working people who are about to receive a £500-a-year increase in their council tax, the working people in Westminster expecting an 82% rise in their council tax, and those in Wandsworth expecting an 87% rise in their council tax as a result of this settlement will wonder if “working people” was a phrase that applied to them. Those in our business community who heard the Prime Minister say to them that a Labour Government would introduce “permanently lower business rates” will wonder where the massive rise in their business rates bill has come from. There are things in the reports before us that give us the opportunity to make tweaks and changes, and make progress.”
“Our residents, hearing a message from the Labour Government that there is more money in the system, find that money is coming straight out of their pockets and wallets, through massive increases in council tax. We need a fundamental rethink about how we deliver local government in the capital, so that it is affordable, deliverable and sustainable for the future.”
“The leaders of inner-London boroughs—Labour and Conservative—talk of acute pressures getting much worse much faster than they had expected, and shortfalls in this funding settlement so excessive that no level of cuts could lead to boroughs achieving them and meeting their statutory duties. When she speaks on the local government finance settlement tomorrow, will the Minister announce a more fundamental rethink? Local authorities have a huge range of statutory duties, with more than 800 different services delivered by a typical local authority. The rise in national insurance alone has significantly driven up the cost of those activities. We do not simply need more sticking plasters.”
“Earlier, I met with one of the Conservative councillors from the London borough of Barnet, traditionally one of the less affected outer London boroughs, who reported that a £200 million funding gap is opening up as a result of the changes that this Government are making. Even for those of us in outer London boroughs, where council tax rates are broadly similar to those in the surrounding county and district areas, the combination of the rises in the mayoral precept, referred to by my hon. Friend the Member for Bromley and Biggin Hill, and those acute pressures, mean that in many cases council tax will already be at or well in excess of the £2,000 benchmark that Ministers have set out for council tax across the country. In conclusion, we see a consistent message from across the sector.”
“It will address the significant long-term structural and demographic concern driven by the increasing numbers of children with more acute needs for whom local authorities have a statutory duty—another duty over which they have no discretion. Although the statutory accounting override—to which Ministers have referred in the past—goes some way to avoiding that becoming an acute problem, we see acute pressure building up across the country, not just in inner London. All that amounts to a situation where residents in inner London face extraordinarily significant increases in their taxes. The royal borough of Kensington and Chelsea has reported potential increases of council tax of up to £500 a year.”
“Members from throughout the Chamber talk about the acute pressure from housing need, at a time when housing delivery in the capital has absolutely collapsed, demonstrates that things are not going in the right direction. We are due to consider the local government finance settlement in the main Chamber tomorrow. More two thirds of local authorities have reported, having crunched the numbers on that funding formula, that they will be left worse off under it. Two thirds of councils in the country are worse off under the funding settlement being introduced by this Labour Government. There is another significant factor. This week we heard that the SEND White Paper is to be delayed further.”
“That contributes to the sharply rising pressure on temporary accommodation that London Councils, on behalf of the capital’s local authorities, has highlighted as the biggest single factor driving inner-London councils to seek exceptional financial support and to look at significant reductions across the capital in the services that our constituents expect local authorities to provide, such as libraries, parks and clean streets. At the same time, according to a recent report by Savills, two thirds of London boroughs report reaching net zero: not net zero in the traditional sense of an environmental target, but net zero new housing starts. In two thirds of our capital’s boroughs, no new homes are being added to the housing stock at a time when the Government have an increasingly unattainable target of 1.5 million new homes. To hear hon.”
“Acute pressure has been created by an explosion in rough sleeping and homelessness in inner London since this Government took office. We need to be clear: London has always had a challenge around rough sleeping. Although my constituency does not cover Heathrow, it is a significant factor in my local authority’s activities. The number of people who find their way to an airport that is open 24/7, with showers, toilets and security, means that there are a disproportionately large number of rough sleepers in my local authority’s area. As we heard, there has been a 27% increase in street homelessness since this Government took office.”
“It is essentially a measure to allow a council to borrow to get it through temporary financial difficulties. It is a way of avoiding the issuance of a section 114 notice, which is the equivalent of a bankruptcy notice, by the statutory finance officers in that local authority. On an almost weekly basis, this Government make written ministerial statements on local government best value interventions, and on agreeing exceptional financial support to the extent that it is no longer exceptional. It is clearly simply a method of sustaining local authorities to avoid bad headlines, rather than addressing the nature, scope and purpose of statutory duties, which need to be addressed to get budgets back into balance.”
“The consistent feedback from councillors across London is that they feel a sense of shock and surprise at just how fast things have got so much worse. There are also particular significant dynamics in inner London. As several hon. Members have said, in the local government finance settlement, more than two thirds of the additional resources announced by the Government would come from the maximum possible council tax rise being imposed across the board. That is not additional Government funding, it is simply councils being required, as a minimum, to use their maximum possible tax-raising powers on the household budgets of all their local residents. We also see the impacts of exceptional financial support, a policy that has existed under Governments of all stripes under different names for a long time.”
“To address the longer-term funding issues, however, the Government clearly need to address the nature, scope and purpose of many of the statutory duties that exist across all those authorities, in order to enable us all to live within our means and to set levels of taxation that are reasonable for our constituents to pay. Sadly, we are not seeing that happening. Instead, as the hon. Member for Sutton and Cheam (Luke Taylor) described, we have a Government who came to office saying that they were the cavalry coming over the hill, and that they could be trusted to inject additional resources into inner London, outer London and other parts of the country that were concerned about funding. In their first Budget, however, local government was left £1.5 billion net worse off through the jobs tax—the national insurance rise—alone.”
“We know that London’s funding formula has always, to an extent, created a city of two halves. There are the inner-London boroughs, with a relatively generous settlement from that funding formula and, historically, generally lower council taxes. Then there is a doughnut of outer-London boroughs, in which my constituency and that of my hon. Friend the Member for Bromley and Biggin Hill (Peter Fortune) are found, with a funding level broadly in line with the surrounding county and district authorities. For a long time, it has been a source of concern among London authorities that there needs to be some levelling out to ensure consistency across council tax and funding.”
“It is a pleasure to serve under your chairmanship, Dr Murrison. I draw hon. Members’ attention to my entry in the Register of Members’ Financial Interests. I am a parliamentary vice-president of London Councils and a vice-president of the Local Government Association. I would like to thank those organisations for the excellent research that they have supplied to Members to help us prepare for today’s debate. While I congratulate the hon. Member for Dulwich and West Norwood (Helen Hayes) on securing the debate, listening to her story of being a councillor—one that is reflected, I think, by a good number of Members who were present this afternoon—made me think about where it sits in the context of what is happening with the local government funding formula overall and the particular impact that it is having on our inner-London boroughs.”
“My constituents are concerned about the imminent closure of volunteer-manned Pinner police station, as part of a programme of closure by the Mayor of London that leaves the whole London borough of Harrow with no in-person access to the police. Thus far, the volunteers who man the front desk and I have had no response at all from the Mayor of London to our attempts to raise this issue. Will the Minister intervene to ensure that we at least get a response, and that the Mayor of London listens to my constituents’ concerns?”
“Will my hon. Friend reflect on the view, which I hear a good deal in a constituency, which contains very many entrepreneurs both of Indian heritage and with connections to business in India, that this deal shows a Government who are not listening to the voice of business that has that level of experience, because they are missing out, as he is describing, on so many of the opportunities that those existing business links contain.”
“My hon. Friend will recall that during the debates about post-Brexit trade agreements, the highest possible standards of animal welfare were raised frequently across the House on a cross-party basis. The matter my hon. Friend is talking about involves swapping prawns and other types of seafood caught in British waters to the highest possible standards with creatures reared using a method that involves pulling off their eyeballs while they are alive in order for them to lay more eggs so that more prawns can be produced more cheaply. I am sure we would all agree that is cruel and would not meet the expectations set out across the House. Does my hon. Friend agree that it is a powerful point that illustrates the asymmetry in this deal, which he is quite rightly seeking to criticise?”
“With those observations, which are largely about the process for reorganisation in these individual circumstances—as opposed to the principle, which we very much support—I close for the Opposition.”
“I appreciate that nothing in the draft order, of itself, will change the status of that debt as something owned by Warrington council, but the arrival into this combined authority of one council with such a comparatively large level of debt raises questions. The first question is whether there is a risk that the mayoral precept is effectively bailing out the debt of one of those authorities. Alternatively, given that Warrington will be required to contribute financially, will it be able to raise the necessary funds through its own arrangements, since it has envoys in place whose job is essentially to manage down that debt pile, which is extremely large compared with the overall turnover of the authority?”
“It would be helpful for the Committee to know what assumptions, if any, the Ministry or other parts of Government have made about the level of the precept, and where that sits against other sources of funding, some of which the Chancellor has referred to, to underpin other elements of public transport investment. To what extent is it an additional levy being funded through a mayoral precept versus what is coming from central Government resources, as has been announced so far? Finally, I have two questions specifically on Warrington. Members across the Committee will be aware that the Minister’s predecessor sent envoys into Warrington council last summer—it is an authority with a debt of around £1.8 billion.”
“The authorities in question all have multiple statutory functions—they provide children’s services, adult social care and a variety of different services—but the primary focus of the orders is transport. What data ringfence is drawn around those new data-control and data-sharing measures so that residents can have a degree of assurance and clarity about what is to be shared on this footprint and what is not? I also have a question about the precepts themselves. We briefly touched on the point about the 30-year mayoral investment fund; clearly, with transport as the major focus, the underlying assumption is that the mayor will use the new precept to underwrite investment in those transport functions. A great deal of debate is going on about how transport functions across the country should develop.”
“The feedback from several authorities is that the big incentive is that central Government are making a significant additional level of discretionary funding available to mayoral combined authorities. Clearly, 30 years runs over multiple future Parliaments, so it would be helpful to understand how the settlement has been reached with the Treasury, whether it means that the funding cannot disappear because of future changes in Government circumstances, and if so what the methodology has been, so that authorities entering into an agreement have a sufficient level of assurance that the funding will continue. I would like to ask the Minister about data sharing, which is one of the new functions conferred by these orders.”
“It is a pleasure to see you in the Chair, Dr Huq. I am sure you will be pleased, as will the Minister, to know from the outset that the Opposition do not intend to divide the Committee on these orders. However, I do have a few questions to put to the Minister that are relevant to both orders; where they are not, I will be more specific. The first question is about the agreement that the Minister may or may not have reached with the Treasury about the underwriting of the 30-year mayoral investment fund. One of the concerns that the Opposition have highlighted, which I know has been shared to a degree across parties, is that with the English devolution Bill there is scope, perhaps, for new mayoral authorities to raise significant precepts.”
“It is clear that that reflects a very substantial, permanently higher rate of business rates and an unwelcome U-turn by the Government. All of us can see the practical impact in our communities, and I would bet that there is not a Member in this room who has not been lobbied by local pubs, cafés and shops about the impact that this is having on their business.”
“Member for York Central (Rachael Maskell) had reported that a survey showed an average increase of 41% for hospitality businesses, 44.4% for music venues and 27% for independent shops in her constituency. The body that represents the United Kingdom’s gym and health providers, ukactive, reports an average increase of 60% in the business rates for which its members are liable. The National Pharmacy Association has reported that its members are having to remortgage their homes and put their life savings into their businesses to meet the business rate increases proposed by the Government. To date, over the last 12 months, there have been a net 200,000 job losses in the retail sector, which businesses report are primarily due to increases in business rates and national insurance contributions.”
“It is a pleasure to serve with you in the Chair, Mr Turner, for what I think is the first time. As the Minister outlined, the purpose of the draft regulations is to round off the otherwise larger increases in business rates, but it is important to put that in context. A short time ago, we had a general election, in which the Prime Minister said that there would be a new regime of “permanently lower business rates”. I appreciate that the Treasury is currently hiring a new business rates tax adviser, but this issue is not going away. In Prime Minister’s questions this afternoon, my hon. Friend the Member for Rutland and Stamford (Alicia Kearns) referred to a 2,000% increase in the business rates applying to one of the pubs in her constituency. Previously, the hon.”
“The Prime Minister said on 7 January that the Government were in talks to see “what further support and action we can take.” —[ Official Report , 7 January 2026; Vol. 778, c. 260.] That was days after he acknowledged that as a result of this settlement, pubs and hospitality, in particular, “will struggle.” The question for Opposition Members is, is this it?”
“The impact of these business rates on top of that is enormous. Thirdly, what role have the local reliefs, which were briefly touched on by the Minister and are set out in the explanatory memo, played in the determination of the funding settlement? Although the fig leaf is offered that local reliefs may be available, it is clear that the Government’s assumption is that all these increases will be implemented in full before any consideration is given to additional funding. What consideration has the Minister given to a return to the local authority business growth incentive business rates regime, which was designed to incentivise local authorities, through additional support from central Government, to look to create opportunities to support local businesses and high streets, in a way that we know was very effective?”
“First, what is the net benefit of all these measures—the increases in business rates and the transitional relief—to local councils? We know from the local government finance settlement that two thirds of local authorities in England lost net funding from central Government as a consequence. Given the substantial increase in business rates income that this would imply, what will the overall impact on local government funding be? Secondly, what assessment has the Department made of the impact that this will have on high streets and local businesses in particular? Many of those business have been lobbying us because the family business tax, the rise in national insurance and the interaction with the changes in the point at which national insurance is charged have put huge pressure on them.”
“My hon. Friend has outlined in very clear terms what any of us in this room could on behalf of our constituencies. There will be different local dynamics, but everywhere is suffering as a consequence of the increased taxes on businesses. Government Members might not wish to hear such messages from Opposition Members—and that is understandable, because this is politics—but they might listen to the hon. Member for Burton and Uttoxeter (Jacob Collier). In Prime Minister’s questions, he said that “any wins” had been “wiped out” by the increase in business rates, compared with what was proposed through transitional relief, and he reported to the House 60% and 70% rises in business rates affecting his local pubs. I will conclude with some questions for the Minister.”
“I am grateful to the Minister for addressing that point. It slightly begs the question, however, if the main purpose of these increases—we have heard about 2,000%, 60% and 27% increases for independent shops, as well as 200,000 job losses—is to raise additional business rates income, but the effect on local government finance is neutral. What on earth is the point of inflicting all that pain on the business sector if it does not put a single extra penny in the pockets of local government?”
“If this is such a good deal, why does my right hon. Friend think that one of my local authorities is having to house hundreds of Chagossians who are fleeing to the UK to escape its consequences?”
“In my past life, I spent a good deal of time working on matters affecting victims of child sex abuse and trafficking, so I have a lot of sympathy with the Government’s desire to ensure that the Bill, in its final form, is workable, but it seems there is already a serious risk of ambiguity around the accountability at the heart of the Bill. How does the Minister propose to ensure that there is effective oversight of the decision-making process about disclosure? If it is her view that it is not the heads of the intelligence services who should make that decision, can she share with the House her view on who should make that decision, so that we can be confident that there will be appropriate oversight of the disclosure process?”
“Finally, the Minister outlined, and I totally agree with him, the importance of this order for local authorities in implementing measures that support local economies and key industries in their area. Can he set out for the Committee what, if any, follow-up there is going to be? We know that in the past one of the challenges for the Government was that, although greater flexibility was introduced, the take-up or use of that flexibility was extremely limited in practice. What measures will there be to assess the impact that this order has, to ensure that it is operating in the way intended or, if not, to prompt a reconsideration or re-examination of the opportunities to take this kind of approach on a greater and more productive scale in the future?”