Ministers accused of 'war' on North East as funding fight begins in Westminster

The Treasury has quietly changed the way money is allocated to shift resources away from the North, according to region's leaders

Tim Ireland/PA Wire The Houses of Parliament in Westminster, central London
The Houses of Parliament in Westminster, central London

Ministers have been accused of declaring “war” on the North East as MPs and council leaders gathered at Westminster to plan their fight-back against funding cuts.

The region’s Labour politicians warned the debate about funding and grants obscured the real impact of cuts, which was worse public services and the prospect of councils running out of money.

Paul Watson, leader of Sunderland Council, said families in the North East would receive poorer police and fire services than those in wealthier parts of the country.

And the region’s politicians accused the Government of quietly scrapping the long-accepted convention that funding was allocated in part on the basis of need - so areas with higher levels of poverty, a higher proportion of older folk a low skills base or other pressing needs were given the cash they needed.

The change means a council like Newcastle is facing budget cuts while those in much wealthier areas are enjoying increases in funding.

The warnings were issued as council leaders delivered a presentation to MPs in a Commons committee room at Westminster, following a meeting with Local Government Minister Brandon Lewis.

Gateshead MP Ian Mearns told the gathering: “There is a war being fought against our communities and it is being inflicted on us in the most ruthless fashion I can remember in my 30 years in politics.”

North Durham MP Kevan Jones added: “This is a war. They know exactly what they are doing. They are diverting money from our areas to areas in the south.”

A presentation produced by the Association of North East Councils (ANEC) warned that cuts in council budgets in the North East amounted to £467 for every household between 2010 and 2016 - compared to just £105 in the South East.

The discrepancy is partly a result of the Government abandoning the principle of funding based on “need”, which traditionally meant some councils received more than others.

A higher proportion of the North East’s population is elderly than the national average. The region also has more adults who need social care and long-term unemployment, as well as more children in care, all of which would traditionally have meant councils received higher funding.

But ANEC estimates that by 2019-20, Newcastle City Council’s spending power per household will be equal to the money available to a council in a wealthy areas such as Wokingham, in Berkshire.

Meanwhile, Newcastle North MP Catherine McKinnell, has revealed that a poll of her constituents shows that more than 90% of respondents expect their standard of living to get worse or stay the same over the next three years.

The survey on her website found that 79% of respondents were concerned by energy bills, 56% by food prices and 39% with the cost of transport.

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