I apologise for returning to the subject of Eric Pickles once again, but the man just keeps generating material. This time, it’s because he believes Council spending is responsible for the deficit:
In comments that will further inflame council leaders from all parties, Pickles told Society Guardian: “Local government is a massive part of public expenditure. It has lived for years on unsustained growth, unsustainable public finance. People blame the bankers [for the country's economic woes] but I think big government is just as much to blame as the big banks.”
So, let’s see what Mr Pickles’ own department has to say on the matter, and see how much that ‘massive part of public expenditure’ is. And look, here’s a DCLG publication on local authority revenue expenditure and financing (pdf file, other information here) with the information we need for this year.
In total, local government is expected to spend around £120bn in 2010-11. I’m sure some of you are gasping in shock and horror at that amount, imagining all those horrible council fat cats being rolled around in their gold-plated wheelie bins while issuing political correctness dictats to terrified homeowners, but let’s see what the money is actually spent on. As the charts show, the four biggest pieces of local government expenditure are on education (£47bn, the majority of which comes from central government grants), social care (£21bn), police services (£12.5bn) and highways & transport (£7.7bn). Add in the fact that the £16bn of housing benefit and council tax benefit costs are also included as local expenditure, and that’s over £100bn of that initial sum. That remaining £16bn or so covers everything else Councils do across the whole country – waste collection, libraries, parks, planning services, development control and all the rest.
Almost £50bn of that cash is raised locally though domestic and business (NNDR) rates (though Councils have no say in the level of business rates, they have to collect them and then send all the money to Whitehall to be redistributed) and before you start complaining that Pickles is right and we’re living beyond our means, look at pages 15 and 16 of the report that detail the grants Councils get. These are almost all for carrying out things that central government requires Councils to do – like running schools – and almost all of those schemes listed there has quite detailed rules on what it can and can’t be spent on. For Pickles to complain that this is ‘a massive part of public expenditure’ and somehow responsible for the deficit just says to me that he doesn’t understand his brief at all.