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CURRY IN STRONG DEFENCE OF AREA COST ADJUSTMENT

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Local government minister David Curry says there is a 'strong case' for the funding allowance for the extra costs o...
Local government minister David Curry says there is a 'strong case' for the funding allowance for the extra costs of authorities in London and the south-east.

In a letter to today's Yorkshire Post (p11) Mr Curry responds to the paper's 'expose' of the implications of Area Cost Adjustment for northern authorities, which has been based on figures researched by a Oxford accountant Joe Hannigan.

Mr Curry says the paper's articles 'reflect the personal campaign of one lobbyist against one element in the grants for local authorities'.

'He is one of the two strong points of view held around the country. If you talk to authorities in London and the south-east they will point to additional costs they have to bear and complain that not all of these are taken into account.'

Responding to the Post's claim that central London authorities are apparently allowed 31% extra allowance for the costs of staff, Mr Curry continues;

'It is about the overall costs of recruiting and keeping all local authority staff, including teachers, in London and the south-east.'

'The truth is that each year, after detailed discussions with the local authorities, we set up detailed formulae that we apply rigidly, in exactly the same way to all councils.

'What we set up is the fairest and most detailed analysis that we can possibly achieve. How much more does Bradford need to spend, compared with Liverpool? Or does Liverpool need to spend more than Bradford? Ask the questions for all the other 400 or so local authorities in England.

'How would you decide,' asks Mr Curry. 'Both cities have about half a million people. Bradford has more school pupils than Liverpool but fewer elderly people. Bradford maintains more roads that Liverpool but has fewer visitors to provide for. And so on.

'We don't try to solve all these difficult questions behind closed doors in Whitehall. For much of each year we are in detailed discussions about them with the local authority associations.

'We are looking for ways of improving the assessments of how much more one local authority needs to spend compared with another. We examine closely each other's suggestions. We check the technical soundness of one another analyses.

'Do we make too generous allowance for the extra costs of authorities in London and the south-east?

'As a North Yorkshire MP, I expected the answer to be 'yes' when I became local government minister. But when I had it re-examined two years ago, I found a strong case for the allowance.

'I am now considering the latest evidence from our discussions with local authority associations. If the case for a change proves convincing, we shall make it.

'The authorities outside London and the south-east put forward evidence that the allowance should be cut by a quarter. The London authorities put forward evidence that the present allowance is well justified and that it should be increased to allow for high rents they pay on council premises.

'But one thing they do agree: the extra costs in Londonare not confined to the London weighting payments which the article treats as the benchmark.'

But The Yorkshire Post reports (p3) that North Yorkshire CC has welcomed the paper's article. 'It supported what we have been saying for at least two years,' said a council official.

And Derbyshire CC leader Martin Doughty commented last night:

'In the end the DoE makes a decision and announces it, whatever we think. Two years ago we thought ewe had agreement from the south eastern authorities to a phased reduction in their special allowances - but they went up.'

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