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News round-up 12/2: Cable battles Osborne over spending cuts

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Your daily media round up of all the key stories affecting local government

Spending review

The Financial Times says business secretary Vince Cable has “escalated political tensions” in the row over the spending review by telling the paper that investment in innovation, skills, science and business support cannot be cut. The paper says Mr Cable is battling with chancellor George Osborne over the Treasury’s refusal to increase borrowing for capital spending and instead focus on switching funding from revenue spending.


Newcastle City Council

The Guardian reports that deputy Labour leader Harriet Harman has intervened to stop Newcastle City Council from axing its arts and culture budget. In an interview with the newspaper, Ms Harman said she had spoken to council leader Nick Forbes (Lab) and a proposal from the council to cut the culture and arts budget by 100% would not go ahead.


Regional Growth Fund

The number of companies walking away from the Regional Growth Fund has nearly doubled since the autumn, the Times reports. Business minister Michael Fallon admitted yesterday that the number of winning bids for state funding that have been withdrawn now totals 45, up from the 24 reported in September. A sizeable portion of the growing stash of undistributed cash has also been diverted to set up a rescue fund – dubbed the Exceptional Regional Growth Fund, or eRGF – worth as much as £100m, to prop up ailing companies.



Only seven of the 576 major building projects in the Government’s much-trumpeted national infrastructure plan have been completed, according to Labour party analysis of Treasury figures. The Independent reports that only 1% of the schemes are operational and just 18% are said to have “started” or to be “under construction” and the paper says the figures will fuel demands from Liberal Democrat ministers for the Coalition to do more to kick-start the economy.

Meanwhile, EDF Energy has asked the Treasury to guarantee some of the costs of the new nuclear reactors it will build at Hinkley Point in Somerset. The Financial Times describes the request as “controversial” given the government’s pledge not to provide public subsidies for the nuclear industry.


Social care

Experts have predicted families will end up paying double the £75,000 cap on care home fees before the government steps in to help, the Times reports. Chris Horlick, managing director at Partnership, an equity-release specialist, said the personal-care element of care costs that the cap related to, generally made up just a third of overall care costs, with hotel costs or general living expenses not covered. In addition, local authorities will make an estimate of what they believe is an appropriate cost for personal care, rather than accepting what a care home is actually charging.

Meanwhile, the Guardian reports that health secretary Jeremy Hunt has been accused of an “unambitious” approach to social care reform after announcing a £75,000 cap on care costs. It says figures from the thinktank Demos show 37% of over-65s would have benefited from the £35,000 cap proposed by the Dilnot Commisson report on care funding – but just 16% will benefit from the £75,000 cap, meaning that 120,000 people effectively lose out on support. Writing in the newspaper, columnist Polly Toynbee accuses Mr Hunt of “smoke and mirrors”.


Francis report

Nine more hospitals will be investigated over “worrying mortality rates”, the Daily Telegraph reports, bringing up the total number to face extra scrutiny as a result of last week’s Francis report up to 14.


Gypsies and Travellers

A council that spent more than £7m clearing the Dale Farm travellers’ site has given permission for a new site “just 800 metres down the road”, the Daily Telegraph reports. It says Basildon council has approved a plan for 15 double caravan pitches on government-owned land.


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Readers' comments (1)

  • It is obvious that Micawber Osborne fixed the cap and associated terms and conditions. BBC's Mark Easton has calculated only 4% of pensioners will benefit from this new support. Hunt is clearly a weak SoS so God help the NHS.

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