Conference News

Posted By: William Hobhouse
Date Posted: 22/09/2009

I am writing these notes from Bournemouth - where I am at no cost to the taxpayer!

Everyone nationally and locally is talking about the terrible state of the nation’s finances. This means council finances as well, because councils are mostly funded by Westminster. Money from Council tax only pays for about ¼ of all Council services.

Vince Cable has warned of a slash and burn attitude to cuts. He warns this means slashing services without structural change. If this approach happens in Rochdale Borough, every service will lose front line staff, and we will see slow service cuts.

There is another way, and Vince Cable is clear about what that should be:

First, the public sector wage bill should be frozen, but the salary cuts should come from the better paid.

Second, the public sector pensions must be reviewed. Each year, the cost to the council for pensions goes up and up. State subsidies of £28 billion have been mentioned. Locally that means that more and more of the £300 million council budget goes to pensions before a single service is provided. As the council’s rep on the Greater Manchester Pension Fund, I hope to write a couple of articles in about a month’s time.

Third, Rochdale Borough is a poor borough. Vince Cable has set out how it is quite wrong that ordinary pensioners along with workers on the minimum wage should pay tax, and that the tax threshold should be raised to £10,000. This will be paid for by closing some glaring tax avoidance loopholes – and having a fairer tax system where the much better off pay more.

The debate about structural change versus service cuts is a debate that must be had in Rochdale Borough too.