Tight Settlement


The Labour government has given Crawley Council a grant increase of just 0.5%, £52,000, to run our services in 2009/10.  You might call this a tight settlement at 50p perCrawleyresident.  It is hardly generous by any measure when the retail price index rose by 4.2% in the year to October 2008.  This means thatCrawleyis seeing a cut of 3.7% in real terms at a time when the government is encouraging us to introduce so-called free services.  The grant increase of £52,000 will hardly contribute much to our base budget of £22.3 million.

It is true that governments of both main parties have given with one hand and taken away with another.  The current Labour government has made this approach something of an art form.  It is more subtle than past Labour governments which at one point had top-slice income tax at 83% and an investment income surcharge of 15%.  They must have thought that a combined tax rate of 98% would be motivational and good for the economy.


Labour governments since 1997 have taken a less blunt approach to taxing us more.  In their first term in office, they removed tax credits on pension fund dividends which was a betrayal for people saving for their retirement.  We also have more people paying top rate income tax because of a failure to adequately raise the tax threshold.  National Insurance has increased and will do so again.  A new top tax rate of 45% is proposed which affects a limited number of people but can still stifle the entrepreneurial spirit necessary for economic recovery.


All of this is happening while the government is borrowing heavily because of a failure to keep enough reserves for difficult times.  The borrowing is necessary despite the government taking huge sums from elsewhere including local government.


The Labour government gives councils more responsibilities without the money needed to carry them out.  This is apparent with concessionary bus travel which is significantly under funded up and down the country.  We are expecting the same to happen with river and stream maintenance and flood prevention.  These are all services that we enthusiastically provide but it would be good to have the cash.  Adding insult to injury, we are also forced to pay £13 million of our tenants’ rents to the government this year.  The money could be used to invest in homes inCrawley.


We are the victims of stealth taxation.  The Labour government tries to avoid the impression of raising direct taxation by placing the burden on local government through inadequate grant increases and general under funding.  What we have is a cynical approach to government when time and time again; people have called for openness and transparency from their politicians.  The government might imagine that people will forgive and forget but I doubt that.  You only get so many chances.



Councillor Bob Lanzer, Leader of Crawley Borough Council


16th December 2008