Biggest cash cut in capital hits ‘the poorest hardest’ - Coalition targets the most deprived boroughs, says Islington's finance chief Richard Greening

Published: 29 December 2010
by TERRY MESSENGER

LABOUR-controlled Is­lin­gton Council has been singled out by the Tory-Lib Dem government for the biggest budget reduction imposed on any local authority in London.

The Coalition reduced grants for council services in  Islington by 12 per cent – compared to only 2 per cent in Conser­vative Richmond-on-Thames.

Town Hall leaders said the settlement was proof that the cuts were different from those which would have been imposed had Labour been returned to power in May nation­ally.

The five London boroughs with biggest reductions – Islington, Haringey, Tower Hamlets, Hackney and Newham – are also the five most deprived boroughs in the capital. Islington’s Labour finance chief Councillor Richard Greening said:  “David Cameron said the cuts would be fair, but they are hitting the poorest hardest.”

The average cut in government grants to councils is just 4.4 per cent but the five most deprived London boroughs – all Labour – have each lost more than 10 per cent.

By contrast, Tory Richmond escaped with the lowest cut – just 2 per cent – followed by Havering, also Tory controlled, on 4 per cent.

The Coalition could have trimmed all boroughs’ allocations by 4.4 per cent instead of weighting the cuts in favour of wealthier, Conservative-controlled areas, argued Cllr Greening.

He said: “They have targeted the poorest areas for the biggest cuts instead of saying we are going to cut you all by the same amount, which we would have been able to cope with much better.

“I’m not saying we would have welcomed the 4 or 5 per cent and there wouldn’t have been any bad effects but you would have seen a package which was mainly efficiency savings and not the damaging cuts which we have been forced to make.”

Proposed cuts in Islington include:

• Three hundred job losses among council staff, with nearly half of those in the children’s services department.

• Reduced support for foster parents.

• Less help for vulnerable young people.

• The scrapping of council help with older people’s “shopping, laundry and cleaning”.

The ruling Labour group has approved a package of nearly 200 economy measures in a bid to balance next year’s budget following the grant reduction.

The package is due to be formally ratified on February 17 at a meeting of the full council.

The Coalition government argues that poorer boroughs will continue to receive more money per head than richer boroughs. 

Islington will get £855 per head of population next year compared with £158 in Richmond.

Islington’s Labour leader Councillor Cath­erine West said:  “Islington has a higher number of people on very low incomes and therefore it needs the higher figure. If we were as rich as Richmond we wouldn’t be complaining.”

After the 12 per cent cut in grants, Islington must reduce its budget from £305.3million to £278.5million – an 8.8 per reduction once the council tax element is taken into account.