The banana republic of Surrey has shown local council funding is broken | Simon Jenkins

The algebra is simple. The NHS is having another terrible winter. It does not collapse, but “spills demand” on to the next line of defence, local government welfare. But while the NHS gets more money annually from the Treasury, local government gets less, some 30% less since 2011. It cannot cope with the new pressure.

The equation resolves itself into rationing, by quantity and quality: fewer care places, fewer home visits and fewer district nurses leads to more bed-blocking, fewer operations, longer trolley waits.

Tory Surrey is a responsible supplier of post-hospital care. Like all councils, it is allowed by the Treasury to increase its council tax by 5%, specifically to boost its care budget and thus ease pressure on the NHS – which the Treasury is responsible for funding. Surrey county council regarded this as nothing like enough. It therefore activated its statutory right to hold a referendum on a 15% increase.

Far from showing delight at a wealthy council accepting this burden, the Tory government was appalled. Tories do not increase taxes. The chancellor (and Surrey MP) Philip Hammond duly did what Jeremy Corbyn called a secret deal. If Surrey abandoned its referendum and the 15% hike, it could retain revenue from a different tax – the local business rate, which normally went to the Treasury. That is, the Treasury would in effect spend more on health and care in Surrey, but secretly and, so far, just for Surrey.

This is the stuff of a banana republic. If…

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