Agenda item

Questions from Councillors - to a member of Executive Board, the Chair of a Committee and the Chair of any other City Council body


Council Tax


Councillor Jim Armstrong asked the following question of the Portfolio Holder for Finance, Resources and Commercial Services:


Could the Portfolio Holder provide a breakdown of the Council tax bandings for the 2,500 new houses built by the Council over the past four years? Therefore, is there a revenue return to the Council for Council tax against the cost of services to these properties?


Councillor Graham Chapman replied as follows:


Thank you for the question. It’s quite an interesting one. The current prediction is that by May 2019, the number of homes completed or on site to rent or buy will be 2251. In addition to the 2251 homes, there are a further 534 homes being actively progressed through planning and pre-site development on site, enabling the Council to charge council tax. A sample of the properties has been undertaken as requested in the question to establish the banding split. This has been used to provide an estimate percentage split of bandings: 85% Band A, 12% Band B and 3% Band C. Of these properties, there will be single occupiers and council tax support recipients, which affects, of course, the amount of council tax you can collect. In terms of income per dwelling it is estimated that we’ll get an aggregate £2,340,000 as a consequence.  That’s the council tax element only from the additional properties based on the bandings above. This assumes an estimate: 40% for single persons’ discounts at 25% apply. This income to the Council of £1,039 per dwelling, once you discount the discounts, provides £2,340,000 divided by 2251, that’s how you get it. In 2018/19, the City Council’s net budget is £246 million and the number of dwellings is 137,112. The cost per dwelling is therefore £1798. If you take what you get from these houses from the cost to the City Council of the average house, we are losing a net cost of £759; we actually lose money. This does not take into account the New Homes Bonus, which only last four years, but is worth £1671. So that makes it slightly more profitable, but in the long term, given that houses last for about fifty, sixty or more years, it becomes not a very important factor given your initial loss, nor does it take into account student dwellings.  As we all know we used to get compensation but the current Government has reduced it down to virtually nothing, and that is costing us £12 million a year. I just remind people of the loss from having student dwellings: council tax we are not able to collect and which we used to get compensation for and which we no longer do.


So interesting question, we lose money on new builds, we gain a bit more as a consequence of the New Homes Bonus, but it doesn’t last long, and we lose loads as a consequence of having lots of student housing. I am intrigued to know the purpose of the question.  Is it to try and illustrate that we benefit from house building, or that we lose from house building? You don’t have to answer because you are asking the questions.  Or is it that you don’t think we should be building social houses because they provide only provide Band A and we’ll make a substantial loss on them? I’ll just be very interested in the reasons, but again, you ask the questions, I give the answers.





Councillor Jim Armstrong asked the following question of the Portfolio Holder for Transport and HR:


Could the Portfolio Holder give a breakdown of how many of the Council’s Senior Management Team live within the City boundary?


Councillor Liversidge replied as follows:


Thank you Lord Mayor. When we talk about the Senior Management Team, I presume you are talking about the SLMG cohort which includes the Chief Executive, Corporate Directors, Strategic Directors and Heads of Service. There are 79 of those and 15 reside within the City.



L22/L23 Bus Service


Councillor Andrew Rule asked the following question of the Portfolio Holder for Transport and HR:


Given that the City Council’s transport team are proposing to withdraw the L22/23 service, which is the principle bus route serving Silverdale – can the Portfolio Holder confirm what specific steps will be taken to mitigate the impact this will have on the predominantly elderly population of Silverdale?


Councillor Liversidge replied as follows:


Thank you for your question. Nottingham City Council supports one of the best public transport networks outside London, we have already been discussing this. We have won awards for performance and recent investments in the tram and electric bus fleet have improved our position even further. In this context, the decision to withdraw the City Council’s support for the L22/23 service has been taken as part of the wider need for the budget savings we are having to make in the Council for 2019/20. None of these decisions have been taken lightly and we are focused on minimising any negative impact on City residents.


The decision to withdraw the L22/23 route has been taken as the majority of the route mileage is outside the City of Nottingham. With regards to Silverdale, this area will keep the L1 service that runs between Silverdale and the City. In order to keep the link between Silverdale and Clifton shops, it is recommended that the L service will be extended there on some or all of the journeys to maintain the link even without the L22/23 service. Parts of the L22/23 service may survive the withdrawal of the City Council’s support either as a commercial operation or with alternative support. Nottinghamshire County Council are aware of these proposals.





Councillor Andrew Rule asked the following question of the Leader of the Council:


Given the recent financial performance of the tram operator could the Leader confirm, whether or not, there is a plan in place to ensure continuity of provision should the operator fail in the future?


Councillor Liversidge, in the absence of Councillor Collins, replied as follows:


Tramlink Nottingham, the company contracted to operate Nottingham’s tram network has recently published its annual accounts for 2017/18 showing continued growth both in terms of passenger numbers and profitability.  During this period, annual passenger numbers increased by 8.5% to 17.8 million. There was also an increase in underlying gross operating profitability of 15% to £15.2 million.  The improving performance continued during the half year to 30 September 2018, which saw further patronage growth of 8.5% on the previous year along with an improving average service punctuality of 95%.  These facts and figures highlight the growing popularity of Nottingham’s tram network and the increasing role it plays in ensuring Nottingham benefits from world class integrated public transport which is a catalyst for economic prosperity and growth in the City.


The contractual arrangements established with Tramlink Nottingham include strong performance incentives and financial protection for the Council, including arrangements to ensure continuity of provision should Tramlink Nottingham fail to meet contractual obligations.


Government Funding


Councillor Leslie Ayoola asked the following question of the Deputy Leader of the Council:


Could the Deputy Leader share what response he has had from the Communities Secretary to his letter expressing concern about the proposals to direct grant funding to rural areas at the expense of cities?


Councillor Chapman replied as follows:


Thank you Councillor, I could have written that question myself.  The Government is changing the formula on which it allocates funding to councils. It is called the Fair Funding Formula.  I have written to the Minister about it and I have received a reply. Now, the problems with the proposed changes are complex and I’m not going to comatose you all by going into great detail, but the gist is that some services will no longer have their own formula which includes deprivation. There will therefore be more services deemed to have no deprivation weighting, and will be funded in a block on a population, instead of deprivation, basis. Many of those that do have a service weighting will have sparsity weighting, and sparsity means rural probably, despite the fact that studies show that density, and density means urban, is more costly than sparsity, and all this lot needs properly interpreting. One of the key words in the letter is simplification. Beware of the word ‘simplification’. In Big Brother/Orwell-speak, the word simplification when used by the Government means giving more money according to the number of people in an area and taking less account of their needs. It means more weight to the number of children in an area and less to the needs of those children. It suits places where children are privately educated, with less child poverty and child abuse, and where parents can afford to pay for their children’s leisure and travel costs. More money to places like Richmond. Less to places like Blackpool, because it is far easier to simplify, to count the number of children in an area than it is to assess their needs. That’s what simplification means. Simplification also means not having to calculate the concessionary fare needs of an area but pay more according to the number of elderly so you don’t have worry about use, what you have to worry about is the numbers, and they are easier to calculate. This will hit areas with low pensioner car ownership, and favour those with high ownership and you can guess what the impact on Nottingham is going to be. So that’s going to be ok isn’t it? We then go back to the meaning of sparsity and the Big Brother-speak. Sparsity will become more important. But for sparsity, as I said earlier, read ‘rural’, and for ‘rural’, read ‘County Councils’, and for ‘County Councils’, read ‘Tory’. Density will be less important. So, conversely, for ‘density’, read ‘urban’, for ‘urban’, read ‘cities’, and for ‘cities’ read ‘Labour’.


Then we get the word ‘even handed’ in the letter. For ‘even handed’, read ‘spreading the money evenly irrespective of need’. For that, read the better off getting more and the worse off getting less.


Then we have the word ‘transparent’. I am always suspicious of anybody using the word ‘transparent’ because they often mean the opposite, and it is also the case here. So for ‘transparent’, read ‘opaque’ because they will not discuss properly the reasons for the weighting and indeed ignore academic evidence-based research which says that density, i.e. urban costs, are substantially greater than rural costs, read ‘sparsity’.


And then they throw a bone at us in the letter. We are told journey times will be an factor in the transport allocation and it will contain congestion as well as distance. Well forgive me if I am underwhelmed because although people complain about congestion in Nottingham, it is nothing compared with congestion in the Thames Valley. So I suspect that we have another attempt to allocate funds down south, at the expense of the Midlands and the North.


So I will go over Fair Funding newspeak. For ‘fair’, read ‘unfair’, for ‘simple’, read ‘unjust’, ‘more sparsity’, means ‘more to Tory councils’, ‘less density’ means ‘less to Labour authorities’, ‘congestion’ means ‘more to the Thames Valley and taken from elsewhere’. Nothing means what it says in the letter. But in the end, what does it all mean in financial terms? The best analysis to date has been from SIGOMA, which is an organisation which represents urban authorities and this has applied some of the new criteria to Blackpool, and to Richmond, and to Manchester, and to North Yorkshire. In this scenario, Blackpool, probably the most needy authority in the country, loses £4 million; Richmond, one of the least needy in the country, gains £3 million; Manchester loses £20 million; and North Yorkshire gains £10 million. So on the basis of this Fair Funding, again read ‘Unfair Funding’, in fact very, very unfair funding.



Electric Vehicle Charging Points


Councillor Gul Khan asked the following question of the Portfolio Holder for Energy and Environment:


Does the Portfolio Holder for Energy and Environment welcome the £117,480 grant for electric vehicle charging points in the City and what impact do you think this will have on the City’s ambitious target to make Nottingham carbon neutral by 2028?


Councillor Longford replied as follows:


Thank you Lord Mayor and thank you to Councillor Khan for your timely question. Thanks also to the staff of Nottingham University Hospitals NHS Trust who have got me back in something like working order less than four weeks after a knee replacement operation, so I can stand here and answer this question on a subject close to my heart.


I very much welcome this additional grant for electric vehicle charging points in the City. The successful funding bid demonstrates the effectiveness of our award-winning Go Ultra Low team, who are always trying to find ways of expanding the use of electric vehicles across the City. These charge points will expand our network and give confidence to electric vehicle drivers that there are a wide-range of charging options in the City. These particular charge points are being installed in car parks in residential neighbourhoods where we know many of our citizens do not have off-street parking such as a driveway or their own garage to charge an electric vehicle, and so this is a vital step in supporting them to make the switch to cleaner vehicles.  It will also demonstrate to those people living in such areas that, even though they may not have off-street parking, they can still have places to charge a vehicle. It will allow them to take advantage of the environmental and fuel savings that electric vehicle ownership brings, whilst also benefitting the environment.


The £117,480 will be used to provide charging points at Denman Street Car Park in Radford and Park Ward, Winchester Street Car Park in Sherwood Ward, Randal Street Car Park in Arboretum Ward and Queens Walk Community Centre in Bridge Ward.  These charge points are in addition to the network of 230 that is being installed across the D2N2 area. All of these charge points are powered by renewable energy so that electric vehicle owners will be truly zero emission – both from the tailpipe and the generation of the electricity used.


Whilst the ownership of electric vehicles is currently small, their numbers are predicted to grow significantly over the next 5 – 10 years and Nottingham will be at the forefront of providing access to charging infrastructure, and by so doing, helping to promote wider uptake of zero emission and zero carbon electric cars. The impact on air quality locally and on carbon emissions makes a valuable contribution to a healthier and more sustainable environment for everyone, and will definitely make a contribution to our zero carbon goals. In this City, we know that when we talk about sustainable transport, we mainly think about mass transit on our tram and on our buses, however, we have to be realistic. There will be a place for private vehicles for the foreseeable future, and it’s much better for everyone if those vehicles are ultra-low emissions, rather than the gas-guzzlers in general use today.



Corporation Tax


Councillor Josh Cook asked the following question of the Deputy Leader of the Council/ Portfolio Holder for Finance, Resources and Commercial Services:


Does the Deputy Leader agree that the Government’s proposed £8 billion handout to big multi-national business through a 2% cut in Corporation Tax would be better spent on local government?


Councillor Chapman replied as follows:


Thank you again for another interesting question. The principle behind cutting Corporation Tax is that somehow it will encourage investment in firms and that investment will translate into higher productivity, higher turnover, more research and development, and more taxes in the long run. It’s a lovely idea. But it’s a bit like the theory behind reducing taxes for the rich, and what’s called the Laffer Curve, whereby the less tax you charge, the more you collect because the more willing they are to pay and the more they invest and more turnover they create. It is, like the Laffer Curve, a myth. Corporation Tax in Germany is just below 30%; in France it is over 30%; in the UK it is heading for, I believe, 17%. British productivity however is lower than in Germany and France; research and development investment, which underpins productivity is lower than in Germany and France; retained profits which are reinvested in the firm are lower. Conversely, payouts to shareholders in the UK are higher. So, what does this mean? It means that the more you reduce Corporation Tax, the less investment there is perversely back in the firm and the more money drains out of the firm to the shareholders, many of whom are not UK based. So reduced Corporation Tax can actually act as a conduit for funds leaving the UK and is an incentive to reduce investment, compared with higher taxes which may well incentivise retaining profit in order to avoid that tax.  This was pointed out to me by the richest man in Nottinghamshire. He said there is no incentive for him to reinvest with low Corporation Tax. If he had a higher one, he would reinvest back in the firm, if it was 30 odd percent he wouldn’t want to be paying that 30 odd percent, he would be reinvesting and what we desperately need in this country is reinvestment. And just to illustrate another aspect of the point, the Norwegian Sovereign Fund has just invested heavily in the UK, and you ask yourself; why are these generous Norwegians investing in the UK? Because they are nice people? They want to help our productivity? No it isn’t.  It’s because we are paying higher dividends than elsewhere. This is not long-term investment of money; it is short-term investment in order to benefit from higher dividend payments. In other words, they will be using their fund as a conduit to take money out of our industry and commerce and to repatriate it in Norway, and if we had done the same thing with our oil revenues, I’d be very happy, because they knew how to use theirs. Margaret Thatcher squandered ours, but’s that by the by. Corporation Tax is not the only siphon which firms use. There are lists and lists of these mechanisms: inter-firm transfers; internal recharges for royalties; tax relief on interest payments.  All ways of ensuring that some firms, and I do cite only some firms because there are some very, very good firms that don’t do this, don’t pay their fair share and that many of the benefits are leeched abroad into tax havens, and then leeched further abroad and never ever repatriated. So before we even compare the value of cuts in Corporation Tax versus spending on local government, we need to recognise that in itself, reduced Corporation Tax is counterproductive, irrespective of what you do with the proceeds. And then if you think about what it would achieve by it being reinvested, then the case is open and shut. Local Government has suffered more than any other facet of Government in the last seven to eight years.  We have been hit harder than Defence, harder even than the Police, harder than the NHS and harder than Transportation. Therefore, there is a very good justification for giving us priority. The other justification is the LGA’s calculation that in order for Local Government to close the funding gap that it’s going to have to face over the next few years, it requires £8 billion; exactly the same amount. Applied to Nottingham on the basis of population alone, and not on places of deprivation, that would give us just under £40 million, which is roughly the amount of savings we are going to find over the next two years. So in short, to answer the question, it would do very nicely thank you.



Conservative Party Publication


Councillor Mike Edwards asked the following question of the Leader of the Council:


Did the Leader see the Conservative Party’s recent publication with their commitments to Nottingham City Centre residents and to what extent does he think that those commitments are relevant and agreeable for local people?


Councillor Chapman, in the absence of Councillor Collins, replied as follows:


I’ve almost got to apologise for hogging this meeting, it’s been sort of the Chapman/Liversidge show at the moment, but I am substituting for Jon Collins who cannot be here and therefore I am going to have to answer this question as well.  So you’re going to have to put up with me for another two or three minutes.


Yes, I am aware of the leaflet because Councillor Edwards has drawn it to my attention, and as I read it, particularly the section when the unsuspecting public was asked to list their preferred Tory policies from a tick box list, I was struck by the utter lack of self-awareness there must be in the Conservative Party who have compiled the list in the first place. The first priority we are supposed to consider is, and I quote, “making a success of Brexit”. Can you believe it? Is this a priority? It makes you think that it was written in 2016, and then just pasted in in 2019.  It is so absurd, and this was in a week of further delays in votes over Brexit, a continued lack of clarity about what the Brexit proposals were, and when the Conservative Ministers managed to insult four potential post-Brexit trade partners in the space of ten days. They upset China with gunboats; they upset Japan; they upset Bangladesh; and Jeremy Hunt topped it off with some thoughtless remarks in Slovenia about the Iron Curtain. If that is success, what is failure? Don’t answer ‘Chris Grayling’, it’s too obvious.


Priority Two: cutting the deficit. I think this bit must have been cut and pasted from the 2011 manifesto because the deficit in the meantime under the Tories has gone up by substantial amounts. Massive, massive amounts. I’ve got a figure here which I don’t believe, so what I’ll do is not cite it. But I do know that it has gone up to a far greater level from what it used to be.


The journey through fantasia continues in Priority Three, which is increased house building. We have just come through a decade of the lowest house building numbers, 130,000, for any decade since the war. With the part consequence of rising homelessness we are having to deal with daily. Isn’t it interesting that one of the phenomenon you get with the Conservative Government is homelessness? You get people on the streets. The last time I remember homelessness was when Sir George Young made the wonderful remark; “the homeless are the people you step over on the way to the opera” and now we are back to where they were, and what is the one factor, what’s the common factor? It’s a Tory Government.


Priority Four: a fair benefits system to get people into work. This in a week where I have been approached on the street and in separate cases online by working people with children unable to access council housing and unable to afford private rents because of housing benefit limits. I will not mention the disasters of Universal Credit, but they talk about fair benefits system.


Priority Five: increased spending on the NHS. This is one of the few which has a modicum of reality about it. Spending has gone up, but at only 1.1% over the decade, compared with the historic average of 4%.


Priority Six: reducing immigration. Now you would have thought, given all the rhetoric about that, they would have done something about it.  Whether you think it’s right or wrong, I don’t think it’s right but nevertheless, you wouldn’t have thought under Teresa May, Home Office, buses with slogans saying “go home”, immigration was actually higher in 2018 than it was in 2010.


Protecting spending in schools.  Nationally, but specifically locally, there has been a real terms cut in per pupil spend. Nor is there any sign of recovery. In Nottingham, there is hardly a school which is not facing further cuts and to imply otherwise would be disingenuous.


Finally, even in investing in Defence, which is another one of the priorities, 2018 spend is marginally above 2010 spend, but when you adjust for inflation, it is less, it is another cut. It is misleading information.


So to follow up on my previous theme about newspeak, to any unsuspecting recipient of this piece of literature and as a guide when reading it, ‘fair’ in this literature means ‘unfair’ and when they use the word ‘increase’, it means ‘decrease’. When they use ‘decrease’, it means ‘increase’ as with personal taxation, and when they say ‘protect’, it means ‘cut’, and when they use ‘success’, as with Brexit, it means ‘failure’. So what I am going to recommend to Labour candidates for Castle Ward, is you issue a glossary of terms, and I will provide you with that glossary. Everything will mean the opposite of what they say. Thank you very much. 


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