All my bandwidth this week has been given over to the spring budget, the moment of the year when Chancellor Jeremy Hunt tells us his plans for the economy – how he’s going to cut our taxes, or increase and set out where he’s going to spend some of our money.
But this week was a tale of two budgets: the one obsessed over in Westminster and then the budget of Birmingham Council, which has huge repercussions for the city’s one million plus population.
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I didn’t think much about the Birmingham story over the past few days as I joined the rest of the Westminster village in obsessing about whether the chancellor was going to cut national insurance or income tax, administer further public spending cuts to boost tax giveaways (and give a future Labour government a headache) or nick the opposition’s plan to abolish tax breaks for so-called wealthy “non-doms” who live in the UK with a permanent home overseas (FYI: Hunt didn’t shave more off future spending plans but they did nick Labour’s plan to scrap non-dom plan to raise £2.7bn for tax cuts).
But the dire situation of many councils across England is perhaps what is closer to the hearts of our Electoral Dysfunction listeners.
Sure the national budget matters hugely in setting the economic direction of our country and deciding on what public services with prioritise.
But local council budgets service much of our daily bread and butter: Our bin collections, childcare services, adult social care, leisure centres, parks and libraries, our carparks and road maintenance.
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Between 2010 and 2020, local government fund suffered a 40% real terms cut in grants from central government.
In December nearly one in five council bosses said they thought it “fairly or very likely” they will go bust in the next 15 months as funding fails to keep pace with inflationary costs, and rising demand for a raft of services – be in child protection or adult social care.
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And it was Hayley’s email that landed in our Electoral Dysfunction inbox that pulled my attention out of Westminster.
Hayley, who has been an officer in local government for the last 20 years, emailed in to talk about how “the last few years have been difficult”.
“In a district council setting, that I have always been incredibly proud to work in, I’m now left feeling like I might need to move on – mentally exhausted, emotionally drained,” she said.
“It’s impossible to feel like you are delivering anything meaningful because of reducing finance and increasing demand.
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Good people are leaving and the public perception is at an all low – and I have a huge amount of sympathy for that.”
She added: “I’d love to know Jess and Ruth’s view on the present state of local government, what they think the future holds – and what they think the current government’s intentions for local government are.”
It’s so pertinent this week, because this was the moment, away from Westminster, that Birmingham City Council – the city in which Electoral Dysfunction’s Jess Phillips is an MP, signed off £300m in cuts ahead of a 21% rise in council tax over two years, after declaring itself effectively bankrupt.
Financial measures described as “devastating” to people living in the city, Europe’s largest local authority could not afford to meet its financial obligations – after facing equal pay claims of up to £760m, and an £80m overspend on an under-fire IT system.
Jess, who knows the Birmingham situation all too well, talks about how councils – and this is not politically party specific – have been “massively defunded” but also says “as somebody who lives in Birmingham”, the [Labour-run] council has not been well managed.
Ruth says local government is the “bit of politics that affects people’s lives 100 per cent” and thinks the largest council in all of Europe going bust “should have been a bigger story”.
She also points out that Scotland’s local government is funded by Holyrood, where the row between central and local government over funding is very much live.
We are, says Jess, “sitting on a time bomb” with vulnerable children and adults struggling to access services now, that will only service to build up a bigger bill later.
Communities secretary Michael Gove last month announced a 6.5% increase in funding for local councils in England, but the £64bn settlement is unlikely to quell fears of a wave of de facto town hall bankruptcies, with the Local Government Association saying it was not enough to meet “severe pressures”.
The budget in Westminster did little to defuse this ticking time bomb on Wednesday.
The Institute for Government concluded in its budget wash up that the Conservative administration would “bequeath a dismal public services legacy to whoever wins the general election”, adding “it is also likely that more local authorities could issue section 114 [bankruptcy] notices, necessitating further painful cuts to services.”
Problems likely to be passed to Labour should they win the next general election.
But it’s going to get much harder for Westminster to ignore the continued problems of local government budgets if more council dominos continue to fall, especially in an election year.
Appointing Lord Mandelson as the UK’s ambassador to the US was “worth the risk”, a minister has told Sky News.
Peter Kyle said the government put the Labour peer forward for the Washington role, despite knowing he had a “strong relationship” with convicted sex offender Jeffrey Epstein.
It is this relationship that led to Peter Mandelson being fired on Thursday by the prime minister.
Image: Lord Mandelson and Jeffrey Epstein. File pic
But explaining the decision to appoint Lord Mandelson, Business Secretary Mr Kyle said: “The risk of appointing [him] knowing what was already public was worth the risk.
“Now, of course, we’ve seen the emails which were not published at the time, were not public and not even known about. And that has changed this situation.”
Speaking to Sunday Morning with Trevor Phillips, he rejected the suggestion that Lord Mandelson was appointed to Washington before security checks were completed.
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He explained there was a two-stage vetting process for Lord Mandelson before he took on the ambassador role.
The first was done by the Cabinet Office, while the second was a “political process where there were political conversations done in Number 10 about all the other aspects of an appointment”, he said.
This is an apparent reference to Sir Keir Starmer asking follow-up questions based on the information provided by the vetting.
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21:50
‘We knew it was a strong relationship’
These are believed to have included why Lord Mandelson continued contact with Epstein after he was convicted and why he was reported to have stayed in one of the paedophile financier’s homes while he was in prison.
Mr Kyle said: “Both of these things turned up information that was already public, and a decision was made based on Peter’s singular talents in this area, that the risk of appointing knowing what was already public was worth the risk.”
Mr Kyle also pointed to some of the government’s achievements under Lord Mandelson, such as the UK becoming the first country to sign a trade deal with the US, and President Donald Trump’s state visit next week.
Mr Kyle also admitted that the government knew that Lord Mandelson and Epstein had “a strong relationship”.
“We knew that there were risks involved,” he concluded.
PM had only ‘extracts of emails’ ahead of defence of Mandelson at PMQs – as Tories accuse him of ‘lying’
Speaking to Sky News, Kyle also sought to clarify the timeline of what Sir Keir Starmer knew about Lord Mandelson’s relationship with Epstein, and when he found this out.
Allegations about Lord Mandelson began to emerge in the newspapers on Tuesday, while more serious allegations – that the Labour peer had suggested Epstein’s first conviction for sexual offences was wrongful and should be challenged – were sent to the Foreign Office on the same day by Bloomberg, which was seeking a response from the government.
But the following day, Sir Keir went into the House of Commons and publicly backed Britain’s man in Washington, giving him his full confidence. Only the next morning – on Thursday – did the PM then sack Lord Mandelson, a decision Downing Street has insisted was made based on “new information”.
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7:53
Vetting ‘is very thorough’
Speaking to Sunday Morning with Trevor Phillips, Mr Kyle said: “Number 10 had what was publicly available on Tuesday, which was extracts of emails which were not in context, and they weren’t the full email.
“Immediately upon having being alerted to extracts of emails, the Foreign Office contacted Peter Mandelson and asked for his account of the emails and asked for them to be put into context and for his response. That response did not come before PMQs [on Wednesday].
“Then after PMQs, the full emails were released by Bloomberg in the evening.
“By the first thing the next morning when the prime minister had time to read the emails in full, having had them in full and reading them almost immediately of having them – Peter was withdrawn as ambassador.”
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4:48
Government deeming Mandelson to be ‘worth the risk’ is unlikely to calm Labour MPs
The Conservatives have claimed Sir Keir is lying about what he knew, with Laura Trott telling Sky News there are “grave questions about the prime minister’s judgement”.
The shadow education secretary called for “transparency”, and told Sunday Morning with Trevor Phillips: “We need to understand what was known and when.”
Image: Laura Trott says there are ‘grave questions about the prime minister’s judgement’
They believe that Sir Keir was in possession of the full emails on Tuesday, because the Foreign Office passed these to Number 10. This is despite the PM backing Mandelson the following day.
Ms Trott explained: “We are calling for transparency because, if what we have outlined is correct, then the prime minister did lie and that is an extremely, extremely serious thing to have happened.”
She added: “This was a prime minister who stood on the steps of Downing Street and said that he was going to restore political integrity and look where we are now. We’ve had two senior resignations in the space of the number of weeks.
“The prime minister’s authority is completely shot.”
But Ms Trott refused to be drawn on whether she thinks Sir Keir should resign, only stating that he is “a rudderless, a weak prime minister whose authority is shot at a time we can least afford it as a country”.
If you want to know why so many Labour MPs are seething over the government’s response to the Mandelson saga, look no further than my mobile phone at 9.12am this Sunday.
At the top of the screen is a news notification about an interview with the family of a victim of the notorious paedophile Jeffrey Epstein, saying his close friend Peter Mandelson should “never have been made” US ambassador.
Directly below that, a Sky News notification on the business secretary’s interview, explaining that the appointment of Lord Mandelson to the job was judged to be “worth the risk” at the time.
Peter Kyle went on to praise Lord Mandelson’s “outstanding” and “singular” talents and the benefits that he could bring to the US-UK relationship.
While perhaps surprisingly candid in nature about the decision-making process that goes on in government, this interview is unlikely to calm concerns within Labour.
Quite the opposite.
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For many in the party, this is a wholly different debate to a simple cost-benefit calculation of potential political harm.
As one long-time party figure put it to my colleague Sam Coates: “I don’t care about Number Ten or what this means for Keir or any of that as much as I care that this culture of turning a blind eye to horrendous behaviour is endemic at the top of society and Peter Kyle has literally just come out and said it out loud.
“He was too talented and the special relationship too fraught for his misdeeds to matter enough. It’s just disgusting.”
There are two problems for Downing Street here.
The first is that you now have a government which – after being elected on the promise to restore high standards – appears to be admitting that previous indiscretions can be overlooked if the cause is important enough.
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4:48
Government deeming Mandelson to be ‘worth the risk’ is unlikely to calm Labour MPs
Package that up with other scandals that have resulted in departures – Louise Haigh, Tulip Siddiq, Angela Rayner – and you start to get a stink that becomes hard to shift.
The second is that it once again demonstrates an apparent lack of ability in government to see around corners and deal with political and policy crises, before they start knocking lumps out of the Prime Minister.
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2:22
Sir Keir Starmer is facing questions over the appointment and subsequent sacking of Lord Mandelson as the UK’s ambassador to the US.
Remember, for many the cardinal sin here was not necessarily the original appointment of Mandelson (while eyebrows were raised at the time, there was nowhere near the scale of outrage we’ve had in the last week with many career diplomats even agreeing the with logic of the choice) but the fact that Sir Keir Starmer walked into PMQs and gave the ambassador his full-throated backing when it was becoming clear to many around Westminster that he simply wouldn’t be able to stay in post.
The explanation from Downing Street is essentially that a process was playing out, and you shouldn’t sack an ambassador based on a media enquiry alone.
But good process doesn’t always align with good politics.
Something this barrister-turned-politician may now be finding out the hard way.
A man has admitted arson after a major fire at an MP’s constituency office.
Joshua Oliver, 28, pleaded guilty to starting the fire which destroyed the office of Labour MP Sharon Hodgson, at Vermont House in Washington, Tyne and Wear.
The fire also wrecked a small charity for people with very rare genetic diseases and an NHS mental health service for veterans.
The guilty plea was entered at Newcastle Magistrates’ Court on the basis that it was reckless rather than intentional.
Image: Hodgson, who has been an MP since 2005, winning her seat again in 2019. Pic: Reuters
The Crown did not accept that basis of plea.
Oliver, of no fixed address, had been living in a tent nearby, the court heard.
Northumbria Police previously said it was “alerted to a fire at a premises on Woodland Terrace in the Washington area” shortly after 12.20am on Thursday.
“Emergency services attended and no one is reported to have been injured in the incident,” it added.
Drone footage from the scene showed extensive damage to the building.
A spokesperson for the Crown Prosecution Service said: “Our prosecutors have worked to establish that there is sufficient evidence to bring the case to trial and that it is in the public interest to pursue criminal proceedings.
“We have worked closely with Northumbria Police as they carried out their investigation.”
Oliver was remanded in custody and will appear at Newcastle Crown Court on Tuesday, 14 October.