Faced with cuts, Newcastle is fighting for fairness

The leader of Newcastle City Council calls for more honesty and openness in local government funding.

This piece is a response to Andrew Hankinson's blog post, "Nick Forbes: Newcastle’s king of cuts"

Last 20 November was the day when the government’s austerity programme turned from a theoretical national debate into a stark reality for the people of Newcastle. £90m of council cuts over three years, affecting every aspect of public life across the city. I described it as one of the darkest days for public services in Newcastle.

Residents have been shocked. Protesters fighting the closure of 10 of our libraries have accused me of being a Tory poodle, doing the work of David Cameron in a concerted attack on local services. The fact that some of the cuts affected our local cultural institutions pushed us into the national press. I received letters signed by a who’s who of the geordie cultural diaspora: Sting, Bryan Ferry and Robson Green to name a few. Writer Lee Hall is turning a legitimate and welcome campaign against cuts to arts and culture into an increasingly personal campaign against me. The local Liberal Democrats join with Eric Pickles in accusing me of deliberately exaggerating the cuts in order to pass the blame onto government and of megaphone diplomacy. I have been likened to militant firebrand Derek Hatton, who famously defied the Thatcher government by setting an illegal budget. Earlier this month, in a blog post for the New Statesman, Andrew Hankinson leapt on that particular bandwagon, accusing me and the council’s director of finance of making deliberate arithmetic errors to overstate the scale of the cuts for political reasons.

All this talk of politically motivated over-statement of cuts is a ruse to hide the real scandal. The figures are right. They are the inevitable consequence of decisions made in Whitehall and Westminster, not in Newcastle Civic Centre. Newcastle has been honest about the scale of the cuts facing not just our city but communities across the country. And the cuts have been deliberately and systematically loaded  against those communities least able to withstand them.

Unlike most councils, we set our budget for three years instead of the usual one or two. We did this for good reasons. The old method of annually 'salami slicing' budgets was no longer adequate. We needed to take a good hard look at what the council does, and plan over the longer-term. A three year budget gives us more scope to make radical changes. And more time to work with communities and partner organisations to find alternative solutions to avoid closure of the most valued facilities and services, and more time to minimise job losses by helping staff to retrain or redeploy.

But creating a three year budget has been a fearsome task, because it’s exposed the enormity of the challenge facing the whole of local government. We were among the first councils to look in detail at the consequences through to 2016. Since we published our budget, other cities have issued very similar proposals. Liverpool has to save £173m by next year; Leeds, £51m next year; Manchester, £80m by 2015 and Birmingham, £600m by 2017. Councils have cut £5bn and shed 230,000 jobs over two years with some of the deepest cuts yet to come. We are not the only council that is considering closing libraries and cutting funds to the arts. The Conservative-controlled Local Government Association has gone even further in spelling out the consequences of cuts to 2020, by which time local government will have no money left to fund any services beyond its core statutory functions.

And what of the argument that I was exaggerating the cuts back in November? Just before Christmas the government announced a further round of cuts, and our £90m cuts requirement became £100m. So it turns out we were actually under - rather than over - stating the scale of the challenge.

And the greatest scandal of all lies in the judgments made in central government about where these cuts should fall hardest, and how they are hidden in a fog of complex and opaque adjustments and misinformation. The government is making systematic decisions to move the deepest cuts to areas with the highest levels of social and economic need. The five councils with the highest levels of multiple deprivation, on the government’s own figures, are the same five councils facing the highest levels of cuts. During the four years of the Spending Review, £1bn will have been transferred from the North to the South and East, with some inner London boroughs also amongst the worst affected. Millions more have been transferred to shore up the inefficient system of local government in two-tier shire counties.

We need a new approach to restore trust to this broken system. I have led the call for an independent approach to determining the allocation of local government budgets, accountable jointly to local and national government.

In the meantime, I will get on with the job of supporting and improving our city. I will resist the calls for my colleagues to set an illegal budget, to defy the government in the way that Liverpool did in the 1980s. I will maintain constructive relations with ministers, for example with Greg Clark on the delivery of our Newcastle City Deal, and Patrick McLoughlin about the need for investment in transport infrastructure. But what I cannot do is join in a conspiracy to hide the consequences of unfair and unsustainable cuts. I will be honest about the implications for our great city, open to alternative proposals, work day-in, day-out to preserve the services that people have a right to rely on, and continue to fight for a fairer future. I hope the government, too, can bring a bit of honesty into its own decisions.

Nick Forbes is the leader of Newcastle City Council

Nick Forbes is the leader of Newcastle City Council

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After Article 50 is triggered, what happens next?

The UK must prepare for years, if not decades, of negotiating. 

Back in June, when Europe woke to the news of Brexit, the response was muted. “When I first emerged from my haze to go to the European Parliament there was a big sign saying ‘We will miss you’, which was sweet,” Labour MEP Seb Dance remembered at a European Parliament event in London. “The German car industry said we don’t want any disruption of trade.”

But according to Dance – best known for holding up a “He’s Lying” sign behind Nigel Farage’s head – the mood has hardened with the passing months.

The UK is seen as demanding. The Prime Minister’s repeated refusal to guarantee EU citizens’ rights is viewed as toxic. The German car manufacturers now say the EU is more important than British trade. “I am afraid that bonhomie has evaporated,” Dance said. 

On 31 March the UK will trigger Article 50. Doing so will end our period of national soul-searching and begin the formal process of divorce. So what next?

The European Parliament will have its say

In the EU, just as in the UK, the European Parliament will not be the lead negotiator. But it is nevertheless very powerful, because MEPs can vote on the final Brexit deal, and wield, in effect, a veto.

The Parliament’s chief negotiator is Guy Verhofstadt, a committed European who has previously given Remoaners hope with a plan to offer them EU passports. Expect them to tune in en masse to watch when this idea is revived in April (it’s unlikely to succeed, but MEPs want to discuss the principle). 

After Article 50 is triggered, Dance expects MEPs to draw up a resolution setting out its red lines in the Brexit negotiations, and present this to the European Commission.

The European Commission will spearhead negotiations

Although the Parliament may provide the most drama, it is the European Commission, which manages the day-to-day business of the EU, which will lead negotiations. The EU’s chief negotiator is Michel Barnier. 

Barnier is a member of the pan-EU European People’s Party, like Jean-Claude Juncker and German Chancellor Angela Merkel. He has said of the negotiations: “We are ready. Keep calm and negotiate.”

This will be a “deal” of two halves

The Brexit divorce is expected to take 16 to 18 months from March (although this is simply guesswork), which could mean Britain officially Brexits at the start of 2019.

But here’s the thing. The divorce is likely to focus on settling up bills and – hopefully – agreeing a transitional arrangement. This is because the real deal that will shape Britain’s future outside the EU is the trade deal. And there’s no deadline on that. 

As Dance put it: “The duration of that trade agreement will exceed the life of the current Parliament, and might exceed the life of the next as well.”

The trade agreement may look a bit like Ceta

The European Parliament has just approved the Comprehensive Economic and Trade Agreement (Ceta) with Canada, a mammoth trade deal which has taken eight years to negotiate. 

One of the main stumbling points in trade deals is agreeing on similar regulatory standards. The UK currently shares regulations with the rest of the UK, so this should speed up the process.

But another obstacle is that national or regional parliaments can vote against a trade deal. In October, the rebellious Belgian region of Wallonia nearly destroyed Ceta. An EU-UK deal would be far more politically sensitive. 

The only way is forward

Lawyers working for the campaign group The People’s Challenge have argued that it will legally be possible for the UK Parliament to revoke Article 50 if the choice is between a terrible deal and no deal at all. 

But other constitutional experts think this is highly unlikely to work – unless a penitent Britain can persuade the rest of the EU to agree to turn back the clock. 

Davor Jancic, who lectures on EU law at Queen Mary University of London, believes Article 50 is irrevocable. 

Jeff King, a professor of law at University College London, is also doubtful, but has this kernel of hope for all the Remainers out there:

“No EU law scholar has suggested that with the agreement of the other 27 member states you cannot allow a member state to withdraw its notice.”

Good luck chanting that at a march. 

Julia Rampen is the editor of The Staggers, The New Statesman's online rolling politics blog. She was previously deputy editor at Mirror Money Online and has worked as a financial journalist for several trade magazines.