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State of the City 2015 Speech

October 5, 2015

30th September 2015

Thank you for coming to our annual State of the City event today. It’s an important opportunity for us to take a step back from day to day issues, and look at our city in context. How are we doing, what are our challenges – and above all how are we working together to meet them?

As we gather here today, there is a difficult truth facing us – our desire to do good for the city has never been so far from our ability to deliver it.

My Labour Group, my Cabinet and I have dedicated huge amounts of effort and energy over the last 4 ½ years to shield residents from the worst of austerity, using everything we have to keep the economy and our sense of self belief going.

But that shield is now very dented, and there is more to come.

Right now we face a battle to preserve a commitment to delivering social justice at a time when the Chancellor, in his Comprehensive Spending Review, is sharpening the axe.

We are at a dangerous time for the city, where the next round of spending cuts risk being so severe they could undo decades worth of work helping the disadvantaged and the elderly.

The benefits safety net we once thought was there to help our must vulnerable pick themselves up and recover their pride has gone.

The support we are able to give to children and their parents, in their formative years, is severely reduced.

The money we use to ensure our elderly are not left lonely, at risk and reliant on hospital stays has being reduced, and is about to all but disappear as the Revenue Support Grant traditionally relied upon by councils to fund day to day services looks set to be eradicated.

Put simply, when it comes to what councils can do, the money has gone, but needs have not. In fact they have increased. Local government has already faced cuts of more than 40%, and the Government is determined to reduce public expenditure from 43% to 36% of GDP. That will have a profound impact on what councils will be in the future, and what we will be able to deliver. And the complexity of local government finance is lost on most people in our city, who often have little idea that council tax only constitutes 11% of the Council’s budget.

The council has lost £150m so far as a result of unfair and disproportionate Tory cuts, but the story does not end at the civic centre.

The Government’s welfare reforms, which already feel like they punish those who try to succeed, will mean Newcastle residents lose £148m annually by 2020-21.

We are not through the worst of the pain yet, and we will never recover to be the same all-encompassing organisation we were before. We are witnessing a fundamental rethink of how councils provide services, and indeed even if they should provide all of them.

With the council budget we will have to agree next year, and the Comprehensive Spending Review the government will announce this November, Newcastle expects to lose around £100m in cuts and new spending burdens over the next three years.

When the city has made similar savings over the past five years, we’ve seen services go altogether and justifiable outcrys over reductions in grass cutting, street sweeping, swimming pools or libraries. So far our focus for dealing with government cuts has been to reduce the ‘visible’ services that the council provides.

But now the people who don’t march are the ones who are going to be forced to take more and more of the pain, as a direct result of Government spending cuts.

Those who need the state to help them, either to help them pay for food, or to actually send someone round and make sure they have ate face a potentially difficult future. Cuts will now start to impact on the vulnerable, in a way that we have been able to avoid up until now.

In this city, we are asking ourselves again, what can we do to ensure those at risk of being left behind are given the best chance to do more than just survive.

Already, we have a track record of refusing to cower in the face of a challenge.
One of the most depressing things about the austerity seen in the last parliament was that it choked off growth and that the recovery took longer as a result.
To counter that, we borrowed to invest, making sure developments such as the Stephenson Quarter continued, providing jobs in construction, getting us ready for jobs at the recovery and sending a signal that Newcastle will not stop in the bid to create more and better jobs.

But the economy is not yet at full strength, and in the next few years we may see further economic turbulence. If the Chancellor does not take heed now, the spending review might mean local government does not have the capacity to intervene again.
To help where we can, we have developed an Active Inclusion Newcastle partnership, a group which responds to the growth in demand for information, advice and support in areas such as financial inclusion and housing services.

That sounds like the sort of dryly titled council entity that exits in the background, but what it does has a vital impact on the lives of thousands.
As a result of government cuts, for example,
Newcastle has the UK’s largest foodbank,
45,000 residents have been affected by welfare reform
and more than 13,000 of our economically active residents are out of work.

The scale of poverty and disadvantage and the change in the emphasis of the role of the welfare state from meeting basic needs to reducing welfare dependency has seen pressure like never before.

As a result, the inclusion unit provided advice to 26,950 people and accommodated 1,127 households.

Because of this partnership, 4,192 cases of homelessness were prevented, 8,901 residents supported to secure £24m of benefits hidden to them, and 3,857 residents were given advice to provide relief from excessive debt.

Look also at what we have done in the Council Tax Reduction Scheme. In 2013 the Government abolished council tax benefit and cut the money available for local schemes. Despite losing more than £8m to help families meet their bills, we maintained a system which says if you are in the need the council will help meet the majority of your cost to us, as long as you make a small contribution.

Delivering social justice though is not just a job for the council. We only have to look at the Syrian refugee crisis to see how this city unites in the face of a challenge.

As the pictures of those escaping Isis became ever worse, the city stood together to say our commitment as a City of Sanctuary is more than just a slogan. From across Newcastle people came together on a Saturday morning to plan how we will house, feed, clothe and educate those who we proudly say we will take in.

Elsewhere, we see the responsibility of “delivering for all being” met across the city.

The Newcastle business community has a role to play in how its corporate social responsibility programmes capital investment programmes and employment practices can contribute to improving quality of life in the city.

The voluntary and community sector has already shown how it can do more with less, now it needs to show further how it can play a role in unlocking social capital and the potential for citizens to become more involved in shaping their own neighbourhoods.

And the wider public sector has an interest in how it can sustain social justice through greater collaboration across all sectors.

The fight to preserve social justice will not be an easy one, but we have a potentially powerful weapon. Our battle for a substantial devolution package in which the government matches the ambition of the region is nearing its final stage.

Here, we have placed people, jobs and growth at the centre of our demands. Too often, devolution is pictured in terms of businesses or buildings. So let me say clearly today that our devolution deal would fail if it did not deliver social justice at its heart.

The current work programme has made a start nationally in getting hard to reach families and individuals into work. But it is a blunt instrument, it has left many behind, it can measure success without worrying about its regional record and it has failed those furthest away from the labour market.

That is because it is run from Whitehall. We cannot afford for future employment programmes to face the same failings.

In skills and young people we want the responsibility to set out how we will train the region’s workforce to match the region’s needs, so the work force has the skills needed for the future.

We already see great efforts here by our trade unions, who work tirelessly to seek to retrain and redeploy their members and bring about job security in the process. With control of skills funding we can add to that work.

And in the wider sphere of public service reform, we see that too often people get left behind when Whitehall’s departmental approach struggles to deal with people with cross cutting needs. There are better ways to work more closely together, and the decision around how we do that should be taken here in the region, so we meet the needs of the individual not some distant government target.

Dealing with people in relation to what government department they fit into is no longer a model that works as austerity cuts deep.

Right now, the region’s ability to co-ordinate a response to the problems it sees here is limited because those different organisations talk to government first. That is wrong, the people dealing with the consequences of failure should be first in the queue when it comes to directing limited resources.

It has been said before of politicians that the best way to judge them is to look at the enemies they have made. In the fight for social justice I will proudly say that this my colleagues and I have picked the right battles.

In the Syrian refugee crisis we did not ignore the pleas for help when bigots would have had us turn away.
In fighting for the funds to do the job, we speak out against a chancellor hooked on austerity even as we batter down the door to the Treasury demanding devolution.

In the region itself, we look at those who say it has always been done this way and we say not any more, we pick our fights for reform because we want social justice to prevail, even if the money is not there to defend that cause.

In the city we do not pretend that our commitment to social justice is for the good times only. We know the test of our beliefs is when times are hard, that it is exactly when the pressure is on that we see our strength.

In creating jobs we have shown we are prepared to act,
in defending the vulnerable we continue to fight their cause,
and in standing up for social justice, we continue to position Newcastle as the example for others to follow.

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