Introduction
Earlier this year Morecambe MP David Morris gave a speech in Westminster Hall regarding Morecambe Town Council’s precept, prompting the Minister for Local Government, Simon Hoare MP, to contact the Council requesting the following information:
- The background to the 231% precept increase in 2023-24
- The Council’s interest and withdrawal of interest in the ‘Frontierland’ site
- The use to which the associated unspent precept income may be put; and
- The factors underpinning the setting of a £97.56 precept for 2024-25
The following response – which addresses these points and corrects the record on many factual inaccuracies in Mr Morris’s speech – has been sent to the Minister following approval at the Full Council Meeting of Morecambe Town Council on Thursday 21 March 2024.
Letter to Simon Hoare MP, Minister for Local Government
Dear Mr Hoare,
Thank you for your letter.
We are grateful to be presented with the opportunity to respond to your questions and share the facts around Morecambe Town Council’s precept and the history of its interest in Frontierland. We hope that the full account below will help clear any concerns you may have about the finance and governance of the Council and demonstrate that the current administration is working hard to achieve a satisfactory resolution that neither endangers existing services nor prevents the Council responding to future community needs.
Following this, it would also like to take the opportunity to correct the record by responding to the many factual inaccuracies regarding Morecambe Town Council and its council tax precept in Mr Morris’s Westminster Hall speech, which prompted this correspondence.
Wider context
To understand the recent council tax levies, it is necessary to understand Morecambe Town Council’s full precept history, its relationship to the government agendas for localism and levelling up, and the current context of services within the town to appreciate why we are where we are today.
In his introduction to the Plain English Guide to the Localism Act then Minister of State for Decentralisation Greg Clark said, ‘We think that the best means of strengthening society… is to help people and their locally elected representatives to achieve their own ambitions… We are breaking down the barriers that stop councils, local charities, social enterprises and voluntary groups getting things done for themselves.’ This is expanded on further in the document: ‘We think that power should be exercised at the lowest practical level – close to the people who are affected by decisions, rather than distant from them. Local authorities can do their job best when they have genuine freedom to respond to what local people want, not what they are told to do by central government. In challenging financial times, this freedom is more important than ever, enabling local authorities to innovate and deliver better value for taxpayers’ money.’
As a first-tier local authority with a clear understanding of issues affecting the local population and ideas of how to address them, Morecambe Town Council is wholeheartedly supportive of this drive for localism. Both the current and previous administration were keen to get things done, achieve their own ambitions, innovate, deliver better value for taxpayers’ money, and respond to what local people want. Since 2008, the town has seen its principal authority, Lancaster City Council, absorb a 40% cut in funding, while Lancashire County Council has had to find multiple, multi-million pound savings over a number of years. In recent years this has resulted in gaps appearing in the number and quality of valued local services. Morecambe residents were particularly upset about the declining cleanliness of streets and upkeep of public spaces, the neglected environment this created for residents and the negative perception this left with visitors to the town. In the spirit of localism, Morecambe Town Council has been determined to respond to this.
Furthermore, a 2023 report from centre-right think tank Onward Levelling Up Locally identified a direct correlation between state of the public realm and preventing or reducing anti-social behaviour; the importance of events in helping town centres adapt to a post-retail-driven high street; and how local community groups are best placed to provide long-term support to the most vulnerable members of communities in areas of real poverty. These three (of five) key areas were identified as priorities for councils to focus on in order to support the Levelling Up agenda from the bottom up, by increasing pride in place, quality of life, and the things which are the foundations of economic development in the long-term. All of the investments that Morecambe Town Council has been making over the past few years have been in these three areas.
Morecambe Town Council’s precept growth
Morecambe is not a small rural parish with a population in the hundreds. It is a significant urban area with more than 33,000 residents and contains some of the most deprived areas in the country. To make a significant impact requires an appropriate level of finance. However, from its founding in 2009 through to 2021, Morecambe Town Council’s annual precept for a Band D property was under £20, with its then largely reactive function fulfilled by three officers. As the minister points out, the precept is a town or parish council’s primary source of income. Clearly, given the size of the town, any growth in service delivery was going to necessitate a corresponding rise in the precept and staffing over a number of years, beginning as it was from such low levels.
The Council therefore began on this journey. In 2022-23 the precept rose to £44.11, which was still £33 below the national average at the time (and negligible compared to the average of town or parish councils delivering an equivalent level of service that Morecambe Town Council aspired to deliver).
2023-24 saw the major one-off increase for creation of a Community Action Fund (hereafter CAF). We will return to this in more detail, but at this point the important thing to note is that a significant precept rise would still have been necessary even if the CAF hadn’t been raised, to fund the expanding services Morecambe Town Council was now beginning to provide.
Our 2024-25 precept, set at £97.56, sees a return to the trajectory we would have been on without raising the CAF, partly subsidised by reallocation of money from the CAF.
Morecambe Town Council now has a team of Town Rangers delivering public realm improvements around the town; a service which receives an overwhelmingly positive response and is highly valued by residents for providing cleaner, safer streets, restoring and maintaining much-needed civic pride. The Council provides vital funding for services from foodbanks and homeless shelters to sports clubs and creative communities through community grants; and it supports the town’s vibrant festivals and events scene, which does so much to stimulate the local economy, through grant awards and producing its own events, including the much-heralded Coronation Carnival last year.
All of this will cost a Band D taxpayer just £1.88 a week in 2024-25 and will be achieved at a Band D rate over £24 less than the national average precept (£121.76) for genuinely comparable parish and town councils last year (regional town/parish councils that collected a total precept between £250k-£1m). For further context, in 2023-24 there were over 1,150 parish or town councils collecting a larger Band D precept than Morecambe Town Council will collect in 2024-25 – that’s over 10% of all parish and town councils collecting a larger Band D precept last year than Morecambe will this year.
As you can see, Morecambe Town Council’s purpose and remit has fundamentally changed since 2021. It obviously can’t return to its historic precept levels, as suggested by Mr Morris, without cutting services such as the Town Rangers, which would not be welcomed by the community or in its best interest.
2023-24 precept, Community Action Fund, reserves, and reallocation
The £1m Community Action Fund (CAF) was created via a significant rise in the precept in 2023-24 for the purpose of a proposed community project on the Frontierland site. Raising funds in this way is not unusual. A town/parish council has no direct access to government funding. The only way it can enact a step-change in service delivery (which is actively encouraged by the localism act) or fund a significant one-off project in the hope of making a meaningful difference to its local community is by increasing the precept. And this is what Morecambe Town Council did – in the same way the Minister’s own parish raised funds for expansion of the cemetery, as mentioned in his response to Mr Morris.
Examples of higher tier authorities passing services to parish and town councils, or parish and town councils expanding their remit, can be seen across the country with large increases in both % and £ terms not uncommon. For example, in recent years Cornwall has devolved over £1.8m annual costs of library services to local councils and community groups; and in 2022-23 Kingsbrook Parish Council took over management of parks and green spaces, costs related to management of a sports pavilion, and incurred capital costs for equipment, necessitating a 468% rise in their Band D precept. Also in 2022-23, Bulwick Parish Council raised its precept by 571%, while Cotcliffe Parish Council raised its precept by 954%. In 2023-24, Widdington Parish Council raised its Band D precept by £156.62 (396%). Also last year, Salisbury City Council (which is a town/parish council) had a similar £102.04 rise to Morecambe’s £102.14 rise (this being on top of a precept already at £232.96, it was presented as a 44% rise as opposed to our 231% rise, which demonstrates the danger of drawing comparisons when just looking at percentage figures in isolation from actual amounts in pounds and pence). In total there were 341 parish or town councils collecting a larger Band D precept than Morecambe in 2023-24 – and for the majority those were the rates they had been operating at for multiple years, not single-year rises in anticipation of funding a one-off project.
As part of setting the budget and precept in 2023-24, the previous administration resolved to allocate all of its existing reserves against that year’s expenditure budget, thereby mitigating the need for any additional rise in the precept beyond what was necessary to create the CAF.
A new Council administration entered role following elections in May 2023 and resolved to change its direction regarding the Frontierland site, creating the question of what to do with the CAF. The Council received advice from the National Association of Local Councils that it would be reasonable to reallocate this money as the Council saw fit, given the original purpose for which it was raised was no longer applicable. Following the Government’s own guidance on fiscal responsibility, local councils are advised to hold between 25% and 100% of projected net revenue expenditure as general reserves, taking into account their size, situation and risks. With the general reserve at £0 at the commencement of FY23-24, the Council subsequently resolved to reallocate the entirety of the CAF to re-establish general reserves ahead of the 2024-25 budget-setting process, which is within the advised 25%-100% bracket. In the budget subsequently approved, it was resolved to use £150,000 of the general reserve to subsidise the precept this year.
Councils are obliged to deliver a balanced budget that generates enough income to cover planned expenditure. Therefore it wouldn’t have been possible to reduce the precept to £0 as suggested by the Minister. The projected expenditure for 2024-25, being in excess of £1m, was more than the amount now held in reserves. Without any income via the precept for the year, the Council would run out of money during the year once the general reserve was depleted. Knowingly embarking on this path would be financially irresponsible and unlawful, as the Council cannot set a deficit budget.
Attempting to return the full £1m in a single precept subsidy would present a similar issue. The general reserve would be completely depleted and the resulting nominal Band D precept of £10.40 would leave no margin for error or unanticipated costs in year, seriously jeopardising service delivery. Furthermore, the following year the Council would have to raise the precept back up to over £140 in order to set a balanced budget against an anticipated similar projected expenditure while rebuilding a minimum advisable level of reserve. This would be painted as a 1273% tax increase and no doubt result in similar protestations and vilification from Mr Morris.
The Council has already demonstrated that it is committed to returning a proportion of the CAF to the taxpayer, but doing so in a manner that doesn’t neglect its fiscal responsibility to safeguard services and avoiding repeated vast fluctuations in the precept year on year. It believes the only practical and achievable mechanism for ‘returning’ money to the taxpayer is through subsidising the precept. It believes it is taking a sensible, pragmatic approach by returning £150,000 via a subsidy of the precept this year and holding the remaining £850,000 in general reserve while the Council considers the most appropriate course of action for future years. With over three quarters of members new to the Council, this allows time and opportunity to adequately understand and consider the Council’s finances and operation, fully consider costs for any projects in incubation, and consider additional subsidy of the precept in future years. This is where we are at the time of writing.
We hope you will see, through our willingness to provide you with a thorough explanation, that both the previous and current Morecambe Town Council administrations have endeavoured to follow sensible and measured processes, perform due diligence and assess all options before making decisions, with fiscal responsibility at the forefront of all decision-making. It will not now be rushed into making knee-jerk decisions in the face of external pressure, particularly when applied by elected officials that have not engaged with us directly to understand the facts.
Other inaccuracies
Finally, there are a number of further inaccuracies in Mr Morris’s statement that we feel are particularly important to respond to, to correct the record.
Frontierland ‘double taxation’
The idea that the raising of the CAF was ‘double taxation’ is misinformation that has been consistently repeated and reported to suit a particular political narrative, predicated on the mistaken understanding that the money was raised to purchase land already owned by Lancaster City Council.
It needs to be clearly understood that the money was not raised to purchase land, as was clarified and minuted during the full council meeting of Morecambe Town Council in February 2023. Cabinet members of Lancaster City Council had indicated willingness to explore gifting a portion of the land to the community if the City Council were able to secure an adequate receipt for other parcels of the land, and provided there was a viable project and sufficient funding available. The Fund was therefore raised to:
- provide the necessary demonstration of funds to Lancaster City Council to prove a viable project could be achieved
- develop a viable project based on the community’s ideas and – had it been approved by City Council – deliver it
- act as seed money against other funding sources to help fully fund the project.
None of these things had been or would have been done or paid for by any other public body and so do not constitute double taxation.
Politicised officers
All officers in local government sign up to the Nolan principles, which include operating with impartiality. They exist to serve the Council and deliver on their resolutions, whatever the political makeup of that Council is. Suggesting that officers may be working on behalf of any political party is deeply offensive to local government officers not only at Morecambe Town Council but thousands of others all across the sector. To make such claims without any supporting evidence is doubly so. The phrasing of this accusation – ‘nobody seems to know’ – suggests Mr Morris himself is aware there is no basis for this unfounded speculation and we would request that he formally withdraws it.
Legitimacy of MTC’s Frontierland consultation
Characterising the consultation Morecambe Town Council carried out as a ‘stall survey on the local prom’ where ‘it cannot be verified whether any local people were present’ is completely dismissive of the extensive consultation the Council undertook.
This survey was conducted online and received extensive promotion, with offline opportunities for residents to come and share views, including an in-person consultation event held in Morecambe Town Hall.
There were responses from over 1,500 individuals to Morecambe Town Council’s Frontierland consultation survey, 90% of which came from residents. We know this based on answers to specific questions addressing provenance including postcode data. Support for a community development on the site was overwhelming, with over 5,500 different ideas offered by the public. 95% of respondents indicated that they supported the Town Council working with residents to safeguard the site to meet the needs of the Morecambe community. These numbers are not insignificant. For reference, Lancaster City Council have received c.450 responses to their own public consultation on the same issue.
Regarding the number of people who indicated willingness to give money to the project – the 255 people referred to by Mr Morris only includes the most common responses published and does not include the full range of respondents in the complete data. In total there were over 450 respondents who indicated they would be happy to give amounts ranging from £1 to £15,000. A similar number indicated they wouldn’t or couldn’t, even if they were supportive of the project, and a slightly higher number did not respond.
To suggest that no-one would actually want to give £15,000 to the proposed project on the Frontierland site is a disservice to the generosity of local people – some people care deeply about the place in which they live and are willing to give large sums of money to support it, or as a legacy to leave their mark. For example, just earlier this year a leading local leisure entrepreneur gave £50,000 to St John’s Hospice in Lancaster. It’s called philanthropy. The particular respondent in question completed the survey it in its entirety (including their name and contact details) and indicated they were fully supportive of the project and as such it should be taken at face value. Mr Morris himself accepted a £10,000 donation from Aquind Ltd in 2019, so should be aware these sums of money are not extraordinary.
Regarding Mr Morris’s survey, we would suggest that more care needs to be taken in presenting accurate facts and figures in a public forum. When discussing his own survey, Mr Morris’s assertion that 3,919 people is 26.8% of the population of Morecambe is untrue – that would put Morecambe’s population at just 14,623. There were over 33,000 people living in Morecambe at the time of the last census in 2021. There are currently just shy of 26,000 people on the electoral register within the Morecambe Town Council boundary alone. Even giving Mr Morris the benefit of the doubt and assuming he was referring to residential households in the Morecambe Town Council boundary, there are 17473 properties on the valuation list for Morecambe. However you cut it, this percentage figure has been grossly inflated.
Finally, it is worth considering that self-selection takes place when it comes to completing any survey. Whether an individual participates depends on all sorts of things from the issue in question to that individual’s level of engagement with the surveying body, to the method by which information is collected and how it is presented. It should therefore not be any surprise that both ours and Mr Morris’s surveys prompted contrasting responses, coming as they most likely did from different subsets of the community and, in Mr Morris’s case, accompanied by a letter clearly crafted to encourage returns of a certain kind of response. Their validity is not mutually exclusive and the results of Morecambe Town Council’s survey are not simply overridden by the results of Mr Morris’s.
Morecambe taxpayers subsidising County public realm work
The misinformation did not stop at Frontierland, but also extended to recent services undertaken by Morecambe Town Council on behalf of Lancashire County Council. Mr Morris’ assertion that Morecambe taxpayers subsidise a service across the entire district is a dangerous narrative to create and again is entirely incorrect.
Some of Morecambe Town Council’s Town Rangers are allocated to spend a portion of the year delivering a weeding service on behalf of Lancashire County Council (which includes Morecambe). The costs related to this are covered entirely by the £63,295.67 annual fee received from Lancashire County Council which rises annually in line with RPI. The majority of the year is spent making improvements and providing enhanced services within Morecambe Town Council’s boundaries.
The principles of economies of scale, achieved through delivering the County service, enables the Town Council to operate a more robust and efficient service across Morecambe for the remainder of the year, with the service fee received able to subsidise other ongoing costs such as equipment purchase, fleet expansion, utility costs, and PPE.
The Town Council already employed three Town Rangers prior to commencing discussions regarding the County service, and if anything, the Council’s view is that the County service enables the Town Council to scale up its operations to deliver a better service to Morecambe residents, not the other way around.
Audit costs as evidence of financial irresponsibility
Morecambe Town Council’s increased audit costs are due to repeated challenges by a pair of individuals with a particular history with the Council – one being a former Councillor, and the other being a previously engaged auditor whose work was not accepted as being of a sufficiently high standard by the Council. A second auditor was engaged and their report was submitted and accepted, with the Council withholding part of the payment to the original auditor on the basis of their work being incomplete. The subsequent court case ruled that payment of the outstanding amount to the original auditor was still necessary regardless of the standard of their work, and the Council therefore complied.
In subsequent years this pair of individuals have weaponised the audit process by submitting thousands of pages worth of objections and challenges in the hope of finding some form of technical or financial impropriety. Thus far our Officers have responded to these in good faith. It is important to note that following two investigations undertaken in 2020-21 and 2021-22 as part of the standard external audit procedure, conducted by an external auditor – PKF Littlejohn – appointed by the SAAA (an organisation set up by the Government’s Department for Communities and Local Government in 2015), the Council was provided with a certificate of completion stating “in our opinion the information in Sections 1 and 2 of the AGAR is in accordance with Proper Practices and no other matters have come to our attention giving cause for concern that relevant legislation and regulatory requirements have not been met”.
However, just providing all the documentation to demonstrate this, respond to challenges, and the additional officer hours necessary to facilitate this costs money. This pair of individuals are projected to cost the taxpayer an additional £9,000 in the coming year alone due to the increased billable hours from the external auditor and the additional staff resource necessary to manage the sheer volume of correspondence and work generated by their relentless FOI requests and audit challenges. This is while they simultaneously proclaim they are trying to reduce costs to the taxpayers and deliver value for money.
With this showing no sign of abating, once again the Council is simply being pragmatic and fiscally responsible by budgeting for costs that can be reasonably anticipated with the 23-24 audit process.
Concluding remarks
Finally, Morecambe Town Council is keen to point out it has previously invited Mr Morris to come and discuss its operation, funding, and the challenges facing the town and parish council sector on a number of occasions – both publicly and privately. Unfortunately it has not yet been taken up on this offer. It would undoubtedly be in the public interest for this to take place, to reduce the amount of misinformation being repeated in public, improve Mr Morris’s understanding of the local government sector and Morecambe Town Council’s specific state of affairs, and hopefully help form a positive future working relationship. Therefore the Council would be grateful if you could encourage Mr Morris to take up our offer and agree to meet and discuss all of these issues, rather than continuing to share misinformation in Parliament, in the press, and over social media, which does no good for people’s faith in politicians and local government.
Thank you for taking the time to read our response. We are happy to answer any follow up questions and would also extend an invitation to the minister to come to Morecambe to discuss all of this in person should he be interested in doing so.
Yours sincerely,
Cllr Claire Cozler on behalf of Morecambe Town Council
Appendices
Appendices were included directing to the Indices of Deprivation map for Lancaster and the map found on the Office for National Statistics website indicating Morecambe’s parish boundary, both of which are hyperlinked in the article above. A further appendix included photographic evidence demonstrating just some of the services Morecambe Town Council delivers.