Introduction

 

“Unless you understand why things happened, then there’s no way you can change what’s going to happen”

 

“I used to think of history as a collection of dates and royalty. It gave me the impression that there were people who had an ordained ability to lead and rule. Suddenly I realised that history, far from being something that’s gone and finished with, has an immediate repercussion with what you are doing now.”

A Local Busman

 

In July 1980 there was a movement against the cuts in East Sussex. Over a period of ten days, some 1,400 people in the Brighton area went to protest meetings, largely about education cuts. Two demonstrations took place at Council headquarters in Lewes, each drawing 500 people on a working day. During the first, a group managed to get into the Council chamber and took over the floor, forcing the Council leader to come outside to face the crowd. During the second, an impromptu meeting was held with people from all over the County, speaking about the details of the cuts in their own area, gathering together in this way for the first time. The Tories had a very large majority on the Council, and their leader had written a letter to Mrs Thatcher declaring his commitment to monetarism and cuts. With few exceptions the cuts were made (in spite of resistance from the unions). But what was important was the surge forward in the anti-cuts campaign.

 

In the area of East Brighton from which this book comes a succession of meetings took place to discuss what could be done to support the resistance to the cuts of the Council workers. In addition to usual forms of protest, three suggestions were made:

 

1. to conduct a detailed study of council spending and finance in order to strengthen our arguments against monetarism and both County and District Councils, and lay bare what was actually going on;

 

2. on the basis of this, to make an alternative plan for the town, in the spirit of the Lucas Aerospace workers’ plans. (The Lucas workers drew up a 1,200 page plan to show that they could be employed making socially useful products in the existing factories rather than being made redundant. They developed 12 new products, all in prototype, such as a new type of kidney machine, heatpumps, and special vehicles for spina bifida children);

 

3. to consider ways of developing area unions, as forms of association designed to give protests more material power: unions outside work to complement unions at work.

 

The DETAILED STUDY we now want to make available in the form of this book. It is rooted in a place, but precisely for that reason has national relevance. Most of the book is taken up with an analysis of local state spending. We wanted to look at Brighton in the context of the national debate on local spending, since the national arguments for cuts were those applied by local Tories to justify their actions. We specifically wanted to examine the Tory claims that:

 

– council spending has increased much faster than the growth of the national economy (in the early 60s local spending was some 10% of GNP, and rose to 19% by 1975): that in this sense we have been consuming more than we earn, and that we have been having a ‘party’ on the rates.

 

– councils have employed too much labour, thus taking it away from the private productive sector.

 

– to cover this spending, councils have raised rates and taxes, thus decreasing the freedom of the individual to choose, and acting as a disincentive to work.

 

– they have also increasingly resorted to the money market, either shifting scarce capital away from the private sector, or increasing the money supply through borrowing from the banks.

 

How did these claims – made as often by Labour Chancellors and Secretaries of State as by Tories – square with our experience of local services, which has been one of steady decline?

 

QueenSpark’s experience of the local state (QueenSpark is the name of an East Brighton group) began in 1972. In one corner of Queen’s Park stands a building that looks like a Greek Temple. It was boarded up then, fenced off and overgrown. At one time it had been a Royal Spa, where a German doctor sold aerated tap water to the wealthy. Later it served for decades as a warehouse for a soft drinks company. By 1970 it had been abandoned. Children occasionally climbed over the fence, and got lost inside. As a listed building it could not be pulled down, only allowed to fall down. The acre of public land around it was a valuable asset, but not with the building. A chairman of the Council’s planning committee was reported to have said he hoped ‘two Irishmen would blow it up one night’!

 

One suggestion had been to make it into a nursery school. There were only two Council nursery schools in the whole of Brighton, a town of 160,000 people in which nearly 45% of the women and 75% of the men went out to work. The waiting list of the nearest nursery school was long. But the Council feared the expenditure and the Park’s Committee (chaired by a hotelier) launched a scheme to lease the area off to a speculative businessman who wanted to build a casino and high class restaurant there. It was then, in 1972, that the Spa campaign started and QueenSpark newspaper came into being. At first a petition with 2,000 signatures, then large public meetings, then a newspaper, it gathered together an overwhelming local feeling that this part of the park should be used for a nursery school and not a casino.

 

The campaign lasted five years. The council would not spend. The voters demanded that it should. Since they would not listen, we visited them (much to their annoyance) in numbers, at their homes and at their hotels. Since they would not use public land for public purposes we did it for them: clearing the scrub and planting potatoes, opening it up for a summer barbecue. More marches from East Brighton, more debates in the Council chamber. Then in 1977 we won. If you visit Queen’s Park now and walk down to the children’s playground, you will see to the south of the path, not brambles or a casino but a nursery school.

 

In East Sussex County Council’s estimates, the Spa is included under the smallest item of education spending, nursery schools. It is one of only three nursery schools provided by the Council in the whole of East Sussex. In July 1980, the Council announced that all three were on the shortlist for cuts. They could still try to close the Spa and the other nursery schools at any time over the next period.

 

II

 

The Spa has been only one experience of cuts and counter-campaigning from many in East Brighton. At the eastern end of the area looking out over the sea is Roedean public school for girls, set in extensive grounds with fees of £3,900 a year. Further north is one of East Brighton’s secondary schools, Stanley Deason High School. Or rather half of it. Its building was stopped in 1976 as the result of government cuts and the other half had to use the buildings of an old school three quarters of a mile away. The new school’s sports complex was frozen for five years. As the result of the cuts there are two fewer teachers and 40 more pupils, a reduction in remedial teaching, in technical drawing and in educational visits.

 

The school is on the Whitehawk council estate. Eight years ago, Brighton Council announced that it wanted to pull down half this estate, re-house those displaced on half the space they had formerly occupied, and let private builders develop the other half. The existing gardens, they explained, were too big, and the town was short of building land. Another protest. The Council said that the spare half would be given to Housing Associations but the destruction was to go ahead. The scheme is now frozen half way through. Some tenants have been moved to Portslade, five miles along the coast. Others are in houses which the Council have refused to maintain, and their complaints have been under examination by the Ombudsman.

 

On the coast to the south is an open-air swimming pool, the Black Rock pool, which served the estate and indeed all of Brighton. In 1968, 81,000 people swam there during the summer months. In 1978 it was closed, having been allowed to decay due to inadequate maintenance and blight from building works nearby. A large public meeting was held which unanimously asked for its re-instatement – with one dissenting voice, the local Tory Councillor, a hotelier who wanted the area developed as a motel. The Council has decided in favour of demolition, and asked for tenders from private leisure developers to rebuild the site.

 

Inland from Black Rock pool, you find the dense network of streets to the west of Queen’s Park, built to house service workers a hundred years ago. Some of them are still rented, others have been bought on a mortgage, repaired, re-created. In Hanover Ward, one third of these houses are lived in by retired people, half of them living alone. One by one, the corner shops have closed. The church hall at the top of Islingword Road mysteriously burnt down and was rebuilt as flats by a housing association managed by a speculative developer. Places where you could meet locally for a chat, or a party or a wedding reception have been disappearing. Nothing is taking their place. Many elderly people who perhaps retired to Brighton and then lost their husband, wife, or friends are chronically lonely. The local response was a campaign for a community centre: Hanover Community Centre. After hesitation, support came from both Councils. But now the cuts have left the Centre financially deprived.

 

In the next ward the neighbourhood has been less fortunate. A thriving social centre called Prior House had its funds cut off because the Council disapproved of the way it was run. In spite of a local campaign, the centre was closed and the building let off as a private social club run for profit.

 

So there is a common pattern. Public assets are run down and then offered up to private developers. Local need – except where the central government requires it be serviced – has not been an argument for council spending. It is only where local commercial interests are involved that the Council seems willing to spend outside government guidelines.

 

This is how we have experienced the local state over the last ten years. The cuts have only made it worse. St. Luke’s First School has lost its remedial teacher and the staff who could take the children to play on the fields of Brighton College, the neighbouring boys’ public school. St. Luke’s Middle School has lost one half-time remedial teacher and is to lose one full-time teacher in 1983. Queen’s Park First School, which has for years had less than the minimum playground space laid down by the government, is chronically short of money for books and art work. Queen’s Park Middle School has lost a part-time teacher, and its allowance for supplies cut by 20%. One school has already been closed (and sold to American Express). Another, Elm Grove, is threatened, in spite of a return to a rising birthrate in Brighton over the last three years. Only along the sea front, amongst the yachts of the Marina, in the mews garages and the luxury restaurants, does the recession appear as a stranger.

 

What then are we to make of the claim from government newspapers and even our own local Councillors, that council spending is the very cause of inflation and the recession? A Labour minister gave vivid support to this idea: Anthony Crosland, in 1975. Council spending had got out of hand. There had to be cuts. ‘The party’s over,’ he announced. What party? Certainly no one we knew in the area appeared to be having a party at the Council’s expense. The Council housing waiting list had stuck firmly at 1,700 for some years. Unemployment was growing. Local buses were getting scarcer and more expensive. Or so it seemed.

 

Since then the statements about over-spending have become a commonplace among our governors. The International Monetary Fund called for cuts in state spending in 1976, and the Labour Chancellor, Denis Healey, obliged. The severity of his cuts then, and in 1978 and 1979, appears moderate now, only because of the militancy of the monetarism now practised by Mrs Thatcher’s government. Each round of cuts is introduced by an attack on ‘profligate’ local councils and by insistent statements that we are spending more than we earn. The facts, says Mrs Thatcher, are clear.

 

Our facts indeed are clear, but they indicate the very opposite of the case that successive governments have portrayed. How could this be? Perhaps their ‘facts’ were different. Our facts came from everyday experience, taking our children to school, listening to their stories when they came home, seeking help for an invalid mother, looking after a house. Their facts were statistics. How much had been spent on primary schools. How many home help visits were made per 1,000 population. Their statistics were evidently telling them one story. Their experience of state services and the recession is different from ours. Not only do they have different ways of fact finding, they are looking for different facts with different ideas about what can be changed, about how to understand. They have a different way of seeing – one that is abstract, supervisory and self-interested. How can our experience be so misrepresented? How can we square what they say has happened with what we know has happened?

 

This book has been written to answer such questions, as a contribution to our common understanding. First we have sifted the main facts and arguments that have been used against local councils. Then we have gathered what we can about the funding and spending of our two local Councils. This allows us to look again at the national picture and offer some alternative interpretations of what has been and is now going on. This in turn may help us to think what more we can do to change things.

 

The book may be read in different ways. There is a photographic series in the book which, rather than only ‘illustrating’ the text may be ‘read’ on its own by going from picture to picture leaving out the words. The photographs can stand on their own, as well as be taken with the other chapters. There are also fourteen interviews with local people, transcribed from tapes. These, too, may be read independently of other bits of the book and are complements to it rather than illustrations.

 

Abstraction is part of the problem as well as part of the solution, and many people will find the testimony of people we interviewed more powerful than the more deliberately analytical bulk of the text. A battery of different ways of seeing as well as different ways of acting will be necessary if we are to challenge the monetarism currently ruling the roost.

 

Chapter 1

 

“If I owned a newspaper, you’d get my point of view”: Some Personal Experiences of the Cuts in Brighton

 

Adult Education Student. She is married with three school-aged children. She has a part-time job at a hospital, and as a school dinner lady.

 

I think adult education is very important because everyone has got a right to go on learning continuously if they wish. I know a lot of people, when they get older, they suddenly get this thing about going out and taking exams – and not just that, but learning masses of different things. I think you should have good adult education and good education for children. Perhaps it sounds a lot. But it shouldn’t be. Everyone’s got a right, if they want to, to be educated.

 

I went to St James’ School first. I didn’t like it. It was partly me as well, I was always shy. And I was fat, so people took the mickey out of me. In junior school it was absolute hell. I can remember running out of school whenever I could. And if I couldn’t get out of school, I’d stand in the corner. The only thing I wonder about was why no one noticed this was going on, or did anything about it.

 

The worst thing about schools is that they haven’t got enough people to teach the children, so everything has really got to be done through discipline. That’s the only way they can keep control of the situation. Also, they have to put the kids down. I think one of the best improvements they could make would be to employ enough people, so they would not only be able to educate the kids but deal with their problems as human beings. The worst thing in a lot of schools is that if kids are not up to scratch against other, brighter children, they’re humiliated because no one has enough time to deal with this.

 

You’ve got to have people in it who want to do the job, who aren’t just there to earn a wage packet. But again, they’ve got to be offered an amount of money they can survive on.

 

I suppose by the time I came to where I could have taken exams at school I just didn’t want to know. All I wanted was to get out of school as quickly as possible. By that time I was too far behind.

 

I started all over again as an adult. I didn’t know really what I could do. I thought I’d just like to have a go, and see if I could do anything more than I’d been led to believe I could. If not, OK.

 

When I first started classes I was terrified. I thought, “Oh no, if I go in there and there’s desks lined up, that’ll be the end.” But I found it was really good. It built up my confidence – and I had no confidence at all. Yet now I feel more confident than I’ve ever been in my life. I did a “New Horizons” course, then an English Language and English Literature ‘O’ level. And I passed the ‘O’ levels. I felt really good. I’d convinced myself I wouldn’t pass them before it came. Then, when I actually got the letter to say I’d passed them, it took three days to sink in that no one could say, “No, you haven’t”, or take them away. It makes you feel more confident when you go for a job. It may be irrelevant to the job, but it’s nice to be able to put that you’ve got an education. I’m doing ‘O’ level History now, and perhaps later I’ll have a go at the Open University.

 

At school our history teacher was quite good, quite encouraging, and he had said I could do ‘O’ levels if I buckled down and did something. But by that time I had no confidence in myself. I think it had been taken away through the whole school system, and I think it happens to so many people. The New Horizons course was the best thing that ever happened to me, because it showed me that being educated, learning things, didn’t have to be boring. Most of all I was lucky with the class I had. Especially when you’re an adult, it’s important you can get something wrong, and no one’s going to put you down.

 

That course was really fantastic, even though it was often very difficult to get there … babysitters falling through, my husband out of work, and I had part-time jobs as well. And until I got the ‘O’ levels, no one at home could really understand what I was doing or why it was important. It opened up all sorts of things for me that I’d never thought about at all.

 

I felt terrible when the courses were cut. I went along to a meeting at County Hall. I’d like to see those courses back and also things for people who are disabled. My Dad, he’s disabled now. If there were courses like that he could go on, which would keep his mind going, he’d not be likely to get so depressed. People tend to think disabled people want to do handicrafts and that, but not everyone wants to. People want to use their minds in different ways. So I think – I’d be happy to pay more rates to make classes free. Now it’s really getting beyond it. I’m sure people in Government don’t realise just how these cuts are affecting people.

 

A Busman who has worked for Southdown for the last nine years. Southdown are part of the National Bus Company and receive a subsidy from East Sussex County Council.

 

The small amount of time I’ve been on the buses has seen many changes. You often hear them bemoaning the fact they used to have their own buses. My first full-time mate used to come in in the morning about 1½ hours before he was supposed to and polish the bus, shine all the lamps up, wipe the seats. It was a pleasure to drive a bus after him because it was so spotless. Actually it makes you feel old when your first bus brake handle was made of brass.

 

I came into the bus industry at the rough end when it was suffering greatly, first from the transformation from a private industry which was on the wane, and unfortunately a lot of our branch members look back to those days with a certain pride because the bus company was making money. Also the boom of the late 60s’ and 70s’ was still in operation and nobody wanted to work in our job because the pay was so poor. Before the war a bus driver was regarded as something rather OK (two suits in the wardrobe and a holiday abroad or away). When I joined, it was the last resort or the crazy desire to drive a great vehicle…

 

When I started we had 18 1’s and 2’s running out of Whitehawk Garage. We’ve now got something like four. The garage was crammed full. I used to look forward to work because it was different. Even today there’s no way you can call it boring. It can be frustrating, soul-destroying, but never boring. There was a certain friendliness then because you were on the same routes all the time. You get to know the people and their quirks. Some talk to you and some are rude to you, and you gradually get to know how to deal with them all … It becomes a part of your life. I think the public also regret that they don’t have the same drivers … and of course they had a conductor with them too who was their mate.

 

Now conductors are a thing of the past. Our governor gave the last seven conductors at our depot (Whitehawk) the sack last year. It’s much to our discredit … our members have sold out our workmates. We hung on in our depot for a long time. We did succumb under the usual economic threats of redundancies and, “If we don’t make cuts … then it’s the best thing, chaps”.

 

It’s almost countrywide now, OPO (one-person-operated). It takes a certain type of person to be able to cope with OPO. You have to be determined to treat the job as two separate jobs (for ¼ more wages). I’ve seen men go one-manning who have always been cheerful … and within three or four months they drive past you and they’ve got a perpetual frown on their face and they blow up at the slightest thing … If you watch a busman on holiday, it usually takes him three days to stop looking at his watch … When you’re OPO you’ve got this psychological pressure from management to keep those schedules running (you used to get fined for running late). Then there’s a pressure, particularly near a meal break or finishing time. There’s the pressure, perhaps you’ll not believe this, of worry that the passengers are late for work, psychological pressure from the queue.

 

It’s difficult to say how OPO has affected the times of schedules. From the 50s you had an extra minute from Hove Town Hall to the Old Steine. You’re still supposed to run to the same time. You get 10 minutes to do it; 19 minutes from Portslade Station to the Old Steine; 35 minutes from the Old Steine to Rottingdean. But you have quicker vehicles … There is still stress. The stress of potential accidents … there’s always been a high heart disease among bus drivers, backache, stomachs. I’m told the life expectancy of a bus driver is lower than a miner.

 

Wages have deteriorated. I take home £96 after tax. If you take off 25% for OPO bonus and give me a conductor back and allow for inflation and increased tax, I’m probably about the same as when I started. That’s for 48 hours. On 40 hours I would take home about £75 maximum.

 

We have been continuously forced over the years by management, and by the national union negotiators, to work overtime in order to earn a normal decent living … At last year’s wage negotiation we went up to double time for Saturday working. For years and years we’ve been told we’ve got to work overtime. They’ve had long schedules and the only time they’ve brought them down is when the legal requirement makes them do it. You could see notices up on our boards every day requesting blokes to go and work overtime. We’ve got blokes who do seven days a week plus overtime every day. It’s an eight hour day now. The longest duty when I started was a 10½ hour shift and no meal break, and that’s hard. The union have continually increased the shift rate and overtime rate, so they have encouraged it.

 

Now suddenly the union want to cut the hours down and the management want to stop the overtime working. The dispute with management last year was that Southdown want us to work a rotating rest day. So Saturday will be time and a half instead of double time. A rotating rest day means you work MTWTh, FSSM off, then TWThFSSM, TW off, then ThFSSMT, WTh off. They’ll employ 30 more men as drivers so we won’t be able to work a rest day. They’ll be working rest days at a flat rate except for Saturday which is time and a half.

 

That’s the easy bit … At the moment we work an early shift and a late shift. Say this week I’m starting work at 6 am. I work Mon-Fri, have Sat. and Sun. off, start Mon. on late at say 3 pm. One of those turns will be a middle shift where you start at 10 am and work through to 6 pm. That’s how it is now.

 

They want to change that. Not only do they want us not to have Sat. and Sun. off, and rotate our rest days, and employ these extra men from our overtime payments, but they want us to work a mixed shift. For example, I could be on 6 am start on a Monday, 10 am start on a Tuesday, 4 pm start on Wednesday, 10 am on Thursday, etc. Not only that, the rotating rest day goes MT, TW, ThF, ThM, MT, TW, MW, then FSSM.

 

You really don’t know what shift work is like until you’ve worked it … You become a different person. Shift work is terrible for a family. There must be a bigger divorce rate on the buses than any job I’ve ever come across. This new system means there’s no way a married man will ever see his children, nor watch a continuing series on TV, nor go to night school, on a regular basis. You’re on your own.

 

Two Local Head Teachers.

 

There’s much more support given in school now by parents, because they’re invited into school. Before, they used not to be welcomed. At the same time, we’re open to much more criticism from them. I think, too, there’s the expectation from the public that schools do not exist simply for lessons and scholastic learning. They are far more social institutions in that, even though parents could have their children home for meals, they don’t particularly want to. And they leave the children in the school’s hands for the day, which does create problems for the schools which have never been successfully catered for.

 

I personally regret the fact that heads are becoming less totally responsible for their schools. I’m taking a one-sided view, as it were. There are many people who have objected for a long time to the enormous power that heads have had. And I think some heads will have abused this power. So I can only say that personally I’m sorry to see certain of my authorities go. I’m no longer able to say to the parents who come to visit me, who want their child to come to my school, “Yes, you may come. At such-and-such a date you’ll get a letter”. All I can say now is that I will forward their name to County Hall and they will tell them whether they may come or not. This seems to me to take away from my freedom to make the school attractive for children and their parents and to have the reward of their choosing my school. It’s now going to be organised numberwise by County.

 

I’m very torn because I do feel that the rates should be providing all that is seen to be necessary for children. And that parents shouldn’t have to contribute yet more money. And yet if one takes this view – it’s like the old view we used to have that, well, you don’t give to Hospital Charity Days because the government ought to provide. The government never does provide.

 

So, reluctant as I am to ask parents to raise this money, I’ve no alternative if we’re going to do justice to what I believe are our children’s education needs. I think they’re very well aware of our needs. But in this local area there are many old people who have not experienced these – shall we call them – luxuries, which are now present-day necessities, in their education. It’s very difficult indeed to convince these people and those without children how necessary this is. They see it as frills. They will tend to say, “I never had it and I did well without it”.

 

Just at the end of the war, there was very little money. People were really poor in those days and they had far less help from society than they get now. But they went for their little outings together. They’d get on a bus to have a little picnic. Not a lot of money was spent. But time and love were given. Now I think love is given, but in a rather different sort of way. Sometimes it’s expressed in money terms and with gifts rather than in time spent. Giving time … it’s so much easier to give money. It’s the companionship and the doing things together which is rare now.

 

We do need more money to be spent on providing more teachers, because it’s this personal contact with children which we’re failing to give them. We give as much as we can. But when it’s a teacher with 30 children there are many, the quieter ones, who don’t get more than say five minutes personal attention in the day. And this is where we’re not doing justice to children’s potential. If the ratio stays the same, we’re no better off. But if we could have classes of the order of 15 to 20, we could do a wonderful job. I think there would be no illiteracy.

 

Isn’t it said that this part of Brighton is very privileged to have Tarnerland and the Royal Spa? And of course one of the reasons we got the Royal Spa was because people were inspired by the example of Tarnerland to create something here. I don’t think it is a luxury if something is going to be the difference between your growing up as a whole person or not. I believe a luxury is, say, giving children chocolate biscuits they don’t need or do them any good, giving people things which don’t necessarily matter. I think people matter more than things. People need an environment where they can have room to grow as people. I don’t think any of us grow – particularly tiny children because they are new to the big wide world – when we are in a crowd and when we are pressured.

 

So we need more Nursery Schools and Nursery Classes, more spaces for young children to be in a child’s world. Here we give our patience, our imagination and our ingenuity into the child’s world for the child’s happiness and learning. If you do that, then you don’t have discipline troubles and children not wanting to come. It’s like Aladdin’s Cave: a lovely place for children to be. Not a luxury.

 

Going back to the early days, there was a lot of poverty. Nursery education was started to help poor children, because they certainly needed help. But it also stretched out to the so-called well-off child who needed to come to open their eyes away from the narrowness of their own family environment. For every nursery-aged child can benefit greatly from time in a child’s world with other children.

 

Today we don’t have the same poverty. But we certainly do have families with a certain deprivation. Some have fallen on hard times because of the recession or because of the break-up of the family. And there is the general disillusionment of hope – there’s a hopelessness around now. I think if we open our arms to the parents as well, if they can come into the school, we can perhaps help the families in our community and our effectiveness in helping our children to live is greater then.

 

I find there’s a lot of energy around in our parents. There’s a lot of wanting to be together. If we had more room in this place we could have more togetherness, which would engender the creativity that would bring some of these hopes to reality; hopes, that is, to live rather than to lose heart. But the fact that we all go back to our little homes means that we lose some of that possibility of being creative and really living.

 

Our parents want to get together to share and to do the very best for their children. A lot of our parents are very aware of the kinds of upsets teenagers have got: drink, drugs, losing jobs and losing hope. They are very determined to make sure that their children are well launched. They don’t only look to me; they look to each other. Now it’s jolly difficult getting a group going here. We have to pay, in our own school, to use it in the evening. That’s due to the cuts and it is hard to swallow. We desperately need another room apart from the children’s area for parents to meet in the daytime too.

 

In a nursery centre I visited they had a ‘built-in’ social-worker who shared in some of the problems with the parents. We are doing our best here, so it was very inspiring for me to see this centre achieving some of our goals!

 

I feel very much from my own experience that when people can get together, you get a healthy community. You may prevent depression, illness; you may save marriages, because you get help before it gets to that stage. I think that the way things are going there aren’t the facilities for joining with other people, for making a community that is nourished.

 

For me there is no argument. If you are going to have a world of people, you need a world for young children to be. Money should be spent on the young child. If it’s not, it’s so short-sighted and it leads to trouble later on. Then you’ve got to spend more money to cope with whatever goes wrong: delinquency, schools for the emotionally disturbed and troubled, people on drugs, etc. Most of all, children and parents are left with heartaches which perhaps we could alleviate in time.

 

I happen to feel absolutely, without any shadow of doubt, that if we’ve had a child in a nursery school or class for two years and we’ve done our jobs sensitively and well, day by day by day, then we have given that child a lease of life which means happiness and really living rather than hopelessness and failure.

 

Father of Three. Picture Framer. Member of East Brighton Residents Association.

 

I’ve been living on Whitehawk since 1936. I moved there from Albion St in central Brighton. That’s what the estate was built for – to rehouse people from the slum areas of Brighton. The Whitehawk estate was opened in 1934. The houses were built without subsidy, and very quickly. We’ve got a record of one batch of 200 houses which were built in one year – and those finished in 1933 are now mostly down. The real deterioration in the housing took place from the mid-60s to 70s, when the future of the whole estate was in question, and they are a lot worse today than they need to have been. But the history of that area is that it has been ignored both in respect of social facilities and repairs and amenities that people might expect. Since the total redevelopment of the estate was first mooted in 1968/9, the Council seemed to leave the place alone and didn’t paint, didn’t repair windows.

 

The redevelopment plan was originally to replace the 1,000 units of accommodation with 1,600 over 15 years. Six different schemes were put forward. The scheme they have opted for is approximately 50:50 municipal and Housing Association development, and the amazing thing is, when the estate is finally developed, which in view of the cuts is a very long way off, the Council will end up about 11 units better off and the rest will be Housing Association, of which the Council have a 50% nomination.

 

The thing I find quite appalling is that because of the lack of maintenance and repairs, it’s going to cost so much more to knock down and rebuild houses which are not as good in terms of structure as the original ones. The standard of building is diminishing. They’ll be slums within 10 years and cost the Council even more in the long run. You could write a book on the effect of the cuts on Whitehawk alone in terms of social upheaval and the terrible uncertainty under which people live. The end result is the phenomenal cost to the social life of the community which has been built up over the years. Even with an efficient Tenants’ Association which has regular liaison with the Council. Liaison has stopped now. Any Tenants’ Association must represent 30% of the area and the books have to be inspected to ensure that. We think this is a dangerous request. People would be afraid to join. So it is very difficult for us even to find out what the future holds for people still in those houses waiting to be demolished. Nobody seems to know.

 

Kids are growing up in uncertainty. We don’t know whether to do the garden, buy a new carpet … You’re obviously going to end up with trouble. 34% of young people are unemployed up there and we’ve also got the highest number of disabled people in rented areas.

 

It’s this uncertainty that they’re holding over our heads. They use it as an excuse not to do anything. When they say, “The country’s in a terrible economic situation, we’ve got to make these cuts”, we say, “No, you haven’t”. Our view is that if a thing is really needed, it’s needed and they have got to find the money somewhere to do it. That’s the humane society. We’re all responsible for each other.

 

But the basic underlying attitude of the Council is one of disdain. Any time they can score and save a few bob for the town at the expense of the people in this area and others, then they’ll do it. I won’t say that every single Councillor is that way inclined, but the vast majority. The attitude is patronising, and the method is divide and rule. Even down to little things like putting a fence up for one person but not another.

 

One resident had 33 visits for the central heating in his new house. In the East Brighton Residents Association we have a complaints secretary. Essentially we tell people to do it themselves first and if they don’t get satisfaction, they come back to us. We have a regular monthly meeting with the Housing Manager and two members on the Housing working party for Whitehawk. We have an advice bureau every Wednesday. We don’t use Councillors if we can help it. Up until November (1981) we’d taken up 1,400 cases over a year and had about 1,200 dealt with. I think that’s quite a good record. We’ve still got to be on our guard because we’ve got to watch that these Councillors are not letting us do it to take work off their backs and letting them cut jobs.

 

The Community Centre opened in 1973 after fighting for six years, meeting in back rooms, organising. Eventually, we got it. We thrashed out a management structure for the centre with the Council through public meetings. Now they’ve come along and said they’re going to scrap that structure and install one of their own.

 

The Community Association (CA) asked to build our own centre on amenity land provided on the redevelopment. The Council said, “Jolly good idea, can you give us plans?” We had plans drawn up and at the outset they were going to build the shell for £237,000. We would fit it out. As time went on this gradually got reduced to £137,000 … they can swing £100,000 off the amenities of 1,600 families! So in the meantime we’ve been negotiating to buy the church hall. We spent £3,000 doing it up from CA money and now it looks as though the Council will get away with lending us £22,000 to buy the church hall. They have saved £215,000. They’ve stolen a community centre and left us a social club. There’s no overall plan. I liken them to the wartime spiv who makes a quick buck every time he can.

 

Years ago, the community spirit of that area was fantastic. They worked together, helped each other to do anything. The community was absolutely tip-top. Then the uncertainty crept in and people didn’t know if their next-door neighbour was going to be their next-door neighbour in a year’s time. People get fed up with this and want to move out; people move in from another area. So you’ve got strangers coming into a situation of flux. You’re building up an unstable society, building on sand.

 

Homeless People in Brighton, (this interview was conducted in early 1982).

 

The situation in Brighton is not so much deteriorating as changing character. That is the most important thing. 12 years ago, in many ways it was worse. There were, for instance, 100 kids in care because of homelessness. That doesn’t exist any more, and it’s mainly through ‘Shelter’ that this has happened. Before ‘Shelter’, the housing problem was something that was not talked about. It wasn’t a popular thing for debate. Certainly, families are better off than they were 12 years ago. The number of actual houses is falling and the rented sector has dried up for various reasons, but the services themselves have improved. Social Services will not take kids into care, families do get priority need, all that kind of thing which wasn’t there before. In that sense things are better. That’s because of public opinion. The single homeless lose out because public opinion isn’t as strong about that. It’s the emotive issue about kids and families.

 

But the character has changed. The kind of people who were on the Council waiting list 12 years ago were unskilled workers. Now they are social workers and teachers, because housing prices have risen so dramatically since 1972. The cheapest house in Brighton is about £21,000. You’ve got to earn £7,000 a year to buy a house. Home ownership has extended to people with money rather than people with a residential background.

 

The housing situation deteriorated dramatically around 1975 when we had the Marina, and developers moved in, and a whole area on the Hove-Brighton border which had been bedsitters, like St Michael’s Place, was redeveloped as expensive flats.

 

The rented sector there vanished almost overnight. It was the kind of accommodation which was very low-cost, basically one room per family, but at least it was one room where a family could eat and cook and sleep. We used to have five evictions a day and the Council rehoused quite a few of those. That ‘bedsitter land’ has now gone and that was very, very much needed for people who couldn’t rent anything else and who couldn’t get a Council house.

 

The other thing that has deteriorated is the level of repairs. Houses that were OK are not OK any more. We have more substandard housing in Brighton than in Islington, which is roughly the same size.

 

The new Housing Manager, Michael Elbro, is incredibly good. The situation has improved dramatically since he came. There’s a marked difference in appreciation of need between the elected officers and the paid officers. Michael Elbro is very aware of people’s needs, but the committee itself, the Conservative Council, is totally unaware of anything like that. I think it’s very important to stress the difference between the two . . . For instance, this manager will not put people with two children in B&B accommodation. You’d be hard-pressed to find any other Conservative Council in the country which does the same thing. I must say it as I find it.

 

Council facilities for homeless single people are very few, a tenth of the need. There are a number of flatlets which are taken up by single people in priority need (vulnerable or disabled or over 65). The Council uses B&Bs, even with disabled people. When we talk about B&B places, I could show you some really lousy places where you’ve got six mattresses on the floor of the room, and you pay £25 for a mattress in the basement. The Council are aware of the standards in these places, but it’s very difficult … If you close all the bad places, then where are the people going to go? You end up with them sleeping on the beach. So whereas initially in our first enthusiasm with ‘Shelter’ we were pushing for standards, we dropped that long ago in practice, though not in theory.

 

Even a mattress in the basement is better than sleeping on the beach, although some people would rather sleep out. There are about 30 or 40 people on the Soup Run at the moment. Not all of them sleep rough. It depends. Men can always go to the ‘Spike’ (Resettlement Unit for men, 34 beds, funded by DHSS and Social Services on Area Health Authority Property) … but for women there is no hostel provision whatsoever … Not just that, B&B accommodation for women is very, very limited. A lot of B&Bs won’t take women because on the whole they don’t share in the way that men do. This means that women’s accommodation is much more expensive because single rooms are much more expensive than sharing ones. So women have to pay more and because there is a ceiling on the allowance that Social Security will pay, quite often they don’t have enough money to eat. Women are in a far worse position than men on the whole.

 

Unemployed Adult Education Student.

 

I think politicians just pick up anything which suits them in the way of a slightly cohesive set of words from which they might think up a good theory – the number of pupils is dropping, we can always slash the budget for this or for that. They don’t actually construct real ideas for themselves. What they are trying to do is save money. Any kind of slogan for presenting that which doesn’t just say, “We’re trying to save money”, is an acceptable front for them. What they really want to do is basically to stop all Social Security, throw out the National Health Service, pay-as-you-go the whole way, dismantle everything. I think there’s actually a majority of politicians who believe that cuts are the answer, probably among all parties. I don’t think there’s any really effective idealism left towards building systems for social welfare.

 

About education, adult education, I can’t think anybody really believes it’s not important, really believes you can afford to waste your adult population. It’s not an argument. It’s just another front for cutting costs. No one could believe, at a time when people have a fair amount of leisure, that you can afford to just waste it. It’s just a human natural thing to believe that people are the actual resources. I think even capitalists believe that. They know they don’t want mindless robots any more, even as an exploitable resource.

 

It must be fear. Because even if you were patriotic for example, who’s going to have long-term feeling for even the progression of their own capital in a country that’s decaying intellectually, just getting bored and unemployed, vandalistic, full of football hooligans, etc. I’m not saying they wouldn’t perhaps be a little bit nervous of people analysing how come there’s so much time available now and how to use it. Maybe they’d lose control of the systems that insist upon how we use it. People wouldn’t actually want to go to work quite so strongly if there were too many good courses available.

 

I can’t imagine any vein of philosophy that would positively work against adult education at a time of three million unemployed. It’s such an ideal opportunity, like people who were too busy previously to stop and learn a language in their business who have come out of employment. All they need is a bit of encouragement: here’s the opportunity, here are the courses, this is how you cover the fees, we’ll set up a few lending services, use your time well and learn to speak German or Japanese or be a better salesman or learn what micro-processors are; it doesn’t have to be just arts courses, it can be retraining.

 

Lack of funding isn’t a question to debate, good idea, bad idea, it’s just a mean, petty and vicious circle of ideas that trap the people. Very rich people saying very stupid things about very small amounts of money. “Why should people learn pottery? Why do 75 year old people want to study a language, they’re not going to be useful, are they?” There’s no point in arguing with ridiculous people like that. There’s no point saying it’s cheaper to keep someone’s mind interested than fill them full of drugs and put them in homes and treat them for this and that. There’s no point just accepting the fact that everything’s cut and you can’t have help, and you can’t have interests and you can’t have sparkle in your life.

 

There’s been a terrible lot of apathy in local politics, hasn’t there? People don’t know who their councillors are, what they can do: until something happens. There must be an awful lot of people now who’ve come in to the Save Our Schools campaign and it’s the first time they’ve ever been active in anything. It’s the first time they’ve noticed that they are going to be affected, or their favourite schools are going to be closed and they can’t see the logic of it, and they feel a bit irritated already with the pressure of the cuts and unnecessary wasting of human spirit, and so for the first time they’re actually going to get up and do something. It’s a general impression that you’re able to manipulate local politics fairly easily, but it’s not that easy to do. And especially since, I mean, Brighton Council’s a real pantomime – a joke writer couldn’t make a better Christmas pantomime of a local council.

 

The community is very broken down, and it has to reform basically from scratch, because families have moved apart so far – there’s no great tradition left. Communities are so powerful, families are so powerful if they stay in groups together supporting each other.

 

I’m not involved in education cuts movements but I do see the meetings as being sort of new in the sense of strong local groups. You find they have sold this local annexe, or pulled down this building, that someone once used for a pottery class on Wednesdays is suddenly going to disappear – and you put your heads together with a few people you wouldn’t otherwise get together with. The immediate thing that you think you’re going to lose probably is lost anyway, the school itself is gone or whatever, but what has really been lost is the sense of power to do anything about it because you hadn’t exercised it previously. You hadn’t demanded the right that if 50 of you together agree something is to be done it does get done. That’s the power that’s gone, and I think people might be realising that.

 

It has to be local. It is essential that the rates are a local payment and the people who pay it have to have some way of saying, “We’ll pay for these services but we really don’t want to contribute to any of these proposals”. Only local ways of organising things give people a chance to get some control. The issues that concern you mostly are first of all going to be local issues, things to do with your health, education, your own street, your own library. There’s no reason why there shouldn’t be national taxes to cover national affairs, but you could probably do with an awful lot less national taxation and decisions about things like Trident and Concorde. Most of it is lifeless and pointless.

 

How Two Local Social Workers see the Cuts.

 

It’s very hard for us to pinpoint what the cuts are, because we’ve been re-organised. This has meant a whole shift in the way we’re told to work, with much greater emphasis on voluntary groups doing the work, neighbourhood care and so on – which is a shift out of Social Services and out of the budget as well. These are in effect cuts in the general caring for people in the community. The whole drift of reorganisation is that more and more things will be done privately. They are depending on private old people’s homes to take up a lot of the numbers, because they’re not increasing the beds in line with the rising numbers of elderly people. The Council homes have always been a kind of last stop for people who really don’t have much of an alternative. I can’t really see that the private sector is going to open itself up and do a charitable job.

 

As far as I can tell, there haven’t been any studies to see how far the private sector is going to absorb these people or lower their rates. And if they do have an increased number of people to pick and choose from, they’ll presumably pick the people who are easiest to look after. So that, as the population gets older and into the 80s and 90s, and there are more senile people (which is confused old people), we’re going to need the beds we’ve got and probably need more.

 

They’ve cut five children’s homes. Small group homes. They say these small homes weren’t working and we’re putting the money into a big children’s centre and foster parents. Now foster parents are cheaper, anyway, per child. But it’s hard to argue or to prove exactly that it is a cut in the service. They’re saying, “It’s not a cut, it’s a re-organisation”. We’re saying, “Less money is being spent”. They say, “Ah, but it’s an improved service”.

 

The number of foster parents, despite a very extensive campaign in Brighton, has not risen. The numbers remain static. And there are only certain children under certain circumstances who can actually cope with foster homes. The small group homes with most staffing could actually cope with children who had particular problems or who were there for a short time. Or where it’s better that they weren’t put in a ‘hot’ situation with more patients to deal with. That sometimes happens. Because they have more support and there’s a greater staffing level they can actually hold on to these kids. Whereas, if they go to foster homes, it tends to break down and they go to another one. They need that sort of variety in provision.

 

The more you cut back, the less you have somebody monitoring, the more people you are going to have falling through the net. And the level of care will get worse.

 

When I started a few years ago, the Council was still providing holidays for the physically handicapped, or at least for those people who were both physically handicapped and knew how to get hold of the service. Since then, that has completely stopped. Now obviously it wasn’t a statutory requirement to provide holidays. It was something to improve the quality of life for those people.

 

I think the County Council’s argument, because of the public relations aspect, is rather subtle. They’re obviously concerned about their vote. What they are saying now is, “It’s a bad thing for a statutory authority to be providing these services. What people really want, the people out there, the public, is for the community to do it; that is more dignified; it’s less impersonal”, etc., etc. They are not stupid enough, if you like, to say publicly, “Well, it doesn’t matter if we don’t provide this, that and the other”.

 

I don’t think there is this great reservoir of voluntary labour that can provide the services that are needed. A lot of them are highly specialised. It’s not just a question of ‘popping in’ on an old person. It may be that they need a day-centre to go to, where they can actually meet with other people, and they need transport to get to that. They need their houses adapted so that as they get more handicapped they can continue to manage basic day-to-day tasks. No voluntary organisation without funding is going to be able to provide that.

 

If people are referred to us then it’s a sign that the alternatives have broken down already. You might be able to patch those up a bit, chivvying people along to provide a bit more than before. But my impression is that people are referred at the point where relatives are really desperate. Where they’ve tried going in, taking an old person in their own home and so on. And they’ve got to the point where it’s just not feasible for them any more to continue with that sort of care.

 

You’d need more home-helps; more meals-on-wheels; more flexible services. And there are worries about that as well. For instance, they are introducing an intensive domiciliary care scheme for the elderly. It will be to provide, say, three visits a day to an old person in a crisis period, seven days a week. Now the people working on that scheme, I think, are going to be really exploited. Their wages are very low. And yet they’re working unsocial hours in a very demanding, gutty kind of job. They are not being adequately paid for that, because of unemployment. They know now that they can get people to do this sort of work.

 

One of the main changes is to do with the control that is exerted over us – the way that we work – and attempts to control the way that we organise together as workers. Certainly in this recent re-organisation within Social Services, one of the main aims was really to try to control workers much more, and was a direct result of workers expressing dissatisfaction with policies publicly: organising in Cuts Campaigns, etc.

 

It’s couched in terms of re-organising the Department to provide a more efficient community-oriented patch-based service, i.e. re-organising teams from a central base in the town out to small areas, one team covering a small area. Whereas before, Brighton was split into North and South, and people worked over the whole area, now teams are both smaller (made up of two to three social workers) and cover a smaller area. That’s the way it’s been presented. But it’s also involved a massive shift around in managerial staff. The philosophy has been to undermine the power which field-workers have traditionally had. It’s because field-workers have been the best organised and most vocal group, that there is this kind of devaluing of our skills, and an attempt to crack down on meetings which involve workers across their little boundaries.

 

Interview with a Team of Five Dustmen.

 

A team of dustmen means one driver and four fillers. The driver also has to fill, but less. He’s paid a bit more, and has to take responsibility for the team. He has to have an HGV licence.

 

Interviewer: When we met in the street the other day, you began to tell us how your work had been affected by the cuts.

 

Dustman: Well, we’ve lost 15 jobs up here. We had 21 vehicles for Brighton, now there are 18. It started in February 1981. What they did was re-organise every beat, and 15 less men had to do the same amount of work.

 

Dustman: We worked to rule for a while, but in the end that just defeats the object. You’re hurting yourself more than anyone else, because we’re on a ‘Task and Finish’. The quicker you get the job done, the quicker you go home. The only thing we were doing was working longer hours for the same money. In the end you just draw the line and say, “enough’s enough”, same as in a strike.

 

Dustman: This ‘Task and Finish’ – it’s the greatest control in the world. You have so many streets, and they time the minutes it should take to do each street. Freshfield Road, for example. From top to bottom we are allowed, for 4 1/2 men, 706 standard minutes. If you can get it done in less, that’s your gain. But all you can gain is time, you can’t gain money.

 

Interviewer: Do they change these norms?

 

Dustman: They cut them down every year. There’s more pressure. If one week I’m emptying 1,000 and the next week I’m doing 2,000, I’m working twice as hard. As a crew we are given 114 extra bins. There’s no payment on that. We were silly enough to be working too quick and they’ve established a new norm.

 

Dustman: They introduced ‘Task and Finish’ in 1966 – now most places are on the bonus system. We’re on 33 1/3% bonus. At Lewes they’re on 66%. There are national pay agreements, but the bonus deal was negotiated here at a local level. They’re different everywhere. On the whole, they’ve reduced the standard minutes allowed and given us more work.

 

Dustman: When I first started up here the cubic capacity of a lorry was something like 35, now we’ve got one that’s 80.

 

Interviewer: So your pay is worked out on how much refuse you pick up?

 

Dustman: We get a basic pay for 40 hours, and then on top of that we get a third of the basic wage as a bonus. The bonus is set, because there is a set amount of work (even if everyone puts out twice as much rubbish). If we can’t get down Washington Street for example because of the way the cars are parked, I have part of my bonus deducted from my pay. Through no fault of my own.

 

Dustman: In 1979 there was a strike when Jim Callaghan said you could only have 5%. The tip operatives were on strike over the 5% and we wouldn’t cross the picket line. We went out and did the work and had nowhere to tip it. We filled up the carts. In 1970 it was Ted Heath. We asked for £2.50. They said £2. We went on strike for 50p, but your wages were that low that 50p was a lot of money in proportion to your wages. If we were to go on strike now, you’d be losing £60 odd – for 50p? – How long have you got to work to get it back? That’s why the miners don’t go on strike. It’s diminishing returns. As far as Trade Unions striking is concerned, it’s got them beat. They go out one at a time, and they’d all have to go together. Everything is different now. I’ve got a mortgage, he’s got a mortgage, a car, telephone, TV. That’s living to the hilt.

 

Dustman: I’ve been in it for 12 years.

 

Dustman: I’ve been in it for 14.

 

Dustman: And we’re very low paid. Our flat basic pay, wages without bonus, is £67. So, with a bonus system, if we complete our daily task, Monday to Friday, it would work out about £90.80 without stoppages. When we’ve paid national insurance stamps, tax, we take home something between £62 and £65. It fluctuates.

 

Dustman: I know a chap in a Council house. He’s a married man with three kids, and he has his rent and rates stopped out of his pay packet. He takes home £42 a week. That’s five people for seven days on £42 – you work it out.

 

Dustman: He’s unfortunate to be working. We’ve told him openly to his face – he’d get more on the dole.

 

Interviewer: Has unemployment made a difference?

 

Dustman: Yes – there’s a pool of casual labour. But on the whole people are in this job for quite a long time. It’s a job.

 

Interviewer: What are your working conditions like in general?

 

Dustman: Last week I had a rat jump down my leg.

 

Dustman: They think it’s a joke! Last February a hypodermic needle which had been pushed down in a bin went into my hand. I was told that I can catch hepatitis, and I had to go for two check-ups . . . and if I see adverts for disposable nappies on the tele I feel like putting my foot through it. Go to a bin, take the lid off – and there they are. Not wrapped up or anything; also cat litters, and, not being crude, soiled towels, not even wrapped up. And the people who are supposed to be of a better class are worse than the council tenants.

 

Dustman: We often get dermatitis. Other than that, back trouble and pulled muscles are common. Compensation is a sore point, because a lot of the time we’re on private property. If I fall through a rotten floorboard in your house, the only way I can get money is to claim off you personally.

 

Dustman: If you’re talking about cuts, we’ve got the ludicrous position up here, that when your gloves wear out, they’re issuing us with one glove at a time! They’re going to end up with a surplus of left-handed gloves. Yet I know for a fact that a head of section down the Town Hall ordered a new chair for £140. If there are cut-backs, let’s have a proportional cut-back all over.

 

Dustman: The cutbacks here are peanuts compared to other things. Not worth it in economic terms. The dustmen are more vilified in the press than anyone, it’s dustmen this and dustmen that. Why don’t people get up on their hind-legs about places like the Brighton Centre, which costs every man, woman and child in Brighton £10 on the rates.

 

Dustman: Do you know what it costs you as a ratepayer to have your dustbin emptied? You couldn’t even buy a Mars bar with it – it averages between 9p and 14p.

 

Dustman: To be a dustman – not everyone wants to walk around with a load of rubbish on their back – if you’ve got an incentive to be one, honestly, it’s not pay. The incentive was a ‘Task and Finish’ job. You came in, had a set amount of work to do, and when you’d done that your time was your own. But now, since the cuts, the harder you work the more they seem to push you. No early finish. But they don’t pay you for it.

 

Dustman: Coal-mining should be outlawed. If they had pandas doing it, there would be an outcry. Poor animal, groping around down in the dark. It would be prohibited. But a man can do it. If you said, as from next week coal-mining will be done by machines, what would you do with those men? It’s the same for us. Fair enough, if you can get a society that’ll share out, and I don’t have to work for a living. Great. But how do you do it?

 

Interviewer: Why do dustmen get a bad press?

 

Dustman: Because there’s no aura about it. We go to everybody’s house, irrespective of whether you’re on the dole or a brain surgeon.

 

Dustman: Who wants to be a dustman? People have taken this job and they’ve been ashamed to admit it to their neighbours. They’ll go in a charade of pretence to hide it. Some people say they work for the BBC (Brighton Borough Corporation). If I owned a newspaper, you’d get my point of view.

 

Dustman: We’re cast in the press as militant and bloody minded. Councillors are always calling us that. Yet we’ve ended up with lorries that hold over twice as much. We’ve ended up working more for the same money. That’s how bloody minded and militant we are.

 

Mother of Severely Handicapped Son, whom she has looked after all his life. She is on her own.

 

My son is severely handicapped. Before we moved here, a year ago, I was in a one-bedroom bungalow. We were waiting nearly three years for this house. In the other one we were pretty crowded. In fact, we had to sleep together. I’ve had to do practically everything myself here. Not even the social worker has been over to see how I’ve coped. The Social Security haven’t paid me anything, except £25 for bedding. They said to me, “We can only give you money for the bedding. Furniture isn’t an essential”. I always thought a table and chairs were essential.

 

It badly wants a carpet all over the floor. He has to exercise. I want to get him on the floor and let him romp around, but this floor is cold, really cold. But they said they couldn’t help me with the carpet, because there are supposed to be tiles on the floor. The social worker has written to the Rowntree Trust, but they haven’t said yet whether they can help or not. I tried the Social Services too, but they told me they didn’t do anything like that.

 

I’ve got no appliances in this place at all. My son used to have a low bed, but now he has a hospital cot, which is high. But I haven’t got an appliance to get my child up from a small chair to the cot. And when you try lifting him out of the chair he gets one leg caught round your neck. He holds himself stiff, you see. The Social Services can’t help me, it comes under the Health Department.

 

I’ve got a bath, but I can’t get him in because it’s too low, so I have to give him a blanket bath. I really needed a shower, but I can’t even get a board across the bath. In our old house I waited 18 months for them to come and put a board on my bath. When a thing like that is essential, you expect them to come up and do it, don’t you?

 

He has a chair, an old one from the appliance centre, but it’s literally falling to pieces. I’d be frightened to death if I took him out in this chair. If I do anything he’s got to stay here until I come back from the shops. But the last time they told me I was having a chair specially made was 14 years ago!

 

I have to pay for him to stay at the hostel weekends. He’s had 10 days now. That money’s mounting up. It’s going to be about £38 I’ve got to pay in. I pay his dinner money for the week and his transport: he goes by ambulance. Then each rubber pants costs me £1.14. I could use a pair a day, but I have to make do, because I can’t afford them. They do supply six or seven pairs a year, and paddi pads. You get the money, but by the time you’ve paid out, paid your rent and everything he needs, you’ve got nothing left. When you only live on supplementary pension you can’t get him things.

 

Everything I’ve been promised for my son has never materialised, not even in the Year of the Disabled. Though we did get this house. But I’m not entitled to a phone, because I’m in a built-up area.

 

He didn’t ask to come into the world and he didn’t ask to be like that. I wouldn’t let him go. I wouldn’t part with him because I want my son. Ever since he was a baby they’ve said, “Put him away, put him away”. I think they think, well, you’re daft yourself, for keeping them. That’s the attitude. I don’t think we’re given enough consideration. Not only the children, but the people who look after them as well. You’ve no backup, no real support. You don’t know whether you’re coming or going in the end.

 

Since this interview the son has received a new chair.

 

Single Parent with Two Children. Council Tenant.

 

I needed to improve my English. That is the main reason I wanted to go to college. If I had had a nursery, I could have gone. I asked the Social Services. They were terrible. I find it very very hard to get any help from them. I think they treat Whitehawk people differently. Maybe because there are a lot of problems here. If you need something, they don’t believe you.

 

In my experience, I went through a depression because I am totally on my own. No help. No relatives. No friends. And because I am 24 hours with the kids. My child is ready for a nursery. She needs it. She’s bored when she’s only with me. It was impossible to get a job, so I tried to get education. If you have exams, maybe you can get a job.

 

I asked for a nursery. They said because of the cutbacks there were no places. But I don’t believe it would ever have been possible for me. And you can’t get a job without a nursery, because they ask you. “Who will look after the children?” etc. Without a job I can’t pay for a nursery. So it’s a vicious circle, it is really.

 

They did help a little bit for a few months last year. They helped my youngest go to a day nursery. They paid some, and I paid some. Then suddenly they said they can’t help any more. The money was stopped just like that, and I had already paid college.

 

I do think sometimes it is because I am not English. I think there is discrimination everywhere. My eldest girl is six now, and in school she has a lot of problems: “Go home, Blacky”, and things like that. She gets upset. People, strangers, ask me, “Are they yours, or did you adopt them?” I say they’re mine. They look strange.

 

But there’s racism in the Social Services and in the Nursery School. I asked the headmistress ages ago. She promised me a place after Christmas. Then she gave it to someone else.

 

But the cuts have made a lot of difference. A lot of families like me, they are suffering. I am crossing my fingers for the next election. It may not be a miracle, but it should be a bit better.

 

I do go to college part-time now, but I have to take my daughter to a different place every day. To a friend, mostly, or occasionally to a childminder. But childminders are too expensive. There is some reduction at the college for unemployed people, but exams cost money, and books and travel. It’s very difficult. I enrolled for four ‘O’ levels. I study after they go to bed, but my eyes drop.

 

I can’t ask Social Services for anything any more. I always pray I’ll never need them. I try to do everything myself. I get £26 to live on, plus family allowance. I think there should be special allowances for single parents. My husband should pay £5 per child to Social Security. But he doesn’t pay it.

 

They should help women, especially single women. They seem to want women just to be scrubbing and cleaning. Why do you think a woman should stay at home? She doesn’t make the kids on her own. Why does the man have to be king? Women have the right as human beings to choose.

 

East Brighton Residents Association Secretary. Father of Four Children. Taxi Driver.

 

85% of Council stock in Brighton is sub-standard. Some of the conditions that Council tenants are living in are even worse than bedsits. A good 50% suffer from dampness. If the Council had done what they should have done and been a good landlord, they should have carried out repairs and maintenance and we wouldn’t have seen the demolition of this Whitehawk estate. The houses would have been quite sound enough to modernise. We know for a fact they don’t want council property, because it is a Tory-controlled Council. It’s a thorn in their side. All they do when tenants complain is fob them off with excuses.

 

One of the major issues we are facing now is the new rent increases which took effect in April 1982. It was a £2.90 rent increase and with the increase in rates which invariably follows, it came to around £3.50 a week more. The rents on the old properties and even on these new ones have gone up 160% in the last 18 months, and with another lot on top, the rents have trebled. It’s the old Tory ploy: they force up the rents and then people start thinking it would be just as cheap to buy.

 

For instance the rent of my house is £38 a week and with the increase it will be over £40 a week. It’s getting pretty near to a figure where you could buy it. When they get round to finishing Whitehawk, and they get the extra 600 units, half the houses built will have been sold, so they won’t gain 600, they might have lost 700.

 

Their long-term policy is that they don’t want council housing as such. I don’t think they’re silly enough to think they don’t need municipal houses. There’ll be more people like the Guinness Trust Housing Association running areas with the backing of the local authorities. This is what they’ve done in Whitehawk. With the rent increases, more people are forced to go into a rebate system. A lot of elderly people will not claim rebates when they should get them. Not only rebates, but also some supplementary benefit on their pensions. How these people are managing, I don’t know.

 

In this new development they are building some bungalows designed for the disabled. But what are they doing for the partially disabled? I had one case of a gentleman down in Whitehawk Road whose house has now gone. He was a very bad case. The local authority had done nothing for him. The handrail on his staircase had come away. He could not have a bath because he couldn’t get in, and if he did get in, he couldn’t get out. His wife couldn’t help him because she was elderly.

 

There is no housing at all for single people on the estate; I feel very strongly that there should be. I believe that the Council feel the Council tenant has got no feelings, and we shouldn’t create a fuss. We wanted to set up an adventure playground on some empty ground over the back. We would provide the labour. They said no.

 

I have found, over the years, that the basic problem is ignorance, and the ignorance is the fault of the authority because they’ve kept people in ignorance. What’s happening now, which the authority doesn’t like, is that people are beginning to take note of what’s going on, becoming aware and saying, “This is not good enough”. I think this will gather momentum. They start talking about building a new Brighton hotel – where’s the money coming from for that? They’ll find the money but they don’t even look after the housing or the tenants they have got.

 

I remember when we had a big conflict about the selling-off of part of Whitehawk. We went down to the Council chamber for the final decision. One man stood up, John Leach, and he said he couldn’t understand why the tenants in Whitehawk were creating such a fuss about having private property built with council housing. He said it would ‘socially uplift’ the area. Another councillor said the people of Whitehawk were ‘illiterate’. When Coun. Leach was chairman of the Housing Committee he was invited to no less than 12 meetings of residents and several EBRA (East Brighton Residents Association) meetings. Every time we got an excuse …

 

We would like to see a couple of our members on the committee, actually making decisions about what goes on in our area. It would be nice to see this right across the town, because the people then would get what they really need. If the Council would only open the doors a little bit more and say, “You’re responsible, we’ll allow you to come along and discuss policy on planning …” Who better would know what sort of house to build than a tenant? Since this interview we did get two of our committee onto a working party with councillors. Now they refuse to speak with EBRA because we do not agree with their tenants’ consultation document. They produced this in response to Government guidelines under the 1980 Housing Act. It asks for names and addresses of all EBRA members to be shown to the Local Authority. But why should we?

 

They know what we are saying is right. It’s what central government policy is that makes the block between the Council and the tenants.

 

A Group of Teenagers in a Brighton Youth Club Talk to Us.

 

– So you think the kids should have more of a say in what goes on at school?

 

The kids should have as much of a say as they do, but they have all of it – like in my school we don’t have any meetings, just the teachers, and there’s a parents’ meeting every six months.

 

– What if they let you have a meeting every week for the kids to decide what they wanted?

 

It isn’t worth having the meetings anyway because they don’t get anything done about it.

 

– But if you could have a meeting and they’d actually take some notice?

 

Hairdryers … because after you’ve been swimming you have to come out into the freezing cold air and you get colds that way and then they moan at you because you aren’t doing swimming.

 

– What about lunch time, what do you do then? Do you have anywhere to go?

 

In the bogs. In the bogs or you have to stay outside.

 

And then you get thrown out of there.

 

Go up the woods and have a fag!

 

I think we should have common rooms … with table tennis and snooker.

 

They won’t let us have it because they think it’s all going to be broken.

 

It would be alright if you were allowed to go out of the school grounds at break and everything.

 

– They treat you a bit like you’re in prison don’t they?

 

Yeah, they treat you like as if you’re in Broadmoor.

 

If we went out on nature trips and that, instead of being in classrooms all the time, it might help if we actually went out and saw what they were talking about, but you don’t.

 

We don’t get too many trips, do we?

 

No, all the trips we do is what we can’t afford, to Switzerland and what have you.

 

Costs a bloody bomb, doesn’t it.

 

– What do you think about school dinners?

 

Oh God, they’re horrible.

 

It’s either cold or runny or they haven’t got it.

 

It’s never properly cooked.

 

– What do you do, have a packed lunch, or school dinner?

 

Come home, or sometimes I stay.

 

Some of it’s alright – at our school it’s a cafeteria.

 

Yeah, but that’s just as bad anyway.

 

The chips are all skinny and cold.

 

And they’re 14p a portion and you don’t get many.

 

And the sausages are all screwed up and burnt, only that big, for 15p.

 

– If you’re paying for something it should be worth the money shouldn’t it?

 

It should be hot and properly cooked, like the doughnuts …

 

– What about travelling to school and back?

 

It’s only along there, I walk.

 

It costs my Mum for me and my brother £10 a week. You’d think that they’d help with the price of actually coming to school.

 

It’s like out of the funds, like fund-raising for the school and that, half of the things they get we don’t get to see or use.

 

No you don’t, you don’t see them after.

 

The only thing we see was that shed they built for those big mattresses and the high jump.

 

– And where did the money for that come from?

 

Off us.

 

Sponsored hockey and football matches.

 

– Do you help decide what they spend it on?

 

No, not really. They just say: “We’re putting it on what we think is needed”.

 

They don’t bother to ask us.

 

They need School Unions.

 

– What do you think about that idea?

 

That don’t do nothing. They don’t take any notice of you if you do anything like that.

 

– What do you think would make them take some notice?

 

Going on strike, walk out of school.

 

Yeah, but all the kids wouldn’t go.

 

– What if you organised a successful strike and the teachers came and said to you OK, what do you want, we’ll give it to you, what would your demands be?

 

No homework.

 

That’s silly, homework, you go to school for six hours and then you come home and have to do homework for an hour.

 

Kids should be paid to go to school as well.

 

Longer dinner hour.

 

And a longer break.

 

And somewhere to stand when it’s raining in break.

 

– What do you think you should get out of school?

 

You should learn the basic things, what you need in life.

 

A bit of maths, not all that algebra and stuff they do, it’s silly! You don’t need it.

 

Sex Education.

 

They should teach us about how to pay bills, how to get mortgages and all that crap.

 

I don’t want a job anyway, I’ll probably end up on the dole.

 

They do more writing than they do practicals.

 

They just write about it, they don’t show you.

 

Like what’s the use of me doing French? I’m never going to go to France.

 

Pointless really. You have to do German and everything.

 

Yeah, that’s like me, never going to get anywhere.

 

– What about things like History and Geography?

 

You’re still not learning anything in that.

 

At our school we just learn the same thing over and over again.

 

English and Maths – that’s the only thing you need for a job.

 

Geography, you do things about maps don’t you? That’s alright because maps could help you reach a job.

 

– What about leaving school, do you worry about that?

 

Yeah, we leave too late, I want to leave now.

 

You wait, you leave school and then you can’t get a job, then you’ll be lumbered. Like me, when I left school I couldn’t get a job.

 

Oh shut up Bob, Grandad!

 

– He’s right, that is something to worry about.

 

Yeah, I know.

 

– Do you think, the people on the dole, that it’s their fault?

 

No, it ain’t.

 

Some of them.

 

Don’t be silly!

 

Some of them don’t want a job, do they?

 

No, that isn’t the right people when they go on about that. They don’t talk about school leavers, they don’t count.

 

– Do you ever worry about the future?

 

Yeah, we’re going to get bombed by an atom bomb I don’t worry about it, though.

 

I do. I think its frightening.

 

Yeah, reckon it’ll happen anyway.

 

Chapter 2

 

The Arguments against Local Spending

 

LOCAL council spending is attacked as part of a general argument against public spending by the State. The State, it is argued, has got out of control. In 1910 State spending amounted to only 12% of national production. By 1951 it was up to 40%, where it stabilised until the late 1960s. But by 1976 it had grown to 51%, more than half of national production. A considerable part of the rise was due to local authorities. During the 1960s for instance, while national production grew by 80%, and state spending by 120%, local council spending went up by 170%. At the beginning of the 1960s, local spending was 10% of all national production. By 1975 its share had almost doubled to 19%. The local share in State spending rose from a quarter to a third over the same period.

 

These are the statistics that are used in every article, book and speech attacking local government. They are the basis for saying that local councils have been ‘spendthrift’ and ‘profligate’. It is not just that it has grown, but that it has grown much faster than overall state spending, and faster still than the national economy.

 

Why should this matter? Why shouldn’t a country decide to spend more on its public services – like schools and health – and less on its private consumption? There is, after all, a limit to the food you can eat, or the amount you can spend on your house or car. Once our basic needs are catered for, should we not give a greater part of what we earn to providing schools for our children, and help for the elderly and the sick?

 

The case against public spending has two parts. The first is about growth. The State is seen as ‘crowding out’ private capital. The second is about inflation.

 

Mrs Thatcher talked about growth in a parliamentary speech in July 1978:

 

“If our objective is to have a prosperous and expanding economy, we must recognise that high public spending, as a proportion of GNP, very quickly kills growth … We have to remember that governments have no money at all. Every penny they take is taken from the productive sector of the economy in order to transfer it to the unproductive part of it. That is one of the great causes of our problems, because this government have increased the unproductive sector and diminished the productive sector, so that during the lifetime of this government we have had virtually no growth at all.”

Hansard, 25.7.78, col.1400

 

Mrs Thatcher thinks value is produced by workers in the private sector. If some of it is transferred to the State, there will be that much less to be re-invested in the private sector. It is the private sector which is ‘the goose that lays the golden egg’.

 

One way this has shown up in the British economy is in the employment of labour. Between 1966 and 1973 employment in those industries which sell what they produce on the market fell by 625,000. This was at a time when the national economy grew by more than a quarter. At the same time employment in the non-market sector, financed by taxes, increased by 810,000 jobs. Fewer workers were producing value from which more state workers had to be paid.

 

The argument then runs: taxes had to be raised to finance the growth of the State. Workers had to bargain with employers to raise wages just to keep take-home pay the same. So the higher taxes really came out of profits, and the decline of profits led to companies cutting investment and cutting those jobs which produce value.

 

If the workers fail to get an increase in their wages, and the tax comes out of wages, the increase in state spending will mean we have less to spend out of our wages on private purchases. This means a decline in markets for private firms and less chance for firms to grow.

 

The remedy then is simple. Cut taxes, increase profits, investment will pick up again, employing more value-producing workers, from which we will once more be able to take a portion to expand the unproductive state sector. According to this line of argument, therefore, it is the State which is at the heart of Britain’s problem, particularly those state services which have to be paid for through tax. A glance at the chart will show why this argument concentrates much of its attack on local government.

 

Of those services which grew faster than the value-producing part of the economy, five were the responsibility of local councils: housing, much of roads and transport, environmental services (including dustbin collection, cremations, planning), education and finally the social services element in health spending. So, if social security and debt payments are difficult to reduce, cutting back on state spending means cutting back above all on local government spending.

 

As an alternative to raising taxes, the State (and local councils) can borrow what they need. Every year there tends to be a gap between what the State spends and what it raises in taxes. This gap is called the Public Sector Borrowing Requirement (or PSBR) and shows by how much it is going to have to increase the National Debt. In the 1970s the growth of state spending was linked to a big increase in the PSBR as a share of national production. In 1969/70 the Government was actually paying off private lenders out of the surplus it had from its taxes. By the end of the decade it was having to borrow £10,000 million a year. Where did this money come from? Either it came from the savings of British workers or companies or it could be borrowed from abroad.

 

If it came from the savings of the British workers or companies, the money made available to the State meant that these sums were not available for private industry. What the State gained, private industry lost. Therefore, even if private industry had wanted to invest, they would have had less capital from the money market to do so. Worse still, some companies might regard the high interest rates paid by the government as so attractive that they would lend their own funds to the State rather than re-invest them in their businesses.

 

If the money comes from abroad, this makes it harder for British industry to compete. This is because the inflow of foreign money tends to drive up the rate of exchange. This in turn makes it harder for British industry to export, or to compete with cheaper imports. So even where government borrowing does not directly take away British capital, it discourages new investment by making Britain’s competitiveness weaker through this high exchange rate.

 

All these arguments add up to the same thing. If the State expands its services (net of any income it gains) faster than the private economy, then it will ‘crowd out’ the private sector by:

 

– taking away labour from private industry

 

– reducing consumer demand for private industry’s products

 

– taking away capital from private investment

 

– worsening private capital’s competitive position by raising the exchange rate.

 

Since Mrs Thatcher’s government came to power in May 1979, yet another case has been added to the above. It is a case which sees the State not just as a cause of slow growth, but as the major factor behind inflation.

 

Again, government borrowing is at the centre of the issue. This is how Nigel Lawson, one of Geoffrey Howe’s deputy Ministers, put it in January 1980:

 

“Let me start with two simple facts. The first is a statistic. The PSBR is at present about 4½ % of total gross domestic product (GDP) – compared with an average of only 2½ % in the 1960s. The second is an economic relationship. That is, the PSBR and the growth of the money supply and interest rates are very closely related. Too high a PSBR requires either that the Government borrow heavily from the banks – which adds directly to the money supply – or, failing this, that it borrows from individuals and institutions, but at ever-increasing rates of interest, which place an unacceptable squeeze on the private sector”.

Select Committee, p.114.

 

We have already discussed the ‘squeeze’ – that is Nigel Lawson’s version of ‘crowding out’. This takes place when the Government borrows from individuals (through National Savings, for example) or from large institutions (such as the pension funds, or insurance companies). To the latter the Government issues bonds, which promise to pay the private lenders a given rate of interest in exchange for a loan for, say, 15 or 20 years.

 

But for some of its borrowing the Government goes straight to the banks. They run up their overdraft as it were, and in exchange give the banks an IOU called a Treasury Bill. If we, as individuals, managed to borrow from a bank, we would usually have to provide some security – but for the Government a bit of paper is enough, since the banks know that the Government can always print money or raise taxes to pay off its debts. These Treasury Bills are then really the same as cash, and this allows the banks to increase their lending to private capital. They expand the quantity of money in the economy, since not only have they lent a given amount to the government for it to spend, they then lend the same or more to private borrowers on the strength of the IOUs that the Government has given over.

 

That is the first step. The second is that if the amount of money increases in the economy – everything else remaining the same – more ‘money demand’ will be chasing the same number of goods or workers and, therefore, prices will rise. This is inflation.

 

Policy then is straightforward. Cut the amount of government borrowing from the banks and you cut off the main ingredient which is fuelling inflation. In the words of the financiers, you must “balance the budget”. In the words of Mrs Thatcher, “you must cut back spending to what you earn. Good housekeeping means not having to borrow. It shows that governments, like a small grocer’s household, should live within their means”.

 

Conclusion

 

These are the facts and the arguments which have led to the present insistent attack on state spending, and particularly on local government. We can summarise the main charges against council services as follows:

 

– they have increased much faster than the national economy. In this sense we have been consuming more than we earn. We have been ‘having a party’ which must now be ended.

 

– councils are at fault for having allowed spending to run away with itself. They are blamed for inefficiency, bureaucracy, giving way too easily to the wishes of local electors, in order to get votes.

 

– councils have employed too much labour, thus taking it away from the private productive sector.

 

– to cover this spending, councils have raised rates and taxes which has decreased the freedom of the individual to choose what he or she wants to consume. Even worse, it has taken away the will to work.

 

– they have increasingly resorted to borrowing on the money market, either taking scarce capital away from the private sector, or increasing the money supply through borrowing from the banks.

 

This is their case. It was one which was put forward by Labour Ministers like Crosland and Healey, as much as by Tory Ministers like Barber. Now it is made by the hard right of the Thatcher Government. The first round of cuts were introduced in December 1973 at the end of Heath’s period in office. They were developed in 1975 and 1976 by Labour Chancellors. Under Thatcher cutting spending has become the main political and economic issue. Their insistence that their way of seeing the situation is correct has now paralysed many of us who have experienced State spending entirely differently.

 

Let us begin then with our two local Councils and see if official statistics show them to have followed the pattern for all local authorities, and if so, what these statistics actually say.

 

Chapter 3

 

Services and Expenditure: a Tale of Two Councils

 

THE immediate task was to find the relevant statistics. We went first to the Reference Section of the Brighton Public Library – a model of what a public service should be. Here are perhaps 100 different periodicals, encyclopaedias, directories, whole shelves of minutes and reports of this public committee or that. Most could not be afforded individually, and would only be used occasionally. But collectively – for a tiny sum – we can have them available all the year round. We explained at the issue desk what we were looking for.

 

What we wanted to find out was simple. How had total expenditure for Brighton and East Sussex County Councils changed since the mid ’60s? These presumably were the figures which, taken for each council in Britain, went to make up the national statistics on which their (the Government’s) view was based. We could then break down these local figures to see how particular services had fared, and look to see how the expenditures compared with actual services as we experienced them.

 

Since these facts had been at the centre of the national political debate, we hoped that our Councils had produced the statistics. But the answer was no. Indeed, we found later that not a single study of an individual council had been done on this issue – certainly not one that has been published. The reason was soon clear. From the volumes of books that the librarian brought from the reserve stacks – mainly annual accounts of Council expenditure – the crucial figures were either missing or hard to find.

 

The volumes with which Councillors are most concerned are estimates, but we needed actual expenditures which it turned out in recent years were often very different from what had been planned. Then in the mid-’60s the figures for total expenditure included all police spending. In 1968 a new Sussex police force was established and afterwards only the ratepayers’ contributions to total costs were included. The same thing happened later for housing and the local bus service, so that again the total figures had to be recalculated. Then there was a regular juggling of Committees. Social Services took over part of the Health Committee, and the Children’s Committee. Parks became Amenities, and then split off again to Parks. Most complicated of all, in 1974 Local Government re-organisation removed a whole set of responsibilities from Brighton Borough Council, giving some to the new Health Authorities, and some to an enlarged County Council.

 

With patience you can get over these changes. You can take children’s expenditure from one heading and add it to another so that you compare like with like. But sometimes no figures exist. Brighton Council did not say how much had been invested for four years in the early ’70s. Sometimes only expenditures net of income are given, and sometimes information is intentionally withheld. For example, the Annual Reports of the Sussex Police Authority are full of facts on crime, on methods, on celebrated visitors, and staffing. But they contain not one figure on their general finances, because of a conscious policy of restriction by the Chief Constable. Nor, before 1974, did either Council regularly publish employment figures.

 

The simple checking of our local Councils’ spending was, therefore, far from simple. Some facts – particularly for East Sussex – have been supplied by helpful Council officials, but others appear not to be available at all, notably those on employment before 1974. Given the attacks on the increased employment by local councils, it seems strange that there are no publicly available figures on how Council employment has moved over the last 15 years.

 

In the beginning, then, was hunting and gathering. Brighton started off as the larger spender, £17 million in 1965 as against just under £16m for East Sussex. But then East Sussex overtakes. By 1974 it was spending £52m as against Brighton’s £34m, and by 1979 £166m as against Brighton’s £32m. In terms of spending, East Sussex is now five times the size of Brighton.

 

Part of this, but only part, is the result of the re-organisation of local government in 1974. Education, Social Services, some Planning and some Highways were taken from Brighton and transferred (along with the same departments from Eastbourne and Hastings) to the County. Brighton’s Health Department was shifted to the Area Health Authority. Brighton’s budget fell by £15m, that of East Sussex rose by £43m.

 

Leaving aside the effects of re-organisation, Table 1 shows that expenditure in both Councils increased, but much faster in East Sussex than Brighton, even though they started from the same level.

 

Table 1

 

Current prices

Increases in £m

            ESCC  BDC

 

1965/74           35        17

1975/79           71        11

1979/82           75        16

 

Source: Council Statistics.

 

Here we come to the first difficulty in interpreting these figures. What they measure is the money actually paid out by the two Councils. They take no account of inflation. But if we want to see how Council spending changes, clearly we need it in ‘real’ terms, without the effects of inflation. This is where the problem comes. Different things inflate at different rates. The price of oil, for example, has risen much faster than the price of television sets. The price of land has also risen rapidly, and land is an important item in Council house building. The Government statisticians produce an average index of inflation (called the index of Gross Domestic Product or GDP). They calculated, for example, that the average price of all goods and services in the British economy had risen 4¾ times in the 20 year period between 1959 and 1979. Something which cost £4.74 in 1979 would have cost £1 then. The statisticians also produce a special index for the rate of inflation for those things bought by the Government. What is important for us is that these Government purchases have risen in price faster than the average rate of inflation, by more than six times in that period between 1959 and 1979. So, for something the Government bought for £1 in 1959 it would in 1979 have to pay £6.15, whereas the average for the economy was £4.74. It appears that the Government is spending more than the private economy, but this is simply because the prices of its purchases are rising faster than those of the private sector.

 

To see how real Council expenditure has been moving, we should therefore adjust the actual payments to take account of the rate of inflation of goods and services purchased by the public sector. The results are startling, and are shown in Table 2.

 

Table 2

 

Percentage changes in Council spending after actual values have been deflated by the Government inflation index (1975 = 100)

 

            ESCC  BDC

1965/74 61      – 4

1975/79 -0.2    -10

1979/82 -5       – 3

 

Source: Council Statistics.

 

Whereas actual expenditures went up for both Councils in all periods, real expenditure fell for Brighton between 1965 and 1974, and for both Councils from 1975 onwards. For Brighton there has been no long-run tendency to increase Council spending. It has actually fallen. For East Sussex, there was a significant rise in the first period, but a fall later.

 

Let us now look more closely at the early period for East Sussex. The £30 million increase in real terms represents a 61% increase between 1965 and 1974, more than twice the rise in the national economy as a whole (30%). Again, however, we need to adjust the figures, since this was the one period when there was a rapid growth of population. The population of the administrative County of East Sussex went up from 400,000 to 456,000 over the decade. If we take Council spending per head of population, we find that the spending increased by 43%, still faster than the national economy, but not by much.

 

The pattern is shown in Chart 1. Until 1971, East Sussex spending per person was rising in line with GDP, but then came Mr Heath’s U-turn – encouraging government spending. Since 1975 the fall in East Sussex spending, with a stable population, means that the per capita increase over the whole period is now almost equal to the expansion of the general economy. In the case of Brighton – whose population has tended to fall slightly from 1975 – per capita spending has fallen both absolutely, and relatively to the rise in GDP.

 

Two further points need to be made about these general expenditure figures. First, if we want to know what demands local council spending is making on the country’s material resources (its land, labour and machines) then we should deduct two purely financial factors:

 

1. Debt charges. This includes both repayment of the loan, and the interest, and is part of a purely financial relationship between a council and the owners of money capital. It is only when money is spent that it becomes a claim on the country’s material resources. The charge against public spending is that too many of the country’s workers, raw materials and pieces of equipment are being used to produce public services, at the expense of those same resources being used by private industry. This is in part what is meant by the public sector ‘crowding out’ the private sector. But money is not a material resource of that kind. It is a bit of paper or an entry in a ledger. The fact that a council’s spending rises because the cost of its monetary borrowing rises, does not mean that it is using more material resources, only that the money-lenders are increasing their returns (which they may then spend on real goods) at the expense of the public.

 

In the case of East Sussex, debt charges are relatively insignificant and they have changed little over the decade (they were 6.4% of gross spending in 1969/70 and an estimated 6.3% in 1979/80). In Brighton, however, debt is much more significant, accounting for 30% of total spending in 1978/79. Increases in interest rates can, therefore, have a major effect on the level of council spending, without any change taking place in council expenditure on material resources.

 

1. Tax paid to the government by Councils. Local authorities were exempted from Selective Employment Tax (SET), and can reclaim Value Added Tax (VAT), but in the earlier period they had to pay purchase taxes, and have always paid the employers’ contribution (and the surcharge) for national insurance on behalf of their employees. If the proportion of council spending that goes on these forms of re-cycling cash to the central government grows over time, then real council spending will correspondingly fall. The problem is to get the figures. Fortunately the East Sussex Treasurer’s Department has produced figures which allow us to see the significance of this point. In 1969 their contribution to National Insurance amounted to 1.7% of total spending. By 1977/78 it had risen to 4.1%. The effect of this on total real spending by East Sussex is that the per capita increase from 1965 to 1979 was 40.5%, compared with the growth of the national economy of 39%.

 

The second general point is that national statistics almost certainly overstate the increase in local council spending in relation to the national economy. The reason is this. National production is, in principle, measured by the value of what is produced. For anything which is sold, the statisticians take the price, add all the prices up, and this gives the overall value of production. In the case of local councils, (and some other parts of the State), this procedure doesn’t work, because the services by and large are not sold. Therefore the monetary values of local council services are estimated on the basis of the costs of the service, not the value of the output.

 

Why should this make a difference? Mainly because local council services tend to be labour intensive. For example, wages account for two-thirds of East Sussex expenditure on goods and services. This reflects the fact that it is much more difficult to raise productivity in the classroom, for example, than it is in a modern factory which is constantly replacing people by machines. Now, since the value of any product reflects the labour time embodied in it, any industry which increases its labour productivity will thereby reduce the value of its individual product. That is why the real price of televisions has fallen over the past 15 years, because it takes less labour to produce them now.

 

How does all this work out in the calculation of national production? Local council services will hold their value. With no productivity gains, they will employ the same amount of labour to produce the same output. But in other sectors, whether of cars or of steel, the same output can be produced with fewer people. That means the value of the output will fall even though the same quantity of physical products are being produced. In terms of value then, the local council sector will appear to be producing more value, even though the physical production of the total economy remains the same.

 

In practice, it is likely that the high productivity sectors have increased their physical outputs much more than the local council sector, even though local council sectors might appear to be accounting for a greater value of production. The fact that East Sussex spending per head has risen at virtually the same rate as the national economy (measured in the way just described) means that the outputs of East Sussex are almost certainly a smaller proportion of total physical output of the economy.

 

This distinction between monetary values and physical products (which we can call ‘use values’) is of the greatest importance, for it may lead us towards an answer to the problem of the first two chapters. The argument of monetarists, economists and successive governments against local councils have been based on statistics of monetary values. We have shown that, even in monetary values, there has been no tendency for per capita spending in East Sussex to rise relative to the growth of the national economy, and that in Brighton it has actually fallen. But our experience of the two Councils has been of the poverty of their physical outputs. Our evidence was experience. In this chapter our evidence has been confined to monetary statistics. What we have established is that these statistics are produced in such a way that it is perfectly possible for the monetary values of local councils to rise as a proportion of the national economy, whilst their physical output is declining.

 

Figures are usually much harder to find on physical outputs (‘use values’) than on market values. In the next two chapters we will look at how particular services have developed with the ‘use value’ figures which are available.

 

Chapter 4

 

Have the Services Improved? The Case of East Sussex

 

LET us begin by getting a sense of the proportions. We have shown the main services provided by East Sussex, their significance in the overall County budget, and their rates of growth before and after re-organisation. These figures show monetary values, but they give us a first guide to what may have happened to our actual services.

 

A number of points become immediately clear:

 

1. Highways

 

Expenditure on roads, their re-building and maintenance, rose slowly in the first period. It dropped dramatically in the second period. Current spending fell by 37% since re-organisation. Capital investment fell by a third between 1975/6 and 1978/9. The savings have not been made on staff. The number of administrators actually rose from 323 to 401 in the four years to 1979, as did the number of roadmen and manual workers from 321 to 397. What has fallen is the spending on materials and contracts for the improvement of roads, as well as spending on school crossing patrols.

 

In 1975 there were 58 lollipop patrols. By 1980 the number had fallen to 46. The actual number of people involved is in fact much higher than this since the Council figures are for what they call ‘full-time equivalents’. Since lollipop patrols are for only a short period every day, the actual decline of this service is much greater.

 

1. Planning

 

Planning grew significantly in the first period but has been declining in the second. The completion of the County Structure Plan meant that the Department had excess capacity (in fact its staff has fallen from 131 to 101 over the last six years).

 

iii. Libraries

 

Libraries also grew in the first period but declined in the second. The stock of books increased steadily between 1965 and 1974, but has fallen since then. Overall, between 1965 and 1979 the stock of books per head of population increased by 12%, less than a third of the rate of increase in the national economy. Similarly in the early period, the number of libraries and library centres increased, leading to a 24% increase in books issued per head. The upward trend in these ‘service points’ has now been reversed.

 

1. Police

 

The decline in ‘other’ expenditure in the first period is largely accounted for by a decline in the figure for the Police. This is because the Sussex police forces were re-organised in 1968 into a single authority covering the whole of Sussex. Whereas the figure for 1965 indicated total expenditure, that for 1974 shows only East Sussex’s net contribution.

 

Other figures show that in fact spending on the Police has risen rapidly since the new County force was set up. From 1968/9 to 1979/80 gross spending of the Sussex police force rose by 51% in real terms, with the number of police expanding by 25% (from 2,221 in 1968 to 2,777 at the end of 1979). By 1982 they had increased further to 2,829.

 

1. Water

 

The increase in ‘other’ expenditure after re-organisation is largely accounted for by an increased payment to the Southern Water Authority. In real terms this body, which covers Hampshire, the Isle of Wight, the whole of Sussex, and Kent, has only increased its total current spending by 5% between 1974/5 and 1978/9, and its capital spending has actually declined. But a change in the system of finance has meant a much larger contribution by East Sussex.

 

1. Education and Social Services

 

Education and Social Services make up the bulk of Council spending, increasing from 63% of the Council budget in 1965 to 76% in 1979, where it has stabilised.

 

Overall, then, one service – Highways – has shown a steady decline. Another, the Police, has shown a steady increase over the last decade. Two others, Planning and the Library Service, appear to have expanded in both monetary value and real services during the first period, but to have declined strikingly in the second. In all these cases, material services and their monetary values appear to move in the same direction. A decrease in library spending goes along with a reduction of services, though not necessarily in the same proportion. Only in the case of water and sewerage does the increased cost of the service after 1974 represent a purely financial rather than a material expansion.

 

The decisive spenders, however, are Education and Social Services. They account for 85% of the increases in current expenditure that did occur in both the first and second periods.

 

To what extent does the growth in monetary values mean a growth in actual services? We will look at each in turn.

 

Education

 

Over the whole period 1965-79 the Education budget went up from £8 million to £100 million, a twelvefold increase. In real terms (that is, taking account of inflation) it went up by 177%, of which 103% took place at the time of Local Government re-organisation. This was mainly because of the shift of responsibility for education from Brighton, Hastings and Eastbourne to the County Council at Lewes. Education alone accounted for more than two-thirds of the increase in County Council spending over the period.

 

Nine-tenths of education spending is on four things: primary schools, secondary schools, school milk and meals, and further education. Their growth in monetary terms (taking out the effects of inflation) is shown in Table 1. Table 2 changes these figures into spending per student.

 

Table 1

 

Percentage growth in Education spending

 

                                    1965/74           1975/79           1979/82             

Primary Schooling      63        -4         -3

Secondary Schooling  38        8          -3

Milk and Meals           31        -2         -29

Further Education       63        92        -1

All Education

(incl Milk and Meals) 58        7          -7

 

Table 2

 

Percentage growth in per capita Education spending

 

                                    1965/74           1975/79           1979/82           1965/82             

Primary Schooling      13        3          5          33

Secondary Schooling  4          -4         -2         -13

Milk and Meals           -6         -4         -20       -26

All Schools

(incl Milk and Meals) 4          0          -0.2      2

 

What these extraordinary figures say is that per capita spending on school children has hardly risen in the 17-year period since 1964/5 (a mere 2%). The rise in primary school spending (33% over the full period) is balanced by decreases in secondary school budgets (down 12%) and in milk and meals (down by 26%).

 

The decline in the milk and meals service is particularly striking. In 1964/5 an average of 137 meals were served during the year for each pupil. In 1968 milk was stopped for secondary school children. In 1971 no milk was to be given to children over seven years old. By 1973 the average number of meals served per year to each child was 130, and the price of meals had risen by 4%. The decline continued until in the last few years the service has been collapsing, with rising charges and falling standards leading to a sharp switch to packed lunches, particularly in secondary schools. This is one service where we can say for certain that there has been a decline in welfare provision.

 

In the case of the schools themselves the issue is more complicated. Much of the rise in school spending has been caused by an expansion of pupil numbers. The number of children at primary school went up by no less than 43% in the eight years from 1965. The number of secondary school children went up by a third. This reflected the baby boom of the 1960s, and the more rapid increase in numbers of children in East Sussex than for the country as a whole. The only part of the increase in spending which could be seen as an increase in welfare was that connected with the increase in the school leaving age to 16. This was a controversial measure not least because part of its logic was to reduce teenage unemployment. Certainly the County’s extra spending could in no way be called ‘profligacy’ since it now had to provide schooling for all 15 year olds by law.

 

A second way of showing the trends of educational service is by class size. The figures we have are for pupil-teacher ratios not the actual number of children in a class. Up to 1974 there were marked improvements in class sizes in Brighton, and the evidence suggests a similar trend in East Sussex. Since 1974 the County primary classes have improved (from 23.8 children per teacher in 1974/5 to 22.3 in 1981/82) but the secondary classes have worsened (from 17.2 to 17.3 over the same period).

 

The quality of education is not just about the size of classes. But smaller classes do help. From knowledge of our local schools, the increased proportion of staff has meant that more services can be offered: better remedial teaching, for example, or school visits. These improvements are precisely the ones that are being taken away in the present round of cuts.

 

Lastly there is the question of school size. The trends are shown in Table 3.

 

Table 3

 

Average number of pupils per school: East Sussex

 

Primary Secondary

1964/5 156      456

1972/3 214      756

1974/5 193      748

1978/9 221      1,073

 

Over the whole period primary schools have increased in size by nearly 50%. Secondary schools have more than doubled. The main argument for this trend is economic. Larger schools are said to be more cost efficient. There are economies in the use of school facilities, and in the specialisation of staff. These were the arguments used when the Education Authority proposed to amalgamate primary schools in the Queen’s Park area in the early 70s to make a four-form entry school of 600 children. The point we made then – and would make more generally in secondary as well as primary schooling – is that there are many diseconomies which do not show up in the account books. There are longer journeys to school for the children. There is the sheer size of a school which for younger children is daunting. The staff cannot know each child personally (the upper figure for this is probably 250 children). The larger the school, the more it depends on formal, often rigid systems of rules and regulations.

 

So the modest gains that have been made – particularly in primary schools – are offset by the losses resulting from the general increase in school size. The gains themselves have been small – much smaller than the general rise in the national economy. Many of them are being lost – along with adequate buildings, and classroom materials – as the result of the cuts. On the other hand, the pressure to expand school size for reasons of narrow budgetary economies is increasing. The educational costs of big schools and over-centralisation are rising too. Our local experience tells us this, even though it does not show up on the statistics.

 

By far the largest increase in Education spending has been in the field of Further Education (FE). In real terms it grew by 560% between 1965 and 1979. From 15% of the Education budget in 1965, it went up to more than a third. Its growth alone accounts for nearly half the increase in Education spending, and as much as 30% of the whole increase in Council spending. Does this reflect ‘real’ expansion of the service?

 

The first point is that a major part of the rise has occurred for purely administrative reasons. Before 1974 the County Council was only responsible for Lewes Technical College. After re-organisation it additionally took over Brighton Technical College, Brighton College of Art, Eastbourne College of Further Education, Eastbourne College of Art and Design, Hastings College of Further Education, the Colleges of Education in Eastbourne and Seaford (which were merged to form the East Sussex College of Higher Education) and finally Brighton Polytechnic, which was soon to merge with Brighton College of Education. Without Brighton Polytechnic, these new responsibilities immediately added nearly £7 million to East Sussex expenditure. By 1978 Brighton Polytechnic added a further £14 million. The addition of Brighton Polytechnic alone accounted for 10% of the increase in Council spending between 1965 and 1979.

 

Secondly, most of these Colleges appear to have grown only modestly over the whole period. The number of students at the four Brighton Colleges between 1968 and 1974 grew by only 18%. Costs grew by only 1%-12%, and the staff-student ratios all got worse. After re-organisation growth has also been modest. Total FE spending increased by only 15%, at a time when the birth bulge of the 1960s was leaving secondary school. So per capita increases would be much lower.

 

Thirdly, a portion of the increases has taken the form of student grants and contributions to other authorities. More than three quarters of the growth of the FE budget before re-organisation came under these heads. They have continued to expand at a faster than average rate after re-organisation. Grants and advances grew by 27% in real terms between 1975 and 1979, rose from 51% to 57% of total FE spending (excluding Brighton Polytechnic), and accounted for 92% of the real increase in the FE budget.

 

These so-called ‘transfer payments’ have different implications for our argument than expansions in, say, school education. To begin with they are closely monitored by the Government. Their growth reflects central government requirements of local authorities in the country as a whole. In no way can an expansion of student grants and ‘pool’ contributions be used as an argument for local government ‘profligacy’. Second, these payments are similar to a tax on the local budget, since they transfer cash to other spending bodies whose demands on ‘real resources’ have to be analysed independently of the way in which their expenditure is funded. For example, a Brighton student at Central London Polytechnic would have a grant paid by East Sussex to the Polytechnic which is funded by the Greater London Council. It would be perfectly possible for East Sussex contributions to other such bodies to rise, while these other bodies held their costs constant. Indeed, as we have seen in East Sussex, transfer payments have risen considerably faster than ‘real spending’ by the County on its own FE Colleges.

 

Finally, it is not at all clear who are the prime movers and the prime beneficiaries of the expansion of Further Education. Much of the stimulus for this expansion has come from industry. In the 1960s official reports urged an expansion of Higher Education on the grounds that ‘investment’ in Higher Education would yield a positive rate of return. This was necessary if British private industry was to maintain its competitiveness on world markets. Given these arguments, the same people cannot now ask us to accept their case that State spending in Higher Education is unproductive and a drain on private capital. Rather it is intimately linked to the expansion of private capital, and is clearly quite different from dustbin collection or spending on elderly people.

 

Social Services

 

Social Services are the other big area of growth in the East Sussex budget. In 1965 they made up only 8% of spending. They grew to 14% in 1979, and alone made up one sixth (17%) of the rise in County Council spending over the whole period.

 

Private industry regards this as money down the drain – £22 million in 1979 – as a deduction from funds that could be reinvested. From the point of view of their economy they are right. The retired, the abandoned children, the physically and mentally handicapped are by and large unproductive. The food they eat and the clothes they wear do mean one less machine here, less capital to invest abroad there. But to put it in this way is to see how distorted a lens is being used to examine our circumstances. If we look at it from our point of view, of the perspective of social economy, then to expand our support for the elderly and forgotten would be a mark of success not of failure. Indeed, if an economic system was so bent on expanding machines at the expense of elderly and handicapped people, might we not begin to look around at other systems, with different values more in accord with our own?

 

In Britain, the 40s and 50s were a time of geographical and occupational change. Extended families were split up. An increasing number of women went out to work. The elderly, the sick, and in some cases the young had to fend for themselves. Formerly the care of dependents had fallen squarely on the shoulders of women. As employers drew women into wage labour and as women looked for work to produce an adequate family income, there arose what we might call a ‘crisis of dependency’.

 

In some countries employers, having brought on such a crisis, contributed to its solution. They provided creches and day nurseries. They maintained homes for sick and disabled people, and so on. In this country the advances on this front during the war – nurseries, council restaurants – were closed soon after peace returned. Not until the late 60s and 70s did the acute needs of many sections of our society at last get recognised by the Government. In 1969 the Children and Young Persons Act was passed, in 1970 the Chronically Sick and Disabled Persons Act; the following year the White Paper on the Mentally Handicapped, and in 1975 a further Children’s Act.

 

Just as the first Industrial Revolution had produced social devastation which was only recognised in the latter part of the 19th century, so the second Industrial Revolution produced new forms of devastation whose private character was patiently revealed by a succession of research reports in the 1960s.

 

East Sussex has been a leading site of the new devastation. Whereas the 19th century brought country people to the infernos of the northern towns, now city people are moving south in search of jobs. The result is striking. As a recent report put it, “Urban deprivation that exists in some parts of East Sussex is as severe, if not more so, as that experienced by towns and cities traditionally associated in the public mind as being deprived areas”.

 

The Department of the Environment produced a report on the subject based on the 1971 Census. They surveyed 1,102 local authorities, and from them identified 43 showing a high degree of urban deprivation. Eastbourne, Hastings and Brighton were all in that 43, with Brighton worst at No.19. Brighton was found near the top of one of the key indices of poverty – the proportion of free school meals taken up, joint 3rd with Liverpool. Male manual workers earned only 86% of the national average in spite of the higher living costs of the South East. Of the 43 worst towns Brighton was 11th highest for children in care, 8th for the high rate of infant mortality, 15th for unemployment, 17th for the number of one-parent families, 25th for lack of basic amenities. Results for Hastings and Eastbourne were similar.

 

Moreover, this scarcely takes account of the condition of elderly people. In 1974, 40% of the population of East Sussex was over retirement age. Some were rich enough to purchase their needs on the market. Private nursing homes were established along the coast – many of which could more properly be called ‘factories for the aged’. Commonly run by retired nurses with doctors privately attached, their rates of profit (with fees of £100 per week and upwards) were the envy of manufacturing industry.

 

The great majority of elderly people, however, could not buy their way out. Inflation has threatened pensions and eroded savings. We know people who cook only at night when the gas is off-peak. Others live only in one room because of the cost of heating. In our area of Brighton half of all elderly people are living alone. No one can live in the coastal towns of East Sussex without being aware of this profound collective poverty.

 

Such is the background to East Sussex Social Services: on the one hand a severe and growing need, on the other belated Government Acts to make some amends for the social devastation that has resulted from the development of the private economy.

 

What has happened? Although in real terms Social Service spending has nearly trebled between 1964/5 and 1981 /2 (up by 285%), if we take it per head of population, the rise is a little over double (130%).

 

Still the major part of the budget goes on elderly people (in 1965 53%, in 1982 39%). In the decade up to 1974, spending per head rose by 50%, though the number of places in Council homes for elderly people only rose marginally. In 1974 there was one place in a Council home for every 141 people aged 65 and over, whereas 10 years earlier it had been one place for 146. But this was a time when those over 80 were growing in number so that by 1974 there was less chance of someone over 80 getting a place than 10 years before.

 

After 1974 the situation got worse. Between 1975 and 1979 real spending on elderly people actually fell by 5%, and by a further 5% by 1982. The number of places for elderly people was cut by 133 (6%) between 1974 and 1979. What happened was a switch to support services at home, home helps (up by 10%), day centres, and meals-on­wheels. But the evidence is that fewer meals-on-wheels were being provided (a drop of 10% between 1975 79), that places at day centres fell likewise, and that the number of people needing home helps was rising so fast that in spite of the increase in numbers, the hours the home helps spend with ‘clients’ fell by 2% over the second half of the 70s.

 

What stands like a great shadow behind these facts is a need which far exceeds what the Council is providing for. Those needing regular care who cannot get a place in a Council home are forced – or rather their families are forced – to seek places in the string of private homes in the town. If the scandal of the mid-19th century exposed by Charles Kingsley was the condition of children, that of the late 20th century is the condition of elderly people. Those who visit these private homes, with their ex-nurses and part-time doctors making money from age and isolation, cannot but be sickened by what they see.

 

Far from calling for cuts, we should be calling for a major expansion, in a County which has only just maintained its standard of provisions, and is now facing cuts not only in Council homes, but in the much cheaper home-based support.

 

The same general pattern is evident for children. Both residential and fostering provisions declined until just before re-organisation. Then came a jump. Places in children’s homes doubled in three years, while fostering went up by two-thirds. This was in the period after the 1969 Children and Young Persons Act was passed. Since 1974 the overall number of children in some sort of care remained static, with a switch to fostering (one sixth of the cost of residential care) and a decline of a quarter of day care places in only four years. In 1965 there was one place of some sort for every 953 children of school age. By 1979 the ratio had worsened to one place for every 1,093 children, and by 1982 to one for every 1,102.

 

The one area where there is an indisputable increase in services is in the provision for mentally and physically handicapped people. There has been a growth in the number of residential and day care places following the 1970 Act for the Physically Disabled and the 1971 White Paper on the Mentally Handicapped. In 1974 this area accounted for 8% of the Social Services budget. By 1981/82 it had risen to 16%. As with the other items of Social Services we have discussed, the suggestion that this increased spending is about some sort of festivity on the rates is as unpleasant as it is absurd.

 

Spending on Capital

 

Between 1965 and 1974 real investment per head by East Sussex doubled (up by 117%). This is a substantial rise, but once more when we set it in context, the reality is somewhat different from what it seems at first. Table 4 shows the changes in investment in physical terms. They are clearly modest.

 

Table 4

 

Physical Assets in East Sussex

 

                                                            1964/5 1973/4   

Primary Schools                                  169      176

Other Schools                                      45        41

Full-Time Libraries                             9          14

Miles of Trunk Roads                         53        53

Miles of Other Road                           1,632   1,681

Children’s Homes                                13        17

Homes for Elderly People                   19        26

Homes for Mentally Handicapped People      1          5

 

Source: Council Statistics.

 

Some of the new building involves renewing existing roads and building, and therefore the small per capita rises implied in the above figures do not present the full picture of capital improvement. This is particularly true in road maintenance, and in the re-organisation of secondary schools into comprehensives which meant new buildings for larger (and therefore fewer) schools. At the same time just as private businesses make an allowance for the depreciation of their capital assets, so we should distinguish between capital investment, which replaces worn-out or depreciated stock, and investment, which adds to the total stock. We have no precise figures for the overall value of the Council’s capital assets in this period, but on the basis of later figures, and assuming that buildings are expected to last 50 years, then as much as half the capital invested over this period cou/d be seen as merely maintaining the state of existing assets.

 

Secondly, the period of the most rapid rise in spending between 1971 and the end of 1973 was the period when both land and building costs escalated as part of the property boom, together with the general inflation of prices for primary products. We would need to make a further adjustment for this factor. Real per capita expansion was therefore much less than the overall figures originally implied.

 

There is one further point which we should note. The big increase in East Sussex capital expenditure from 1971 to 4 paralleled the growth of capital spending by all local authorities. The reason is that the Heath Government tried to fight a threatened recession in the private industrial sector by expanding State spending. In particular it encouraged capital spending, financed from the money market. This employed unused capacity in the building industry and surplus funds which the financial institutions found difficulty in placing in the threatened industrial sector. These powerful private sectors (backed by the Government in which the Minister in charge, Keith Joseph, was also a director of a leading building firm) had an interest in a public sector construction boom. It used up their surplus capacity, and indeed had other expansionary effects in the economy as a whole. Local authority spending – and particularly capital spending – became a lever for the overall management of the economy.

 

The fact that this spending was on new buildings rather than digging holes was fortunate for us. But in no way can our need for new and improved services be seen as the motive for the increase in capital spending. Nor can such increased spending be seen as evidence for a general tendency to ‘profligacy’ on the part of the County Council. For they were being encouraged to spend. As with the expansion of Further Education, the rise of capital investment between 1965 and 1974 must be seen as linked first and foremost with the support of capital accumulation in the private sector rather than welfare increases for the people of East Sussex.

 

When we come to the second period, capital spending collapses. By 1979 capital spending for the whole of East Sussex was only 19% higher than for the smaller County in 1965. In per capita terms it had fallen to only 73% of its 1976 level. By 1981/2 it had somewhat revived, but was still more than a quarter down on its level of 1974/5. Once more it is government cuts that have been the main influence behind the fall. The results have been not only a cut in expansion, but, in some sectors, an actual decline in the condition of the Council’s assets, as necessary repairs are postponed, as replacements are shelved, and projects left half finished.

 

Summary

 

In the last chapter we saw that East Sussex spending per head in monetary terms had increased by 41% in the first period, 1965-74, and by 1% in the second, 1975-79. In this chapter we set out to see whether there had been an equivalent change in the physical services provided.

 

In two cases there was a clear rise in ‘services’ per head of the population: the Police on the one hand, and provisions for physically and mentally handicapped people on the other.

 

In two other cases, water and sewerage, and grants and contributions for Further Education, the rises did not mean necessarily an increase in services provided, but rather an increase in cash contributions to services provided by other bodies. In the case of water and sewerage it is far from clear that the extra spending that has occurred has been enough to offset the deterioration of the system over time.

 

The same is true of a good deal of capital spending, which grew fast in the first period and then slumped in the second. Council accounts make no allowance for depreciation. Yet as every householder and every business knows, money has to be put aside each year to maintain the fabric of buildings, or to replace worn-out equipment and machinery. If in addition the costs of maintenance and replacement are regularly rising – and this was true of land and building costs in the early 70s – then a council may have to expand its capital spending just to keep in the same place. When there are also rapid expansions in numbers for whom services have to be provided and when these occur at times of above average inflation in land and building costs, then again we would expect major increases in monetary spending in order just to keep the same amount of provision per head.

 

So in spite of a 138% increase in annual capital spending between 1965 and 1974, the number of homes for elderly people only just kept pace with the increase in the number of people over 80. But the number of schools and children’s homes failed to keep pace with the expansion of the number of children in school. The miles of road expanded only marginally in absolute terms. Only in the number of full-time libraries and homes for mentally handicapped people did there appear to be a clear gain in provision per head.

 

In the case of schools, there seems to have been a fall in the number of children per class – though this has risen for secondary schools since 1975. On the other hand, the milk and meals service has continuously dropped and the number of children per school has shot up. Some schools have expanded their grounds and buildings for these new numbers. But in East Brighton at least, it has been all too common for the extras to be housed in temporary buildings in the playground, cramping play space. What has happened is that the sudden expansion in numbers of school children (up by 39% between 1965 and 1973) has stretched the County’s resources to the limit – merely to accommodate the rise. It comes as no surprise therefore that over the period from 1965 to 1979 per capita spending on East Sussex school children remained effectively static (up 2%). With a new bulge in the birth rate in Brighton in the late 70s, the threat to close schools (some have already gone) on grounds of economy is scandalous.

 

There is a similar picture in the Social Services. Though spending on elderly people per head of those over 65 went up by 43% in the first period, the number of places in Council homes for elderly people only rose very slightly. Indeed someone over 80 was less likely to get a place in such a home in 1974 than in 1965. Since 1975 there has been an absolute decline in the number of places in Council homes, partly compensated by an increase in home support services, though these too now appear to be declining. Since 1975 absolute spending on elderly people has also fallen.

 

In the case of children, in spite of increases in spending per head, the chance of a child at school getting a place in a children’s or a foster home had gone down by 15% between 1965 and 1979. Our examination of physical provision considerably changed the picture derived from monetary values. Between 1965 and 1974 a number of services did expand faster than population, but the growth in physical provision per head was probably much less than is shown in the monetary values.

 

Thus spending on school children, on elderly people, and on children in care – which alone accounted for 46% of the expansion in current spending – produced only marginal improvements in services. Only in the case of provision for handicapped people and subsidies and grants in Further Education – accounting between them for a further 20% of the increase – was there a clear increase in benefits. With the first we may assume no one will quarrel. With the second, there is still the real question: which interests were primarily served by the expansion of Further Education, and how much improvement was there for people in East Sussex?

 

Readers will be aware of the difficulties of judging ‘improvements’ in physical services. Some of the best teaching is done in old buildings. The Brighton Librarian and the Museum Director have shown that creative use of existing facilities can be made without big increases in resources. But this is not the point. We have tried to match many declines in service which we have felt locally as a result of cuts in resources with the claims that our consumption of welfare services – our social wage – has got out of hand. Our discussion has shown that there has been no explosion of consumption. Some services have actually declined. The attacks on services on the grounds of monetary overspending threaten not only our current living standards, but many of the social standards we had achieved by 1965.

 

Chapter 5

 

Spending for Whom? The Case of Brighton Council

 

IN 1965 Brighton Borough Council, as a spending authority, was larger than the County Council. By 1979 its spending had fallen to less than a fifth of the County’s.

 

The main cause of this decline was local government re-organisation. In 1969 a Royal Commission on Local Government (the Redcliffe Maud Commission) recommended a radical restructuring of local government. This was to be based on a) uniting town and country, and b) increasing local authority size. The report argued that in many cases – such as the police, water, fire, transport and planning – town and country were inseparable. In others, like education, health and children’s services, an authority of at least 250,000 people was thought to be necessary if economies of specialisation, training, research, planning and bulk purchasing were to be realised.

 

One of the case studies used by the Commission was Brighton. The study suggested that Brighton, with 160,000 residents, was too small both in area and population to carry out Health, Welfare or Education functions effectively. The main grounds for this conclusion given by the study and it seems by a number of Council officers was that a larger authority (including the five towns surrounding Brighton) would allow more specialisation of staff. On the other hand, the Report mentions in a footnote that Brighton’s Director of Education felt Brighton was perfectly viable as an education authority. The study nevertheless concluded that District Authorities should have a minimum of 200,000 people on ‘functional grounds’.

 

The economic and administrative arguments both on Brighton and on size in general have not been proved convincingly, and have since been the subject of academic dispute. But the main objection to the report was that it put its main emphasis on technical economies, without adequate discussion of the political implications of increasing size. The problem of how to get our councillors and local officials to be answerable to us as voters is just as much an ‘economic’ process as providing home helps. It involves travel, discussion time and organisation. It involves newspapers and radio, public meetings, lobbies, and the organisation of petitions or demonstrations. These questions were reduced, in the report, to a matter of the quality of councillors, the size of authorities required to employ a councillor’s time without allowing him or her ‘to be more closely involved in the running of services than was desirable’, and the size of constituencies to elect the councillors. The question of the control of councillors themselves – at a time when political decisions are taken by a very small group of people – was almost entirely ignored.

 

This was the background to the Local Government Act in 1972. Brighton, with less than the ‘minimum size’, lost over 2/3 of its services (in money terms), primarily to the expanded County. The Police had already been re-organised. Health was included in the new government controlled Area Health Authority. Education, Social Services, major Planning, Libraries, the Fire Service and the Administration of Justice all went to the County.

 

The result was the creation of two very different types of authority. The County itself became primarily a direct producer of personal services. They were services which were relatively standardised (e.g. schooling for children between five and 16) and capable of being controlled in broad outline from the centre (either by the enlarged County or by Whitehall), but which still needed a measure of decentralisation, because the production of these services required large quantities of labour. East Sussex Education Department, for example, employs over 10,000 staff. It is by far the largest employer in the area and is half the size of Ford Dagenham. The Social Services Department and the Sussex Police Force each employs more than 3,000 people.

 

The new Brighton District Council is quite distinct from this. It is mainly concerned with landed property (detailed planning, housing, and estate land), with the commercial, recreational and environmental character of the town, and with the administration of grants. It is charged with the physical administration of the town rather than the production of personal services. It is concerned with rent, while the County is concerned with labour, i.e. the many people it employs and who produce services, such as teachers, health workers and social workers.

 

The first result of this is that a number of Brighton Council’s activities are more independent of Whitehall than is the case for East Sussex. The planting of flowerbeds in the local park is not subject to the same close scrutiny by the Department of the Environment as the cultivation of young minds in the classrooms of East Sussex schools. Nor can the quantity and location of Council houses, or their state of repair, or the development of entertainment facilities be subject to set guidelines from central government. There are certainly financial controls on the quantity of capital spending, but for a well-endowed Council this has been an avoidable limit on a number of occasions. What is crucial is that Whitehall does not require particular levels of recreational, cultural, or commercial provision in the same way as it controls the activities of the County.

 

Secondly, the Brighton District Council has considerable independence in determining the economic identity of the town. In the 1950s it set up an industrial estate, after pressure from the Labour Movement, that led to a significant growth in engineering. Over the last 10 years the Council has allowed middle- and low-income family tourism to decline, and instead encouraged luxury yachting, offices and the conference trade. These initiatives must now be approved by East Sussex, and if necessary by the Government too, but it is Brighton Council which has taken the lead.

 

Thirdly, though the County Structure Plan determines broad zones of land use, the detailed control of sites, and of planning permissions, it gives Brighton considerable power in giving development values to particular companies. This is doubly so when Brighton Council actually sponsors projects in order to increase land values in the neighbourhood of the development. For example, American Express have recently moved their European head office to Brighton. This has immediately increased the demand for local car-parking space and housing. It may be a question of the availability of land as much as its cost which the Council has power to make decisions about: the Council’s land bank, and their power of compulsory purchase, are important contributions to a variety of commercial undertakings. Finally, the Council controls certain loans and grants – particularly in the property field – that may be used to enable land values to be realised by particular groups.

 

In short the District Council has powers over the creation, the distribution, and the realisation of rent and commercial profits. These powers cannot be described in money terms alone. For it is the circulation of value in the private sector rather than the production of services in the public sector that is the main axis around which Brighton Council turns.

 

The overall spending figures of the two councils suggest that there is a contrast between them. During the period up to 1974 while East Sussex spending was up by 43% per resident, Brighton’s total spending actually fell by 4% in real terms. However, these overall figures hide the fact that different types of spending in Brighton were moving in very different ways.

 

To begin with Brighton had to run those services which were later transferred – education, health, social services and so on. On these, Brighton’s spending per resident rose by 35%, as against 31% for East Sussex over the same period. Given the higher land costs in the town, we can say that the increase was almost the same in town and country.

 

Education

 

Brighton could hardly avoid these increases. In education for example (which accounted for 90% of the spending increase during the period) there had been a sharp increase in the number of primary school pupils (from 13,050 in 1967 to 15,961 in 1973, a rise of 22%). Seven new primary schools were therefore built, bringing Brighton’s total up to 49 (a 17% increase), though we should note that Brighton had a tendency to fill its schools fuller than East Sussex (Brighton’s average primary school had 326 pupils in 1974).

 

Where there was some improvement was in the number of pupils per teacher. The numbers fell from 29.5 to 24.1 during this period, though overall spending per child increased by only 7% between 1968 and 1974, considerably less than the growth of the national economy.

 

In other parts of the school system the trends were similar to those of the county:

 

– the number of secondary schools fell

 

– the number of children per school increased (by 21%)

 

– the money spent per secondary school child fell (in spite of a slight improvement in the number of students per teacher)

 

– school meals per child fell, and the price charged increased (by 38% over the period)

 

– the number of students at the Further Education colleges rose by 18%, but the number of teachers did not keep pace, and at what became the Polytechnic the money spent on each student per hour fell by 15% over the period.

 

None of this is the stuff of which parties on the rates are made. What we see, as in East Sussex, is a meals service already in decline, secondary schooling static, and both primary schools and Further Education colleges desperately trying to cope with the sudden expansion of their intakes. Many aspects of the educational service were worsening at a time when Brighton’s education was already being critically scrutinised by the Royal Commission’s study group. The trouble was that costs were rising faster for education than for the private economy. As a result Council spending went up even though some parts of the service declined. It is cheeseparing not profligacy that the ‘physical’ record suggests.

 

So concerned were Brighton’s councillors to keep their rates down (and we should remember that rates strike hardest at those with property – and, unlike income taxes, are difficult to avoid) that they cut those items where the government did not exercise such strict control. Those services which remained with Brighton Council after re-organisation were cut by 2% between 1965 and 1974. Current spending then rose by 9% between 1975 and 1979. This rise was more than outweighed by the cuts in capital spending. Capital spending (which like the spending on one’s house is necessary to keep up the state of repair of Brighton’s fabric) fell by 53% in the first period, 1965 to 1974, and by 51% between 1975 and 1979. This is the stark figure which explains why people coming back to Brighton after knowing it in the 60s can exclaim how run down it looks, the pavements broken and covered with rubbish, the sea front rotting, the Whitehawk estate devastated.

 

What all this amounted to was that Brighton Council – in spite of increasing need in the town and wealth in the country – actually cut its overall spending by 4% between 1965 and 1974, and by an astonishing 10% between 1975 and 1979.

 

The Retained Services

 

If we look at the services which are still Brighton’s responsibility we see a picture of falling services, or a grossly inadequate response to the town’s needs.

 

1. Parks

 

This is the one area whose spending in value terms fell absolutely over the period. 16% less was being spent on Parks in 1979 than in 1965.

 

2. Environment

 

This covers such services as refuse collection, the inspection of abbatoirs, the cleaning of streets, the provision of public toilets and so on. In monetary values these show a 7% gain over the full period, all of which occurred since 1973. But Table 1 suggests that the physical output of the services we receive has actually declined. Thus there has been a reduction in the number of public toilets in the town (last year a survey showed Brighton to have the worst public toilet facilities of a sizeable sample of English towns), a small fall in the miles of streets cleaned, and curiously, a decline in the tons of rubbish collected. The latter is not so much a decline in the service – since rubbish is still collected as regularly as it was in 1965. But it certainly does not indicate that it has become more difficult to perform the service, or that more demands are being made of it.

 

Table 1

 

How our Services have Changed

 

            Tons of Refuse Collected         Number of Public Toilets        Miles of Streets Cleaned

1968    66,820                                     96                                            235

1979    55,500*                                   91                                            228

 

*1977 figure.

 

Source: Council Statistics.

 

Table 2

 

Transport

 

No. of Buses    Vehicle            Miles (million) Passengers Carried (million)  Average fare (constant prices)   

1961/2             64                    2.68                             26.5                                         4p

1978/9             60                    1.80                             10.7                                         10p

1981/2             56                    1.65                             9.3                                           12p

 

Source: Council Statistics.

 

3. Transport and Highways

 

The Highways and Transport Department is responsible for all road repair, car parking, the servicing of all the Council’s vehicles, and the running of the Corporation bus service. Overall the Department’s spending has fallen by 13% between 1975 and 1979. The fall of non-bus spending (by 10%) was consistent with the decline of road and pavement repairs which has for so long been the subject of complaint in Brighton. This is also reflected in the fact that the number of workers employed in repairing highways and pavements has fallen from 48 in 1975 to 31 in 1980, while the Borough Engineers Department as a whole lost 50 of its original staffing of 170 over the same period.

 

Bus service spending actually rose (by 17% between 1975 and 1979) but fares were increased by so much that Brighton ratepayers paid less towards the bus service by the end of the decade. In spite of the increase in costs, the service we receive has declined. Table 2 shows the extent of the damage over the last 20 years.

 

There are now 56 Corporation buses, eight less than in 1961. They travel over one million miles a year less than they did 20 years ago, which means that the service provided has fallen by 38% during this time. At the same time fares have trebled, while the number of passengers has fallen by two thirds. In 1981 Brighton buses carried 9% million passengers compared with 26½ million in 1961. This is a measure of the collapse.

 

In material terms then there is a picture of decline and dilapidation in the state of the roads, the pavements and the bus service. Even the number of off-street parking spaces fell during the 1970s. Only when the profits of private enterprise were at stake has major expenditure been incurred – in the building of the Black Rock interchange.

 

This was a £5 million road scheme that was part of the massive Brighton Marina project, in which leading figures on the Council played a key role. Ratepayers’ subsidy to this scheme – which catered only for the wealthy minority who could afford to use the Marina – had by 1982 amounted to nearly £1.7 million (one third paid by Brighton Council and two thirds by East Sussex). Over the same period (1974-82) rate subsidy to the Corporation’s bus service – available to the whole town – totalled less than £1.3 million. No two figures could show the social priorities of Brighton Council spending more sharply.

 

4. Museums

 

This is a small but growing item of expenditure. It covers the costs of the Central Brighton Museum and Art Gallery, Preston Manor, Rottingdean Museum, Booths Bird Museum and the Royal Pavilion. It is the Pavilion which in the 1970s accounted for almost all the increase in spending. Like the Marina, the Royal Pavilion is a building which ‘brings business to the town’. It is also a building whose costs we now subsidise (by £76,000 in 1981/82).

 

5. Housing

 

Housing spending is in two parts, public and private. Between 1964/5 and 1978/9 the two moved in opposite directions. On the Council’s own property (largely Council houses) current spending actually fell by 1% over the period. But with respect to the private sector (Housing Associations, loans and grants for private house purchase and improvement, or rent allowances for private tenants) Council expenditure rose by no less than 61% between these dates. Taken together, all Housing expenditure rose by 14%, a rise explained entirely by the growth of loans and grants to the private sector.

 

Council Housing

 

On the Council house side, the record is stark. In 1967 the Council had a stock of houses and flats of 11,396. By 1975 this had risen by more than 1,000 to 12,468. In 1982 the number had actually fallen to 12,412, and this takes no account of the fact that where new flats and houses replace old ones which have been demolished (as in Whitehawk) the new have substantially less space. If we measured the actual area of living space owned by the Council, it could well have fallen over the period.

 

It is not a case of lack of spending. Since re-organisation in 1972 the Council has invested £27 ½ million in housebuilding. Indeed these new schemes have been the bread and butter of Brighton’s large construction firms. But instead of building up the stock and quality of public housing, the Council has effectively acted as a go-between in the private housing market. It secures land, raises finance, offers contracts to the local building industry, and then provides mortgages for council tenants to become owner occupiers and buy their houses at a discount. Over the past 15 years from 1967, the Council has sold no fewer than 1,224 houses, as against a net increase in its own stock of 1,016. Since 1977, the Council has actually sold (640) more than it has built (596). The ones sold tend to be those in better condition. For example, of the 4,027 pre-war Council houses in 1967, there were still 3,951 held by the Council in 1980. So it is the post-war houses which are being sold, so that the overall quality of the Council’s housing stock is tending to decay.

 

It is nothing less than a scandal that after decades of sustained national growth, and of heavy investment in council housing, a recent survey could report that 5,510 (45%) of the Council housing stock are in urgent need of renovation, 765 are unfit for habitation, and 72 lack the basic amenities. Nor can we fail to notice that 1,261 people currently on the housing waiting list could almost all have been housed had the 1,224 modern Council houses not been sold.

 

Rents meanwhile have risen. On a three-bedroomed Council house, a rent of £6.43 in 1975 has risen to £15.16 in 1981, which if we take account of inflation, means a rise of 10%. Recent rent increases have made the situation far worse.

 

These rents have gone towards paying for the ‘cost’ of Council housing. Since 1973 it ‘cost’ £63 million to service the Council’s housing programme. Of this, no less than £36 million (57%) went to pay financiers’ loan charges. The remainder went on repairs (insufficient as the current state of many Council houses makes plain) and the management of the estates. For some reason this has risen sharply, so that a Council tenant who was paying an average of £1.92 per week in today’s prices to cover the cost of the Council’s administration and management in 1967, was by 1979 having to pay £3.63, (more than a fifth of the weekly rent).

 

Not surprisingly, Whitehawk tenants, whose houses often cost no more than £250 to build, who find it difficult and sometimes impossible to get repairs done, who are threatened with demolition and a loss of living space, and who are paying more than £15 a week (£750 a year) for their house, hardly feel it just of politicians to suggest that they have been having a party on the rates.

 

Private housing

 

The budget increases that did take place were to subsidise and oil the wheels of the private housing market. In the mid 1960s this type of spending amounted to less than a quarter of the total Housing budget (24%). By the time of re-organisation in the mid-70’s it had risen to more than a third (36%) and remained at about this level for the second half of the decade.

 

The main spending has been on support for owner occupiers through providing Council mortgages and capital for improvement, and on Housing Associations. Between April 1973 and March 1982, private house owners received £13½  million from the Council as loans to finance house purchase and improvement, nearly £5 million in improvement grants, while Housing Associations received £12 million in loans. The combined total of £30 million was almost exactly equal to total Council house investment over the same period.

 

Whereas in 1973 Brighton ratepayers contributed only £53,000 for home improvement grants, as against £718,000 for Council tenants, by 1981 the balance had switched to £¼ of a million in improvement grants and only £145,000 to Council tenants. Since 1973 private owners received nearly £5 million in subsidy, of which £1.4 million was paid by the Council and the rest by the Government.

 

We do not know what proportion of these subsidies were paid to private development companies. In March 1983 the Council was reported to be taking action to recover a £63,000 improvement grant which had been used by a property company to convert the Argyle Hotel into holiday flatlets which were let at rents of between £25 and £45 a night. Similar abuse of the intention of these grants has been reported elsewhere in the country. That aside, it is clear that those fortunate enough to own a house have benefited from Council spending.

 

Housing Associations have a quite different significance. They are non-profit making bodies set up to provide homes for rent. They see themselves as standing between private developers/landlords on the one side, and councils on the other. Their finance usually comes primarily from state bodies: the local Council, the Exchequer, or the national Housing Corporation, normally at a subsidised rate of interest.

 

By the early 70s Sussex was second only to Lancashire in the number of Housing Associations in operation. Brighton had no fewer than 17 at the time of re-organisation. Since that time the number has risen to 27, and the annual sums advanced increased to £1.9 million in 1978/79 and to £2.3 million in 1979/80. Altogether Brighton’s Housing Associations had loans outstanding to the Council of £6.4 million in 1980, and had completed 570 homes.

 

The charge in the Council accounts represents interest payable by the Council on finance raised to re-lend to Housing Associations. It is the one item to have expanded in the Housing budget (other than Council house administration), and now stands at some 2/3 of a million pounds. It is also an item which the Council plans to expand. In the current Capital Programme there are plans to lend more than £15 million to Housing Associations, that is 24% of the total set aside for all Housing, and 21% of the total Council capital budget over the five years 1979-84. If we add in the finance to be raised for private house buying and improvements, we find that 40% of total Council spending is to take the form of subsidised capital for the private sector.

 

How should we assess this growth of private provision? Certainly homes have been completed at little expense to the ratepayer. Rents have been charged to cover costs – so-called ‘fair rents’. As an official report put it in 1974, new Council houses were expected to involve a loss of £1,000 per year, of which £250 would be funded from the rates. A similar house provided by a Housing Association would incur a charge of only £25 on the rates. How could this be anything but a good bargain from the point of view of the ratepayer?

 

Good it may be from the narrow perspective of the ratepayer’s purse, but it is certainly neither good nor just from the viewpoint of the lower paid who do not own their own houses. In the field of public housing there has always been a principle of re-distribution, a principle that the town’s property owners should make some contribution, along with the government, to the finance of housing for the less well-off. Equally important, the fact that people who own their own house can set off their mortgage payments against tax means that they get an effective subsidy from the government far larger than any council tenant is likely to have. On top of this they have been given the subsidised loans and grants for home improvements we discussed above, as well as gaining from inflation (inflation has pushed up the value of property while cutting the real value of the house owners’ debts).

 

Owner occupiers thus receive their subsidies in the form of tax relief and improvement grants, while Council tenants receive their subsidy through lower rents. Forcing the less well-off to pay ‘economic rents’ for Council houses, or for accommodation provided by Housing Associations (who are required by law to cover their costs) means that subsidy is taken away from those who don’t own their own houses, while leaving the subsidy to those who do. There can be few of our readers who would judge this to be fair. ‘Fair rents’ are fair only to the better off, because they no longer have to contribute (via higher rates on higher valued property) to the housing of the lower paid. Brighton Council has gone a step further. It has not only charged ‘fair’ rents to Council tenants, and encouraged Housing Associations as a way of escaping any significant subsidy at all to the less well-off, it has also greatly increased the subsidy to owner occupiers through soft loans and grants. This is a policy of Robin Hood in reverse – taking from the poor to give to the rich.

 

There is worse to come. Housing Associations have met with the approval of the propertied professionals who run our Council for another reason. They give substantial power to the Housing Associations’ Committee of Management in placing contracts and in placing tenants. They also give the owners of land and the pillars of the local building industry what sometimes appears to be close to a captive market.

 

Take for example one of Brighton’s larger associations, the Kemptown Housing Association. In 1973 it decided to build a block of old people’s flats in the Queen’s Park area. A piece of land was available, which the Council had been pressing to have developed. The land was bought at market value, with planning permission (£65,000) and a Council loan of £205,000 was secured. The block is completed, inhabited, and is known by the name of the Housing Association’s chairman, (now the late) Mr Sydney Tidy. Fair rents are paid to cover costs. All appears a model of straight market dealings.

 

Now we may look at it from the point of view of those whose ‘costs’ were paid by the Council loan, and repaid by the ‘fair rents’. The land was originally sold, with a Church Hall upon it, for £8,500, to a family trust, the Sydney Tidy trust. The Trust got planning permission. The Hall conveniently burnt down, and the Trust was able to sell the land at a handsome profit to the financially sound Housing Association. Then came the time to place the contracts. The main contractors were a leading construction company, S.M. Tidy. The circle was complete.

 

In this case, then, the Housing Association form was certainly an extension of the Welfare State to one of Brighton’s better placed citizens – and his family. But the inhabitants of Sidney Tidy House will for many years to come be paying a ‘fair’ rent to cover the windfall profits of their benefactor’s family trust and the profits of S.M. Tidy construction company.

 

Evidence on Housing Associations elsewhere indicates that such a case is not uncommon. Housing Associations themselves are not allowed by law to make a profit. But there is nothing legally to prevent those who sit on their Committees of Management from themselves providing land and services – wearing their private company hats – at market prices and with market profits.

 

The same is true of the power to choose tenants for Housing Association properties. Officially the Council may nominate 50% of the tenants, and has the power – in many cases – to approve the others. Tenants should be people in need, though they need not be at the top of the Council house waiting list. The other 50% not only gives the power of patronage to the Management Committees of the Housing Associations, but, in certain businesses, may offer a convenient way of fertilising business. Property companies, for example, may wish to have available alternative accommodation for sitting tenants. Estate agents may find an elderly house owner living in too large a house. They find suitable alternative accommodation in the Housing Association to which they belong, and act as agents for the sale of the vacated property.

 

Much work needs to be done on Brighton’s Housing Associations, particularly if the experience from elsewhere in the country can be seen as evidence of commercial practice. But let us take one further example from the Queen’s Park area. This is striking because although it is a private association it is run by the Council, and has its registered address at the Town hall. Rents are paid to the Council, the gardens are kept up (or not as the case may be) by the Parks Department, and repairs are carried out by the Housing Department (though they do not receive the complaints). The Secretary was one of the Council’s solicitors, the Hon. Secretary was the former Borough Treasurer (now the Town Clerk), and the Hon. Architect was the Council architect (whose son incidentally was the architect for Kemptown Housing Association). On the Committee were three current Councillors and two former Councillors. Altogether there were three estate agents on the Management Committee, two of whom either were or had been on the Council.

 

This is, to say the least, a blurring of distinctions. It allows leading professionals to operate without the need of public committees and public disclosure. It may of course be read as public-spirited. But the kind of situation to which it can give rise is as follows. An old woman was living alone in a house too large for her since her husband’s death. The Chairman of the Housing Association met her through the church and arranged for a place in his own Housing Association’s block of flats. He then sold her house through his firm of estate agents to one of the solicitors on Brighton Council who was provided with a 99.7% Council mortgage. If the same thing had happened in a Council housing scheme, a declaration of interests might be the minimum we could modestly expect. (The same goes for the placement in the Association’s flats of the mother and aunt of another of the ex-Councillors on the Committee of this Association.)

 

What Housing Associations do, therefore, is to place the building and the letting of houses outside public control. In their present form they are a most unsatisfactory alternative to public housing – unsatisfactory that is from the point of view of current or prospective tenants. This is one of the main reasons for the outrage in Whitehawk at the demolition of half their estate, and the selling of part of the land for Housing Association development.

 

An assessment of Brighton’s Housing record should therefore look at Housing Associations along with Council House building. There has been an addition to the stock, but it has taken a form which has intentionally been fostered by the Council to weaken the position of tenants (with respect to rights and rent) and of the Council itself in relation to the Housing stock. Compared to the equivalent finance and building of new Council housing, the ‘commercial’ Housing Associations have been of disadvantage to many, and of advantage to an already wealthy few.

 

6. Conferences and Tourism

 

At the time of re-organisation the conference and tourism budget stood at a modest 6% of total Council spending. It included small amounts for the encouragement of conferences, for tourist publicity and supporting services, for the four swimming pools in the town, for various traditional amenities along the sea front such as the Volks railway, for illuminations, and subsidies for certain ‘cultural events’. By 1978/9 the Department had grown to 20% of council spending. In value terms (excluding inflation), while most other departments remained stationary, Conferences and Tourism rose by no less than 262%.

 

It was not the traditional amenities which were the cause of this great expansion. Indeed most of them have followed a pattern that will be recognised from other parts of the Council’s responsibilities: delapidation, unless there is somewhere, somehow, money to be made. One of the clearest examples is in the policy on swimming pools. Table 3 shows the use of the four swimming pools between 1968 and 1979.

 

Table 3

 

Swimming Pools: Attendances

 

Black Rock      Rottingdean     Saltdean          North Road     Hours of summer sunshine

1968    80,924             19,753             49,299             60,456             1,088

1975    26,791             12,169             35,361             49,113             1,100

1979    19,411             8,388               24,631             44,889             979

 

The first three are open air pools and service a wide area along the sea front. The most popular of these was the Black Rock pool. Unfortunately for its users, it was sited next to the plot chosen to build the new Marina. The Marina Act, passed in Parliament, specified that any damage caused in construction should be compensated by the Marina Company. Damage was caused. Attendance was driven down in the early 70s since the main carriageway to the construction site ran immediately past the pool. Material for 165 x 600 ton caissons was led along this road which, like the swimming pool, had been built on an old rubbish tip. Cracks began to appear in the pool (which was already in need of repair in the late 60s). The Council stalled, hoping that the Marina company would provide an alternative pool. They never did. Nor did the Council request compensation for the lost service, or for the repair to the decaying pool. Finally in 1979 the Council declared that the pool was past repair and would have to be demolished. A mass protest centred in the Eastern end of the town stopped demolition temporarily, and also prevented the assigning of the area to a lorry park. Instead the Council have offered the site for private leisure development.

 

What has been built is a new swimming pool in the centre of the town, costing £2 million. This is undoubtedly a real addition to the town’s facilities. But the ‘fair admission’ price to this pool (plus the bus fare necessary to reach it from the outlying estates) is such as to put the pool out of the reach of many of those who used to use the old town pool in North Road or, in summer, the pool at Black Rock. In addition to the high admission price the pool has been criticised as being quite inadequate (the showers and tiny changing cubicles and lockers, for example) and over-crowded. Certainly a pool of this size, however new, has already shown itself to be quite insufficient for a town of more than 150,000 people.

 

The Conference Centre

 

To the South-West of the new pool, looking out over the Channel, is an even larger project, the Brighton Conference Centre. This £10 million building at the western end of the town and the Marina at the eastern end are together the two blades with which Brighton’s Council have aimed to reshape the town’s economy. On the one hand the family tourist trade would give way to luxury yachting. On the other, the commercial centre would be reworked around the conference trade. The main hotels which had suffered from the decline of the holiday business, and which could not expect to pick up much from the Marina, were instead offered this new source of trade. So were the town centre shops whose falling demand and falling profits, were necessarily translated into falling town centre land values. The Conference Centre, now in its sixth year of operation, has certainly benefited them both.

 

At the same time it has cut a great swathe through the town’s budget. Not only have the rates had to meet massive debt servicing charges, but the Centre itself is making large losses. For one of the characteristics of the conference trade is that little if any charge is made for the use of conference facilities. The result is that to date the rates have subsidised the Centre by approximately £10 million.

 

The breakdown of the relevant figures is given in Table 4. The first point to note is that the Conference Centre alone accounts for more than 70% of Brighton’s increased current spending between 1974 and 1982.

 

Secondly, the conference subsidy in the latest year accounted for 31% of Brighton’s rate income. This is a staggering figure, and does more than any other figure in this book to highlight the nature of Brighton’s spending priorities. While the Council was cutting back on Council house tenants, on the parks, public conveniences and swimming pools, on the buses and on the maintenance of the very fabric of the town, while it was urging all those who lived here to tighten their belts – at that very moment the Council was paying out nearly a third of the Council rate income to subsidise the Conference Centre.

 

Thirdly, every use to which the Centre has been put has made a loss, mostly on a permanent basis. The conferences alone have cost the town nearly £1 million in direct subsidies (particularly when you take the conference entertainment budget into account). In the year 1981/2 for example, conferences cost the town £225,000 against which income from conferences was only £13,000. Deficits were also registered in all the activities shown in Table 5.

 

Table 4

 

Brighton Conference Centre

 

Year ending     Gross spending           Gross income  Net Subsidy     Subsidy as % of rates

1975                54                    –                       54                    1

1976                253                  –                       253                  4

1977                664                  –                       664                  9

1978                1,462               222                  1,240               16

1979                2,552               807                  1,745               21

1980                2,641               743                  1,900               29

1981                2,900               921                  1,978               27

1982                3,372               1,044               2,328               31

Total    13,898 3,737   10,162

 

Source: Council accounts.

 

Table 5

 

Breakdown of the Conference Centre Subsidies 1975/82

 

                                                            000’s

Cost of vacant dates                           365

Conferences                                        800

Exhibitions                                          573

Sporting events                                   130

Entertainments                                    611

Catering                                              64

Servicing of debt

(parallel to a mortgage payment)        7,277

 

Total                                                    10,162

 

Source: Council accounts.

 

Is it worth it? Certainly the citizens of Brighton now have the possibility of attending a Christmas ice show, a Daihatsu tennis championship, and a periodic rock concert. The entrance charges are high, not high enough to cover costs, but high enough to prevent a large number of people from regularly attending. But in any case this was never the main point. The purpose of the Centre was not to cover costs (let alone make a profit) but to attract conference business to the town. Though the balance sheet shows a loss, – so say the Councillors who were responsible for the scheme – the town will gain.

 

There are two things to say about this. First, the main beneficiaries are a small number of private companies and concerns. Only the large hotels (out of the 237 hotels and boarding houses in the town) have tended to benefit along with some but not all of the 132 restaurants. Even if we were to count all restaurants and all hotels, they would account for no more than 2.5% of the rateable value of the town – yet on their behalf a Centre is built which takes nearly a third of the local rate income. Secondly, while commercial criteria have been applied to projects serving a social need (“can they pay for themselves? – if not, the ratepayers won’t stand for it”), in the case of the Conference Centre commercial discipline has been suspended and instead its case is based on the indirect effects which cannot be captured in the account books of the State.

 

It is clear then that it is not the relative profitability of a project which counts, but who enjoys the benefit. Council tenants should pay an ‘economic rent’. Public toilets should be reduced since they are a drain on the rates. But if conferences bring business to declining hoteliers, even though they pay not one penny to the Council treasury, then £2 million on the rates is termed an ‘investment’, not a ‘drain’, a generator of employment, not an addition to ‘unproductive labour’. In this case, whatever word you use, no one can argue that this rise in Council expenditure represents an ‘overconsumption’ of public services by the great majority of the people of Brighton.

 

Capital Spending

 

Any tendency for current spending to rise has been counteracted by a sustained massive attack on capital spending. In 1979 annual capital spending stood at only one fifth of its level in 1965. By 1982 it was less than a seventh.

 

When we consider that much of this spending was meant to make good the normal wear and tear of Council assets, and that land and construction costs in the early 1970s rose faster than the general rate of inflation, then the collapse of the level of ‘real’ expansion is all the sharper. What is clear, however, is that Brighton Council have organised the capital investment that did take place in clear phases. The first two years after re-organisation was the time of the building of the Marina interchange road system (1974-76). This was followed by two years when the Conference Centre spending was so large that it drove housing investment down to a third of its normal level. When the conference centre was substantially completed, it was the turn of the Prince Regent swimming pool. When we consider that much housing investment takes the form of large contract schemes, we can see how capital spending is dominated by major projects at the expense of the smaller ones.

 

Summary

 

In Chapter 3 we found that Brighton was distinct from East Sussex in that its spending had fallen in real terms in all three periods under study. A closer examination of the elements of Brighton expenditure, both in value and in physical terms, suggests that this overall average decline hides some quite contrary movements.

 

On the one hand a number of provisions have either remained static or declined:

 

– spending per secondary school pupil before 1974

 

– school meals per child

 

– staff-student ratios at Further Education Colleges

 

– spending per head on Parks

 

– the number of toilets and attendants

 

– tons of rubbish collected per person

 

– miles of streets cleaned

 

– street maintenance (roads and pavements)

 

– the bus service

 

– Council car parking spaces (since 1972)

 

– museums (excluding Pavilion) since 1974

 

– spending on Council house repairs per house (since 1974)

 

– swimming pool facilities at the four traditional sites

 

These are all cases where we have either been able to assess the change in physical services, or have figures showing real monetary values which strongly suggest a decline in physical services (such as the Council house repair bill).

 

Secondly, in some cases higher charges in themselves constitute a worsening of service because they restrict their use to those who have enough money to afford them. This was true for:

 

– school meals up to 1974

 

– the bus service

 

– the new swimming pool

 

Thirdly, a number of services have clearly remained static or declined, although the cost of providing them (allowing for inflation at the general rate for government) has increased. These include:

 

– the cost of refuse collection

 

– the cost per house of Council house administration

 

– the level of Council house rents

 

What has expanded on the other hand has been primarily certain large projects or programmes:

 

– the Brighton Marina, with its £5 million interchange at its entrance

 

– the £10 million subsidy to the Conference Centre

 

– the £2 million swimming pool

 

– the £12 million of loans to Housing Associations

 

– the Royal Pavilion (which in addition to its expanding recurrent budget during the ‘70s is currently receiving a £1 million facelift)

 

– a succession of major housing schemes, built by private contractors, which in spite of outlays of £27 million since 1974, added nothing to the public housing stock because of the policy of Council house selling

 

The added expenditure in these fields has too often been at the expense of a run down in others.

 

There has then been a sustained drive against those public services which are geared to the needs of the ordinary people of Brighton. Whenever an asset can be turned over for private firms to run, the Council has done so, regardless of the loss to the broader welfare of the town. When the Royal Spa was under Brighton Council’s control they tried to let it at a peppercorn rent to a private businessman for use as a casino. This was nearly an acre of a public park which local residents unanimously wanted as the site of a nursery school and adventure playground. The privatising of the Black Rock swimming pool site is another example, as is the encouragement of Housing Associations, or the passing over of the town’s car parks to National Car Parks. Where there is a valuable piece of public land, the Council does not ask how it might be used to benefit the ordinary people of the town, but rather how to get rid of its responsibilities (and its assets) at the least possible cost to the rates.

 

This general policy has been suspended for various projects whose primary aim has been to ‘encourage business’ in the town. This term, to ‘encourage business’, means encouraging the business of those interests who own the land, the large hotels, the building companies, the estate agents, and the other ‘professional’ firms in the town, and who have effectively controlled the Council. These people have suggested that what encourages their business will also benefit us. We can now see how far from the truth this is. For they have consistently shifted our rates from services which provide for general needs (at the same time providing jobs) to projects which are geared to the business needs of a small minority.

 

When the question of the majority’s needs is raised, the call comes out that rates must be kept down. But when the commercial needs of the minority are at issue, then the offspring of ‘old corruption’ have shown themselves willing spenders of the public rates, and inventive users of our collective assets.

 

They pioneered the Marina through two town polls, two Public enquiries, an Act of Parliament, and 10 years of sustained opposition. They developed an ingenious form of finance for the Conference Centre (a lease-back agreement with a merchant bank) in order to get round Government restrictions on capital spending. Similarly on the new swimming pool they avoided borrowing restrictions by selling farm land (albeit in unsavoury circumstances). Throughout the period they have used the skills of the estate agent members to gather together development in the town centre. In short, there is no question of the Tory Council’s entrepreneurship when it comes to Council activity that favours private capital, nor of their willingness to spend freely on the rates.

 

Yet given their general commitment to minimise rates, the Council’s commercial initiatives have meant an even greater clamp-down on the democratic services. The various allegations of corruption which have been made – a number with good cause – over the last 15 years are only a gloss. For the much larger corruption is a general one, depending not on individual fraud, but a collective subversion, where a narrow group of local businessmen, property dealers and professionals have had control of the Council and used it primarily not for the benefit of the great number of people in Brighton, but to reproduce and expand commercial values (and their political control) of the town. That they have retained power for so long should not be seen as some democratic mandating of their priorities and their acts, but as a major question mark to the way representative democracy works at a local level. The fact of their election should not end our enquiry (as they would like it to) but begin it. For our starting point should always be – not their version of authority, let alone their version of what is best for the town – but the use of public assets and our rates for the public not the private good.

 

Chapter 6

 

Local Council Spending: Who Pays?

 

PART of the monetarist argument against local councils is about the way that council spending has been financed. Regardless of the need for services, the funding of local government had reached a point where it was undermining the health of the private sector.

 

The Money Market

 

One version of this argument related to the capital budget. Local Government was borrowing from the national money market and thus taking away the scarce capital needed for industrial growth. Less capital for productive firms meant less growth. So we got the campaign to cut local government borrowing.

 

There are two things wrong with this argument. First, both Brighton and East Sussex paid more into the national money market in the years since 1974 than they took out. Take East Sussex first. In the year 1981 /2 they borrowed just over £4 million. But they repaid nearly £6 million of their outstanding debts, plus more than £10 million in interest and debt management expenses. So they provided £16 million to the City and re-borrowed, as it were, only £4 million. The County therefore made nearly £12 million available for private sector investment.

 

This has been a regular pattern. Before 1974 East Sussex had been a net borrower of funds from the money market in seven out of the previous ten years. Since then it has been a supplier of funds in the form of interest and loan repayments in sums greatly exceeding the amounts it has borrowed. In interest alone it has paid out £63 million on top of repaying £32 million on its outstanding long term loans. New long term loans raised amounted to £29 million.

 

Brighton in 1981/2 borrowed £18 million in long term loans but repaid £22 million, as well as nearly £12 million in interest. Even if we include Brighton’s short term borrowing and overdraft, the town still finished the year repaying nearly £3 million more than it borrowed, which, together with the interest, made a cash contribution to the City of more than £14½ million.

 

Since 1974, Brighton has paid out £69 million in interest, and has been a net borrower from the money market of short and long term capital of £29 million. In every year between 1970 and 1982, with the exception of two years after re-organisation, Brighton has paid out in the form of interest and loan repayments more than it has borrowed. The inflows and outflows are shown on Chart 1. What this means is that in cash flow terms Brighton is borrowing to help pay off its interest.

 

Far from draining the country’s stock of money capital, our two Councils have served as a reservoir of new capital. Between them they paid £132 million in interest in the eight years up to 1982, while borrowing (net of repayments) less than a quarter of that. Indeed public borrowing has in many ways been the saviour of the money market during the 1970s. Industry’s declining profit rates meant that many firms were unable to pay the required interest on borrowed money, and so banks were reluctant to lend. This left them with the problem of where they could lend their money at interest, and so more and more they turned to governments. Governments, unlike firms, do not go bankrupt. They may find it difficult to pay on time, but they have the power to tax, and this means that they are able to siphon off any profit that remains in an economy to service outstanding loans.

 

So local government’s borrowing, like the central government’s own ‘public sector borrowing requirement’ has been a source of strength for Britain’s money markets. When British public borrowing was not enough to mop up the surplus money capital in this country, the bankers went overseas. They lent billions to the newly industrialising countries (Brazil, Mexico, Zaire, South Korea, Taiwan) – mostly to the governments themselves or with government guarantees. They also lent large sums to the Eastern European countries. By the end of the decade many of these countries were having difficulty in servicing the loans: increasing taxes, introducing austerity programmes, cutting their budgets. Poland and Mexico have been the two recent hot points of this financial crisis.

 

This lending to governments has not starved the private sector of capital. It has been done because the private sector was too insecure to absorb the money capital that was available. As London’s bankers have often pointed out, there is no shortage of finance in this country. The problem is a shortage of investment opportunities. Nor – in today’s world – is the stock of money itself limited. There is no given quantity of gold or pound notes which has to be distributed between different types of borrowers. If a profitable investment does arise in private industry, banks themselves can create money by granting overdraft facilities. The Bank of England tries to control this, but recent monetary history has shown that they have had only limited success. For this reason, even if Brighton had borrowed more than it repaid, it would still not have limited the amount that could be lent to private industry.

 

Funds for Running Costs

 

Councils borrow from the money markets to finance capital investments. There is a convention (it is no more than that) that the building of a school, a road, or a council house creates an asset which yields a return over the years and should therefore be funded by borrowing and repaid with interest. It is an attempt to treat the Council as if it were a business, investing for a return. In fact it is no such thing.

 

It is out of the question however to finance the Council’s running expenses from borrowing. Local government does not sell its products on the market, so there would be no way of repaying the loan, quite apart from the interest. Instead of this, funds for current expenditure are raised by taxes (the rates), from grants, or by charges.

 

A second string to the monetarist argument is that the financing of local government’s current expenditure by any of these means has had a negative effect on private industry. To begin with, they say, increased domestic rates and consumer charges reduce demand for private industry’s production. This is undoubtedly true but trivial. If somebody spends £1 on something it means he or she will not spend that £1 on something else. Such a proposition does not take us very far. A more interesting question is whether the growth of State spending is somehow leading to a wrong balance between the public and private sectors, as a result of an increasing part of consumer spending being earmarked for payments to the State.

 

Readers will recall that in Chapter 3 we noted that changes in the amount of money spent on public services in comparison to private goods do not necessarily reflect changes in the physical quantities of public services and private goods received. This was because manufactured goods tended to fall in price because improved methods of production meant less labour was used in the production of each item, and therefore each item contained less value. With public services on the other hand, where no increases in productivity occurred, the same amount of labour would be required, and therefore value and prices would not fall.

 

This is a difficult point but it is central to the argument of this book. The same basket of manufactured goods will in the above case cost less in money, while the set of State services will cost the same. So it will appear that spending on the State services has gone up as a proportion of total spending even though the physical amounts of the manufactured goods and State services have stayed the same. It is all a question of different labour productivities: in one case they go up (and prices fall), in the other they remain the same.

 

If this line of argument is correct, we would expect a consumer to have to devote more of his or her money to State services merely in order to keep the right balance in the physical quantities of State services and manufactured goods. Indeed our evidence suggests that if anything the balance is going the other way, that State services are being restricted (in spite of costing more money) in comparison to the apparently unending stream of manufactured goods. Much as the private manufacturers would like consumers to switch their money from financing State services to buying goods on the market, there is no reason why they should do so.

 

The other way the Council’s running expenses are paid for is through government grants. What effect will this have? The grants may be financed by borrowing on the money market, with consequences we have already discussed with respect to capital borrowing on the money market. They might be financed by the direct expansion of the money supply which we would expect to be inflationary. Alternatively they would be financed by taxes, which would reduce consumer spending, private savings or private profitability, depending on how the taxes were levied.

 

As with commercial rates, there is no reason why we should not expect private businesses to contribute towards taxes. This is one way in which a proper mix of State services and private goods can be brought about. Such businesses would prefer, like any taxpayer, that their tax fall on someone else. This, they say, would help their profit rate and their investment. But our point is that some of this profit needs to be channelled into the State sector to maintain services there.

 

There is a further point to be made about commercial rates. To an industrialist rates appear as a cost which cuts into profit. But because rates are raised on property their effect is to cut the price of property rather than increase overall property costs (rent plus rates) to enterprises. Rates and property prices are inversely related rather than additional to each other. Recently, there has been a unique chance to test this argument. The Enterprise Zones set up by the current government cut all rates to industry in those zones. The effect has been to increase property prices so that overall land costs are similar to those that existed before when they were made up of rates as well as rents. So instead of cutting into productive industry, rates are deductions from the rents of private landlords. Their effects on industrial profits are (except in the short term) correspondingly reduced.

 

It remains true, nevertheless, that the way in which council spending is financed will have different implications both for overall economic activity and for different groups. A greater contribution from rates will be funded mainly by domestic and commercial owners of property. A greater income from fees, rents and other charges will mean that the increased cost of services is largely borne by the users. An increased contribution from the Government will imply either funding from taxes, or the raising of loans from the money market with consequences we have already discussed.

 

Charging the Consumer

 

In the case of East Sussex, the most important trend has been for an increasing share of the cost to fall on the users of the services. In 1965 these charges accounted for 10% of the County’s income. By 1975 they had risen to 19%, and to 20% by 1980. In Brighton there has been a similar trend. Our figures only start in 1974 when rents, fees and charges made up 55% of total income. By 1982 they had risen to 60%. Accounts which analyse the funding of net expenditure (excluding much or all of the income from rents, fees and charges) hide the striking fact that a major part of the increase in council spending is being financed by the users, that is to say by the very people in need.

 

Some of these changes (in the case of East Sussex) were due to re-organisation. But they also reflect the policy of both Councils to shift wherever possible from a general social charge to individual market prices. Thus Brighton Council has reduced the rate contribution to Council housing to one seventh of its 1974 level in real terms. We have already seen that bus fares have increased three times over two decades, taking inflation into account. Prices for school meals have been pushed up faster than the general rate of inflation. Library fines have risen. The record library has become prohibitively expensive. The rate funding of adult education classes has been cut by 50% and the course organisers told to ‘pay their way’. Local community centre funds have been cut, leaving the centres to raise their funds through fees, jumble sales, and subscriptions (that is to say individual charges to users).

 

In all these cases the arguments are presented as the need to make ‘economic’ charges and to reduce ‘subsidies’. But this is to forget (or ignore) three of the basic reasons for developing local council spending in the first place:

 

1. there are services which it makes economic sense to consume collectively rather than individually. Buses are an example. Once Brighton has invested in its 64 buses and established its schedules it costs almost nothing to take on extra passengers. At peak hours there may have to be some kind of rationing (and this could be by charging higher fares as British Rail do) but in off-peak periods it would make most sense not to stop people getting on a bus because they couldn’t afford it, but to make buses free and cover costs through an annual contribution from ratepayers;

 

1. then there are those services which we could call the caring services which we feel should be available to all in need and not just those who can pay. Health services are a prime example, or the care of the sick, the handicapped, the elderly, or children abandoned by their parents. Just as in a family meals are not ‘sold’ to children or the working spouse, so we feel it is wrong to introduce money and the market into the supply of these caring services which meet a deep and incapacitating need. When the Council cuts laundry services for the incontinent it is shifting the supply of this service onto the private market, the private friend or the family;

 

iii. then there are services which benefit not just the individual consumer but many others. There is a collective benefit. For example, some people may not mind having rubbish outside their house, and will wait to remove it themselves. But the neighbours may suffer – from the smell, the sight and the rats. So a regular free refuse service benefits everyone. The same is true of health, education or congestion on the roads. If an extra person drives onto already congested roads, the greater congestion that results affects not only the one driver but all drivers together. So measures to cut road congestion (for example cheap bus services) benefit everyone.

 

So the increase in charges means either a reduction of services, or an attempt to shift the burden of financing away from those who do not use the services anyway (such as those who send their children to private schools, who pay for private tutors and private servants, or who travel solely by private cars rather than public transport).

 

Rates and Grants

 

Rates, having fallen consistently since 1965 (from 56% of East Sussex revenue in 1965 to 30% in 1977), have in the last five years risen once more along with monetary restrictiveness to reach 42% in 1982. Indeed since 1974, while total East Sussex revenue in real terms has fallen by 1%, the rates contribution has been increased by 22%. The central point to note about this – as will be clear from Chart 2 – is that rates have been forced to rise only because the Government have cut their grants. It is not the profligacy of East Sussex, but a studied cutting of Government support for a range of services, 90% of which the County is required to provide, that has been responsible for rising rates in East Sussex.

 

Before re-organisation, the share of government grants remained steady at about 43%. It then rose in the first three years of the Labour Government to 53% (by 1977), but has now been sharply cut back to 38% (by 1982). In real terms the Government contribution to the East Sussex budget has fallen by more than a quarter (28%) over these five years. This is a startling figure. It reflects a strategy of shifting the costs from the centre to the locality, and then arguing that the increase in local costs was the result of profligate councils. In fact, there has been no rise in overall East Sussex expenditure in real terms since 1974.

 

For Brighton the picture is a bit different. Here the Council – with fewer obligations to spend – has consistently reduced rates so that they have fallen by 32% in real terms since 1974. Chart 3 shows the fall, which we can see in the fact that the rate contribution to Brighton’s income has gone down from 27% to 17% between 1974 and 1982.

 

If we remember that this cut was taking place at the very moment that the conference subsidy was growing so massively, the pressure to raise other charges and cut real services becomes clear. In the early years of the Labour Government (1974 to early 1977) the Government contribution increased by 60%. Since then it has been cut back so that it is now 42% above its 1974 level. The burden instead has been put on the users. Rents, fees and charges rose by 19% since 1974, more than making up for the fall in rates. In other words, in order to keep down the charges on the owners of property, Brighton Council has consciously shifted the burden of financing local services onto those least able to pay. When we contrast the situations of the council tenant, the bus passengers, or the adult education student, – each faced with rising charges – with that of the conference delegate, armed with an expense account for hotels but contributing nothing towards the deficit on the Conference Centre itself (and there were 46,340 conference delegates in 1981), then this grim parody of local democracy becomes all the more shocking.

 

Water Rates and the Overall Rate

 

To Brighton ratepayers it seems that their overall bills have gone up astronomically. When we look at the figures it is clear why. A town that was paying £5 million in 1969 was charged £36 million in 1981. Making allowance for inflation this is an increase of a third.

 

This makes the sharp fall in Brighton Council’s own rate income all the more striking. Part of the explanation we have already touched on, namely the cut in government grants to East Sussex which had to be made up by raising the contributions Brighton ratepayers make to the County. But for the period 1974-81 this accounts for only 11% of a 36% rise. By far the greatest part of this increase has been caused by the rise in water rates.

 

The Southern Water Authority has raised its rate from 5p in the £ in 1974 to 27.5p in the £ in 1981. Allowing for inflation this means that water charges have effectively doubled. Indeed in 1980/81 the water rate exceeded the total rate for Brighton District Council whereas it was only one quarter of the District rate in 1974. Brighton ratepayers have paid more than £6½ million in each of the last two years to the Southern Water Authority. More work is needed on the Southern Water Authority, but it looks, from a first inspection of their accounts, as if there are two reasons for this massive increase in charges:

 

1. unlike local government, the water authorities now receive little government aid. They therefore have to pass on the general inflation in their costs – particularly in interest rates – directly to ratepayers;

 

1. the Southern Water Authority tries to balance out subsidies in their area (which runs from Hampshire to Kent) by raising their charges in Sussex in order to lower them elsewhere.

 

But since the Southern Water Authority’s current spending rose only marginally while capital spending actually declined in the second half of the 1970s, it is the changing system of finance that has led to a greater contribution from Brighton ratepayers.

 

Local Indebtedness

 

The only counteracting factor to the financial squeeze that both Councils have faced has been a reduction in the real value of their outstanding debt. In 1981/2 Brighton owed £88 million and East Sussex £71 million, as against debts of £33 million and £8 million respectively in 1964/5, and of £66 million and £52 million in 1974/5. So there has been a steady upward trend in the amounts both councils owe.

 

Inflation, however, has eroded the real value of these debts. If we adjust the figures to take account of inflation, Brighton’s debt has fallen to almost a third of its 1965 value, and that of East Sussex, which rose up to the time of re-organisation in 1974, has almost halved since then.

 

Inflation always favours borrowers if the interest rate does not rise enough to compensate for the general rise in prices. This has been the case for both local Councils. Many of their earlier loans had a fixed interest rate attached to them. In recent years, therefore, they have often been paying negative interest rates. This means, in effect, that they were being paid to borrow.

 

The resulting transfer of funds has not been used to expand local spending but to run down their long-term debt. In this way both Councils have been spending less than they earn. They have been saving rather than consuming. Had they spent this windfall from inflation we would have seen either deficit financing of their current budget or an increase in their capital programme. Put another way, they would have increased their borrowing so that in real terms the value of their outstanding debt would remain the same. In the case of Brighton for example, the Council could have borrowed a further £148 million for capital projects and still had the same real value of outstanding debt as in 1965.

 

In both Councils we have seen the opposite in the last seven years. Indeed East Sussex transferred current revenue to its capital account in a number of recent years. Both Councils can thus be seen as the very models of ‘parsimony’ and ‘good housekeeping’. They have not been financing themselves on hire purchase, but from their own income, and saving some of it to repay their debts.

 

Summary

 

This chapter has concentrated on the finance of local spending. It showed first that the monetarist argument that local government borrowing from the money market drew scarce capital away from private industry was the opposite of the truth. Between 1974/5 and 1981/2 Brighton and East Sussex paid out more than £132 million in interest and raised loans (net of repayments) of less than a quarter of that sum. We suggested rather that local government borrowing has been something of a safety valve for the owners of money capital who have found investment in private industry increasingly less secure. A similar argument would hold for any central government borrowing from the money market that was undertaken to finance government grants to Brighton and East Sussex.

 

When we turned to how current finance was made up, we found that government grants contributed less than a quarter of Brighton’s income (23% in 1981/2) but rather more of East Sussex’s (38% in the same year). Both these figures represent a fall in the proportion contributed by the Government (in 1969/70 for example the figure for Brighton was 25% and for East Sussex 45%). Since re-organisation, the fall in the real value of central government grants to East Sussex was more than eleven times the modest rise in equivalent grants to Brighton. The evidence we have suggests that government grant contributions to District and County authorities in East Sussex have fallen in real terms since 1974.

 

The Government has intentionally shifted the main weight of financing from national to local shoulders. The switch for East Sussex and the Southern Water Authority has meant a sharp increase in rates in spite of effectively static services. This has been coupled with a long-term increase in the charges made to consumers both for the County and for Brighton.

 

The rise in commercial rates we argued might in the short term increase business costs, but in the long term would lower property income without serious effects on productive investment. The increase in domestic rates and in user charges would, for the majority, in fact reduce real wages. This may in part depress the level of private consumption. But more important, it is part of a much wider strategy to shift the burden of taxation from the profits of private industry to the incomes of working people. It is a strategy of redistribution. Its results under Mrs Thatcher’s Government have been most obvious in the increased taxation of middle- and lower-income groups since 1979. What this chapter has shown is that the same process has been at work in a less obvious way in the financing of local government. The increase in rates has led Brighton and East Sussex councillors to attack many services more sharply. The increase in rents, in fees and in charges, has meant a further tax on those who depend on the remaining services, and a further burden on those who cannot afford them.

 

Chapter 7

 

The National Picture

 

A number of economists with whom we discussed our findings for Brighton and East Sussex said that both were probably special cases. Seaside towns have a remarkable record for councils who favour private interest rather than public need. East Sussex, too, has for many years been marked out by the size of its Tory majority. So if there had been no ‘party on the rates’ for the great majority of us in this area, perhaps the festivities were taking place elsewhere.

 

The Authorised Version

 

In Chapter 2 we gave a number of the figures which – suitably framed – no doubt hang above the mantelpiece in No.10 Downing St. For the period 1964-80, total Government spending rose from 41% of GDP (at factor cost) to 52%. Local authority spending went up from 12.5% in 1964 to 15% in 1980 (after a peak of 18% in 1974). The same is true for employment. While total employment remained almost constant at 25 million, jobs in local authorities rose from just under two million in 1964 to over three million in 1980. These are grand facts, which have been used to attack local spending over the last seven years.

 

An Alternative Reading

 

If we apply the points raised in Chapter 3, we can offer some quite different grand facts:

 

– between 1964 and 1980 the national economy (GDP) grew by 38% while local spending only rose by 14%

 

– the share of local authority spending in GDP fell from 13% of GDP in 1964 to 11% in 1980

 

– between 1974 and 1980 local authority spending collapsed by 14% in real terms.

 

The result was that many public services declined in standard, even before the concerted attacks of monetarism. The slum conditions of public services in Brighton find many echoes in other parts of the country.

 

The Transfer Factor

 

We will briefly discuss the evidence for this alternative reading. First, the local spending figures quoted by politicians include many items which are purely financial transfers and not demands on the country’s real economic resources. It is clearly absurd to include in local spending figures the amounts for national taxation which go straight back to the national Exchequer. Then there is interest which is a transfer to owners of money capital and belongs to the sphere of monetary distribution. The same is true of subsidies and grants.

 

We recalculated local authority spending excluding subsidies, grants and debt interest, but including taxes and National Insurance which were difficult to estimate with certainty. We then adjusted the figures for inflation (using the Government index) and compared them to GDP (adjusted for inflation with the GDP index). From 1964-74 there was a slight increase in the local authority share of national production (from 13.1% to 13.5%). This agrees with the findings of another Brighton economist, Julian le Grand, who with a colleague attempted a similar exercise and found a rise in the local authority share from 11.1% in 1964 to 12.7% in 1974 (compared to the unadjusted ‘authorised version’ showing a rise from 12.5% to 18.1% in the same period). For the six years after 1974, our estimates show a fall in proportion of GDP from 13.5% to 10.8%, and a massive cut in the real value of local authority spending of 14%.

 

For the period 1964-80 as a whole, while GDP grew by 38%, local authority spending, excluding subsidies, grants and debt interest, grew by only 14%.

 

The Population Factor

 

The rise in population was a major factor explaining the rise of spending in East Sussex. There has been an increase (although less marked) in the country as a whole, particularly in the number of young people and those over retiring age. Even to maintain the same level of services to these groups (who account for a majority of all council spending) means expanding overall council spending and employment.

 

In Table 1 we show percentage changes in all local authority spending per person between 1964 and 1980.

 

Table 1

 

Changes in Per Capita Local Spending in Great Britain and Brighton (constant prices) in percentages

 

                        National LA Spending East Sussex      Brighton          GDP per head

1964/73                       52                                36                    -3                     26

1974/80                       -16                               -2                     -8                     7

1964/80                       25                                38                    n.a.                  33

 

Note: East Sussex and Brighton figures are for the financial years beginning on the 1st April in the year named.

 

These figures have not been adjusted for the financial transfers (as in the previous section) so that they can be more easily compared to the changes that took place locally. What we see is national local authority spending running well ahead of both East Sussex and the national economy, but then collapsing in the second half of the 70’s. For the period as a whole it grows by only 25%, and if the financial transfers are taken out, by only some 10%, as against a 38% rise for East Sussex and a 33% growth in the national economy. This is the evidence for the idea that local government is taking a smaller proportion of national non-monetary resources in 1980 than it did in 1964.

 

Use Values

 

The above estimates took into account the fact that the costs of government services increased faster than the prices of the outputs of the private sector. The resulting figures are approximate measures of how the physical quantities of local services have developed in comparison with the physical quantities of marketed goods. This is what we are interested in: not the statisticians’ values, but actual goods and services which ordinary people consume.

 

Table 2

 

Increases in Number of Manufactured Goods

 

                                    millions                          

                                    1961    1971    1978      

Carpets (sq yards)       67        132      170

Divans                         1.41     2.04     2.30

Watches                      3.0       4.2       6.7*

TVs mono                   1.5       1.6       0.75

colour                          –           1.5       1.7

Vacuum cleaners         1.4       2.6       2.8

New cars                     n.a.      1.3       1.6

Motorbikes                  n.a.      0.14     0.23

Dolls                            2.0       6.4       16.6

Indoor games              3.1       8.3       35.8

Beer (gallons)              1,030   n.a.      1,440**

Wine (gallons)             28        n.a.      100

Spirit (proof gallons)   16        n.a.      38

Tobacco (lbs)              259      220      218*

Gramophone records LP         20.4     72.3     106.2

 

Notes:

*1977

**1980

n.a. = figures not available.

 

Source: Annual Abstract of Statistics; Social Trends; CIPFA. 145

 

 

At the national level it is quite clear that there has been an explosion in the supply of many goods that can be bought over the counter. Table 2 gives some examples.

 

These figures show important changes in many lives over the last twenty years and even in the last decade. Two thirds of households now have telephones at home, 92% have fridges, 58% cars, 66% colour TVs, 77% washing machines. The figures in 1970 were respectively 35%, 66%, 52%, 2%, 65%. They give a picture of a flourishing sector of private consumption.

 

Set against this we have a public sector which – at the local level – has in many spheres remained stationary or even slipped back. Nationally there are two services which have been severely cut, milk and meals for children and public transport. In 1967 the annual average number of school meals served per pupil in the country was 143. By 1978 it had fallen to 123, and real spending on it fell by 10% between 1974 and 1980. The recent cuts have been even more severe, both nutritionally and in the numbers served. The recent decision by Merton Borough Council in London to end its school meals service is the culmination of a sustained attack on an important part of the welfare state in the post-war period.

 

Public transport is collapsing equally rapidly. The figures are given in Table 3.

 

Table 3

 

Public Bus Services in Britain 1965/80 (Municipal Operators)

 

            Services provided        Passengers carried     Average fare (constant prices)

            (vehicle kilometres)    

            million                         million   

1965    290                              3,025                           2.61

1977    250                              1,077                           7.89

% change

1965-77           -14                               – 64                              +202

 

Note: constant prices were obtained by deflating with the consumer price index.

 

Source: Ministry of Transport, Transport Statistics.

 

Services have been cut. They have become slower with the introduction of one-person operators. The average fare has trebled in real terms. Not surprisingly the number of passengers has fallen by two thirds. The national decline is even more striking than that in Brighton, where passenger journeys fell by 65% over a 20 year period (an average fall of 3.2% a year as against the national fall of 5.3% a year) and prices rose at only half that rate.

 

Other services have expanded more slowly than the growth in numbers of the groups they serve. In other words they have failed to keep pace with need. During the 1970s places in homes for children fell by 4%. The number of people over 65 went up by 11% between 1971 and 1977, but the places per head in homes for elderly people fell by 6%. As in the case of East Sussex there has been a switch to much cheaper forms of home care: fostering for children, meals-on-wheels and home helps for elderly people.

 

In education, spending per school child has lagged well behind the growth of the national economy since 1964, and for the period between 1974 and 1979 spending per head on secondary school children actually fell. The figures are given in Table 4.

 

Table 4

 

Real Spending per head on Education in England and Wales (1975 = 100): % change

 

                                    1965-1974                               1974-1979

                                    England & Wales        East Sussex      England & Wales        East Sussex

Primary and Nursery   13                    13                    3                      3

Secondary                   4                      4                      -4                     -4

Milk and Meals           2                      -6                     -10                   -4

All Schools

(incl Milk and Meals) 8                      4                      0                      0

 

Note: the East Sussex figures are for the financial years 1973/4, 1974/5 and 1978/9. The national figures are for the years stated.

 

Sources: Dept. of Education Statistics, and East Sussex County Council.

 

Table 4 shows the national picture to be very similar to the local one. There is a small increase in the decade before 1974, a slight rise in primary spending since then, as numbers fall, but a striking fall in spending on secondary school children as on milk and meals. Just as school sizes have grown in East Sussex, so they have in the country as a whole (from an average size of 481 children in 1964 to 833 in 1978). While there has been an improvement in teacher-pupil ratios for England and Wales (from 28.3 to 23.4 in primary schools and from 18.7 to 16.8 in secondary schools, between 1964 and 1978) this has been offset by a fall in the quantity of new building.

 

Services which do seem to have grown faster than the national economy over the period from 1965 are Further Education and the provision for physically and mentally handicapped people, though since the mid-1970s per capita spending in Further Education fell (by 18% between 1975 and 1979). There was also a big increase in the number of swimming pools, sports centres, and country parks, particularly during the first years of the Labour government in the mid-1970s. We could add other things like the reclamation of derelict land, civic amenity waste disposal, meat inspection, the preservation of buildings, all of which expanded. The stock of library books in the country increased though smaller public libraries were closed, so that library facilities, like schools and hospitals, became more centralised. Services such as these, however, are only a small part of council budgets.

 

The Capital Replacement Factor

 

Another area where there was substantial expansion in the 1960s and early 1970s was in the rebuilding of the urban fabric. Much of the urban development of the late 19th and early 20th centuries was coming up for renewal. This was true of houses, hospitals, schools, sewage and water systems, and of road layouts and town plans. The Plowden Report for example showed that in 1962 60% of primary schools had been built before 1902, and 30% before 1875.

 

What we should note, however, is that after a sustained construction programme in many of these fields up until the mid-1970s, new capital investment has been one of the most severely cut of all areas of local authority expenditure in the past few years.

 

Let us take housing as an example. Housing made up nearly one sixth of local government spending in the mid-1960s. Between 1964 and 1974 it grew by 46%, slowing somewhat during the period of the Heath government, but recovering in the first years of the Labour government between 1974 and 1976. By 1980 however new housing investment was only half its 1974 level, and made up only 7% of local government spending.

 

A fall in house building does not of course mean that housing standards have got worse. With a capital asset of this kind we have to take account of the wearing out of old stock and compare it to the rate of replacement. Some estimates are given in Table 5.

 

Table 5

 

Local Authority Housing and Depreciation (000’s)

 

                                                                                                1969    1979      

No. of council houses                                                             4,600   5,244

Houses in need of renewal (assuming 40 year life)                            115      131

New council houses built                                                        185      102

Percentage of new houses built to number in need of replacement    161      78

 

Source: CIPFA.

 

So in the late 60s the country was adding houses over and above those that needed replacing. Now, building is not even covering those that need replacing. Table 5 also tells us that the actual number of council houses (apart from those knocked down for replacement) has risen over the decade by 14%. This is nearly three times the increase registered in Brighton (5%). What we do not know is whether the living space available has increased. Nor do we know whether the houses that are in use have been kept in repair and have retained their standards over the years. One broad measure is the proportion of council houses which are classed as ‘not reasonably suitable for occupation’. This can be for reasons of repair, stability, freedom from damp, internal arrangement, natural lighting, ventilation, water supply, drainage and toilet arrangements, cooking facilities and the disposal of waste water. By 1976 the figure for council houses nationally was only 1% of the total housing stock. This suggests that over the decade, public housing provision has probably improved significantly, even allowing for some loss in space. Certainly the national picture looks much better than that for Brighton. An internal survey done by Brighton Housing Department in 1978 showed that of Brighton’s council houses, 8% were unfit. For those built before 1945 (which made up two-fifths of Brighton’s council housing) the figure was 19%. Even the redevelopment of Whitehawk will leave Brighton with four times the rate of unfit council houses compared to the country as a whole.

 

The General Picture

 

The national evidence shows clearly that Brighton and East Sussex are in no way exceptional in their patterns of spending. In education we have followed the national trend. The same is true of social services, although the proportion of places in residential homes for elderly people is only half that for the country as a whole. In transport the national decline of municipal bus services has been even worse than in Brighton. In housing, Brighton’s record is well behind the level of national performance, as it is in the provision of many recreational facilities. The priorities of a local council do therefore have some significance. It does matter who controls the council. But having said this, it is equally clear that for the country in general there has been no major spending spree at the expense of the private sector.

 

Twenty years ago an American economist, J.K. Galbraith, pointed to the fact that in America there was ‘private affluence and public squalor’. The same is increasingly true in Britain today, as monetarism cuts further into public services. But all this is hidden by the government statistics which say that the opposite is the case, simply because of their methods of accounting. When we look again at this accounting and peel away the assumptions, it is clear that local councils, far from being spendthrift, are the poor relations in the British economy.

 

While the number of private cars continues to rise, public transport declines. While consumer durables roll off production lines, with one new model replacing another, our public education system and our social services are failing to keep up with expanding numbers and widening needs. Is it any wonder, then, that the attacks on public spending by government ministers, or by our Councillors from Patcham and the villages of East Sussex, make us angry. For, as we can see, the accusation that we have had a ‘party on the rates’ is a travesty of the truth.

 

Chapter 8

 

The Meaning of Monetarism

 

MONETARISM is like modern medicine. It treats symptoms rather than causes, and takes the knife to parts which can only be properly treated as elements of an organic whole.

 

One part of the monetarists’ attack on local government, for instance, was the suggested link between local spending and inflation. For the monetarists inflation is simply caused by too much money in the economy. It has no necessary connection to what is going on in the material economy, to the production of goods and their distribution. To control inflation it is only necessary to control the supply of money. Milton Friedman, the American professor who is the most famous architect of Mrs Thatcher’s monetarism, appeared on television beside a printing press which was producing dollar bills. To control inflation he said it was only necessary to stop the press. Or, in another of his famous images, all you need to do is to stop throwing money out of helicopters.

 

Monetarism and the Market

 

In practice there were two ways in which the Thatcher government thought it could control inflation. The first was directed at the private sector, the second at spending by the state. In the case of the private sector, the Government thought it could control the money supply by restricting the demand for money. It aimed to do this by increasing interest rates. This would make it more expensive for companies to borrow money from the banks and thus reduce their demand for money.

 

The Government had other motives for raising interest rates. As interest rates rose, more money from abroad would be attracted into the country, so that foreign money-holders would want to hold sterling and therefore bid up the exchange rate, the price of sterling on the international money markets. When sterling rises, exports become more expensive overseas, and imports are cheaper at home (because we now pay less sterling to meet the same price in German marks or US dollars). British manufacturers face greater competition; they cannot raise their prices because imports would undercut them, and therefore inflation or the increase in the general price level stays down. This was the theory of monetarism proposed by the London Business School, one of whose economists became the chief economic adviser to Geoffrey Howe’s Treasury.

 

The plan was spelled out before the election and on many occasions since. It has also been followed in practice. The 12% interest rate which held at the time of Geoffrey Howe’s first budget rose to 17% within a year. The exchange rate which had been less than 1.60 dollars to the £ in late 1976, and stood at 2.07 at the time of the election, had risen to nearly 2.50 dollars to the £ by late 1980. All British companies who faced competition from imports were squeezed. Industrial output fell by 12% between 1979 and 1981. Manufacturing profits from a 1978 level of 6.8% fell to 2.1% in 1981. The squeeze was on.

 

Unfortunately for Mrs Thatcher, the money supply wouldn’t respond immediately. The Government, following the advice of monetarist economists, had set targets for the rate of growth of one specific measure of the money supply, Sterling M3. This was to be the compass which would guide their policy. The plan, announced in the Budget of March 1980, was that growth in the money supply, as defined by Sterling M3, would be gradually reduced in successive years. But far from falling, Sterling M3 increased by leaps and bounds and by 1981 was growing by 20% a year. (This was despite the fact that inflation, which had been sharply increased by the Government’s decision in 1979 to raise VAT to 15%, had already started to decline from its peak of over 20% in the summer of 1980.)

 

What appeared to be happening was that firms – facing foreign competition and falling demand – were borrowing from the banks to finance their growing unsold stocks. In other words, money in the sense of credit was being created by the banks to prevent firms going bankrupt. The point, as Alan Budd (one of the Government’s leading economic advisers) was forced to admit in December 1981, was that raising interest rates actually increased the money supply rather than controlled it. By 1982 the plans for controlling the money supply were quietly revised.

 

In the real world of production and consumption, the effects took a grimmer form. National output was actually falling from early in 1980 to early in 1982. Unemployment rose from 1.3 million at the time of the 1979 election to 2½  million in mid-1981 to 3 1/3  million in September 1982. By April 1983, if those who are unemployed but never registered are included, the number unemployed has reached four million people. Professor Friedman, his English intellectual followers, and government ministers, all said that the monetary economy was quite separate from the material economy of goods and services. They said you could control inflation by reducing the growth of the money supply without affecting production. In practice the only way in which the monetarists have cut the rate of inflation is by the most savage attack on production. There was in any case a serious international recession. Mrs Thatcher intentionally made it worse, forcing the rate of increase in British unemployment up to twice that of the rest of the world. At the start of 1982 even pro-government commentators were admitting that Mrs Thatcher’s policies were a major cause of the rapid rise in unemployment. By the end of 1982 she was, like a doctor, congratulating herself for stopping a cut bleeding, but she had done it by attacking the flow of blood from the heart itself. Inflation has not fallen because the Government controlled the money supply. It has fallen because it forced so deep a recession that it has cut off monetary demand.

 

Faced with this evidence of waste – of people unemployed, of enterprises destroyed only to be replaced by imports, of good machinery melted down for scrap, of empty offices and factories – many economic commentators have called monetarism a strategy of economic madness. Certainly in the narrow way it is often presented it is hard to see any sense in it.

 

But in practice monetarism has another meaning. Here it has been a complete success. This meaning was spelled out as part of the London Business School strategy and has been celebrated by Mrs Thatcher. It makes Geoffrey Howe the effective Minister of Employment with Norman Tebbitt left as the sweeper-up. The issue in question is labour. What monetarism set out to do was to use the control of money as a way of disciplining labour, cutting real wages, weakening the unions, undermining the means of shop-floor defence against the demands of the conveyor belt and continuous production techniques. Money – which Mrs Thatcher likes to speak of as the innocent medium of exchange – has been turned by her into an instrument to control people at work.

 

When we outlined the workings of monetarism above we left out the end of the story. After interest rates have been raised, and with them the price of sterling, after imports have come in and undercut the price of UK goods, then, so runs the argument, British firms will have their profits squeezed. So they will not be able to give way to demands for wage increases. The theory was spelled out clearly in the books and papers of the monetarist economists: interest rates and the price of sterling must be raised as a way of cutting real wages.

 

This part of the strategy has worked all too well. Firms have not only been squeezed; they have gone bankrupt. Large firms have closed plants and amalgamated them. Rising unemployment undermines those in work and forces those out of work to accept wages and conditions they would never have accepted before. The real value of wages for many workers has fallen. Unions have lost membership. Employers have been able to introduce a technical and supervisory tyranny on the shop floor. This can only be called ‘measures to increase productivity’ by those who do not have to work under such disciplines.

 

Mrs Thatcher’s monetarism has been far more successful in breaking the defences of working people than any incomes policy or any Employment Act. This is why the CBI and the Tory Party have supported it, in spite of the fact that the policy has left the balance sheets of many CBI members in tatters. The main opposition to monetarism within the Tory Party has come from the ‘wets’. They are largely made up of the landed interest. Willy Whitelaw, James Prior, Geoffrey Rippon are farmers and landowners who do not have these problems of labour discipline. They operate a rural paternalism that is disturbed by the sound of monetarism on the march.

 

When Margaret Thatcher met Ronald Reagan after his election as President of the United States, it was her success in using monetary policy as an instrument of discipline in the private sector that drew his compliments. Where she had failed, in his opinion, was in the public sector.

 

Monetarism and the State

 

Manipulation of the money markets is a blunter instrument in the public sector. High interest rates raise the cost of public services, but for the most part they cannot bankrupt them. Nor can the international market be summoned up to discipline the state as it has done private industry. It is harder therefore to put pressure on state workers. In British Leyland the Michael Edwardes plan was enforced by a mixture of the threat of foreign competition, and of prospective bankruptcy if the Government withdrew its financial support. In the state sector generally, the Government has used its financial power or power of the purse to force through cuts in real wages and/or measures to increase labour output. This we have seen in British Rail, British Steel and the National Bus Company.

 

What has made even these forms of control difficult to enforce is the fact that many state industries and state services have unions which are co-ordinated at a national level. The coal, steel and railway unions can present a more united front to a single employer than is often possible in a private industry with many different firms. This also applies to local government. There are for example over half a million teachers and lecturers currently employed by local authorities, largely organised in national unions which bargain centrally on pay and conditions. The same is true for many local authority workers in NALGO and the General and Municipal Workers Union. Local authority workers are also in a stronger position because they are not subject to market competition in the way that British Leyland or British Airways are.

 

The Cuts

 

The main way in which the Government has tried to control local authority workers is through the cuts. It is this as much as the aim of cutting the money supply which has been behind Mr Heseltine’s attempts to cut local spending. He talks about profligate councils and excessive services. We have shown that this is not so. The Ministers have evidence of their own (often written in professional journals by hard-pressed local officials) that many services are declining rather than expanding. The Treasury for its part has emphasised the overall level of spending and its inflationary effect. The evidence in this book suggests that this does not hold water either. Indeed on the state budget more generally, Mrs Thatcher’s monetarism has seriously backfired. Rising social security and unemployment payments have pushed up the Public Sector Borrowing Requirement rather than lowered it.

 

The difficulty for the government monetarists was that Whitehall did not directly control local councils. The main form of control they have is the annual government grant distributed to local authorities. Until 1980 this money, known as the rate support grant, was given according to a formula which tried to distribute the grant fairly, according to geography. Some areas had higher rateable values than others. They could afford to finance more from their local budgets. One part of the government grant (called the resources element) was then given to those areas which had lower than average rateable values. In 1980/81 for example the average rateable value per property in the country was set at £178. If a council’s average rateable value was lower, it received the difference between its average and £178. In that year Brighton received £3.2 million in resources grant, indicating that its average rateable value was some £27 below the national average.

 

A second part of the government grant related to needs. Some councils have very different levels of need within them; more old people, more single-parent families, more primary school children and so on. A computer balanced out the needs of the various councils to determine what proportion of the national total they received. Until 1978 the need grant went entirely to the County Councils. After that, District Councils also received a share. In 1980/1 Brighton’s share was £2.6 million.

 

There were a number of problems for Heseltine with this system.

 

First, when the Government decided what proportion of total council spending it was going to finance in the year ahead, it had to guess the rate of inflation and rate of increase in wages. If their guess was too low, more money would have to be found during the year, some of it from the Government. Local councils therefore had less reason to resist wage and price increases (unlike their counterparts in the private sector).

 

Second, if councils provided a high level of services, they tended to get a greater proportion of the government grant because of the way in which the needs and resources elements were worked out.

 

Third, if a council wanted to provide a high level of service, they could fund any shortfall through raising rates, thus escaping monetary discipline.

 

From 1980 onwards Heseltine introduced successive measures to tighten his control. The most important was known as the block grant. This replaced the needs and resources elements we discussed earlier. Instead of settling a total figure and distributing around the different local authorities according to the needs and resources formula, the Government tried to calculate what each council should spend on providing particular services. This was called ‘grant related expenditure’. In the case of Brighton the Government calculated that it should spend no more than £10.3 million on providing its services. Brighton would receive its grant based on that figure. But the amount of grant would fall the more spending exceeded the Government’s target. This was really a cash penalty.

 

The block grant was introduced for the financial year 1981/2. It still did not stop overspending, particularly since a high rate of inflation pushed up spending in cash (but not in real terms). So, in the same year, Heseltine introduced a new set of guidelines based on the spending councils had done in 1978/9. He told councils to reduce their spending below the 1978/9 level by 5.6% (after allowing for inflation). Otherwise they would face loss of grant from the Government. This was a new set of rules and a new set of penalties. The problem was that the estimated spending levels set by the Government were different as between the adjusted 1978/9 figures, and the grant-related expenditure targets. For some councils the grant-related figure was higher, in others it was lower. The figures varied by as much as 20% either way.

 

Many councils which had introduced savage spending cuts still found themselves penalised under this system. It simply did not work. Further, there were councils which resisted cuts and raised the rates to maintain standards, particularly where inflation had run them short of cash. Heseltine’s reply was to forbid a council from raising a supplementary rate part way through the year.

 

In 1982/3 he moved further. Not only did he cut the Government contribution to estimated council spending from 59% to 56%. Now, for the first time, he said that he would work only in cash terms. For example, let us suppose that previously Brighton was estimated to spend £10.3 million. If inflation was higher than expected, then the Government would make up their share of the difference in a supplementary settlement. Now this was going to stop. If inflation rose more than expected, then the Council would have to cut. In 1982/3 the Government estimated that council wages would rise by 4% and inflation by 9%. These were both less than was generally expected. But in this way the Government aimed to force councils to keep wage increases down to 4%, well below the rise in prices, which would mean a cut in real wages.

 

Nothing more clearly shows the Government’s priorities than the introduction of this system of cash planning. Previously government spending had been planned in volume terms, on the basis, for example, of the actual number of schools to be built or teachers to be employed. The monetarists have now changed all this. They plan only in terms of cash. The cabinet takes its decisions purely in cash terms. Some government departments still collect figures for ‘volume’ but, in the words of one government official, this is “not with Treasury encouragement”. In short they are no longer concerned with the standard of services but only with money payments. The resulting plans were described by one Parliamentary economic adviser as “virtually incomprehensible”.

 

We have gone into the detail of all this to show the chaotic character of the measures, and how difficult Heseltine found it to curb those authorities which were committed to maintain their services. Even more serious from his point of view was the fact that when cuts had to be made, it was capital spending and various bought-in services (school buildings and books for example) which went first. These cuts had serious effects on private industry. What Heseltine was really looking for was cuts in employment, in wages, and in the conditions of work.

 

It was here that the public sector unions have played a key role. They have undertaken joint action to defend the level of wages, of employment and of services. In Brighton, this book has shown how the pressures against the council workers have had their effect: with new time and motion study and routing among the refuse collectors; pressure on the bus drivers (the strike at Southdown was centred on the management attempt to increase productivity at the expense of the driver’s home life); and the loss of jobs, particularly for part-time workers, like lollipop patrols and dinner ladies. Yet in spite of the set-backs, the strength of the resistance locally and nationally has meant that the cuts have not been as easy to make as the monetarists would have wished, and certainly not as severe as has happened in private manufacturing. In all between 1975 and 1982 overall employment in local authorities in England and Wales has fallen by only 43,000 people or 2%. This fact symbolises the awkwardness of the public sector for monetarism.

 

This, then, is the central point at issue in the cuts: the level of services and the conditions of those who work in providing our services. It is not a question of ‘overspending’ and a ‘crowding out’ of private capital through over-borrowing. The Government knows that the services are declining. But their general purpose is to improve the position of private enterprise at the expense of those who do the work in factory and office. The policy of local council cuts is part of this wider strategy.

 

In Chile, where Professor Friedman’s monetarism was given its first trial run, the dictator General Pinochet was more successful. Between 1973 and 1976 he cut state employment by 30%. He had nearly halved spending on health, education and housing by mid 1975. This is a measure of the economic logic of monetarism in conditions where unions have been broken and their leaders imprisoned.

 

Privatisation

 

In Britain, the inability to dismantle the welfare state at the local level is one of the key failures of Mrs Thatcher’s government. It is still at the centre of her attention. The Government is now devising other ways of achieving similar ends. In July of 1982 the Institute of Directors produced a paper on the subject which is thought to reflect ideas currently circulating in the government. It was called “Some Thoughts on the Tasks Ahead” and centres on the question of how to break the strength of the public sector unions. It discusses a variety of measures:

 

1. negotiating ‘no strike’ agreements with public sector unions, with compulsory arbitration in disputes. The paper sees a number of difficulties which make this course unlikely;

 

1. terminating closed shop agreements in the public sector. Again it sees little hope of bringing this about;

 

iii. decentralising services as far as possible ‘so that employees identify not with an entire industry-wide organisation but with their local employer’. Similarly collective bargaining arrangements should be made on a local basis, so that where there are breakdowns in negotiation, any subsequent strike would be localised. It would then be less likely to draw in the whole industry. For local authorities this would mean dismantling national bargaining arrangements, so that responsibility for negotiations rested with the individual employers;

 

1. a ‘massive programme of privatisation’. This is called the most obvious and most desirable method of achieving the above aims. It would:

 

– ‘present employees with the choice between accepting market realities or reducing their job security’

 

– help employees identify with their private employer rather than an industry-wide organisation (any industrial action taken on an industry-wide basis would therefore be secondary and thus fall within the provisions of the Employment Act 1980)

 

– tend to make bargaining arrangements (and thus the scope of industrial action) far more localised than at present.

 

The paper suggests that there should be a piecemeal approach, introduced first in weaker industries. This ‘would gradually isolate those sectors which initially might find such changes wholly unacceptable and would lessen the possibility of secondary industrial action being taken in their support’. In a final survey of the trade unions the paper concludes ‘the priority for action must therefore be to break the bargaining monopolies in the public sector’.

 

The drive for privatisation is well under way all over the country. Wandsworth Borough Council in London has subcontracted its street cleaning, refuse collecting and grass-cutting to private firms. Refuse collection and street cleaning have also been privatised at Southend, Merton, Tandridge, Wirral, Bath, Kensington and Chelsea and Taunton Dene. In these cases, services which formerly involved 1,515 jobs, under privatisation now provide only 923. This is a loss of 592 jobs or nearly 40%.

 

Such job reduction comes about partly through lower standards. In Wandsworth for example 190 streets are not being swept at all, and the penalties on Pritchards the contractors for poor work were becoming so severe that the Council introduced temporary ‘penalty free’ zones. In the Wirral the contractors are asking the Council to allow a change in ‘working practices’ which means a lowering of the standards of service. In Eastbourne the Council has had to increase the number of inspectors by 50% because of the low quality of the contracted out service.

 

There are widespread reports of unreasonable intensification of jobs. For example the firm Waste Management, who manage the Wirral dustbin collection expect their 110 workers to walk 17 miles a day at 3.67 miles an hour shifting three tons of refuse. This is also linked to the lower wage levels (with greater reliance on bonuses) which have been reported in Southend and Wandsworth. More casual labour is introduced, pension rights are lost, and some employers even avoid paying National Insurance contributions by relying on part-time labour.

 

A common area of privatisation is in the field of office cleaning. A survey of private office cleaning firms found that 89% gave no sick pay. Many did not contribute to the pension rights of employees. No allowance was paid for night work. And many contractors raised the norms for the cleaners compared with those in the public sector.

 

What these examples show is that where it appears cheaper to subcontract services for a council, the reason for the lower costs is because of the worse conditions and poorer pay of the workers doing the job. The Government through its strategy of cuts tried to reduce wages and conditions directly. It has had some success in Brighton and East Sussex, and has cut the level of many services at the same time (the social wage). But privatisation is showing itself to be a more effective way of achieving these ends. This is why it is coming increasingly to the fore within the Government’s strategy, both at a local and a national level. It advances under the banner of ‘efficiency’. In fact it is largely a question of wage levels, job security, and labour control.

 

This book has shown the often disgraceful level to which our two Councils have allowed services to sink in recent years. The fact they have not sunk further is in large measure due to the public sector unions, and a succession of community campaigns – Save our Schools, the campaign against the destruction of Whitehawk, and the many others described earlier. The pressure for cuts will continue, supported we suspect by moves to extend privatisation in Brighton (which has mainly been evident in the field of housing and recreation) to other council services. What is important is that new people are ready to help in the defence of our services, and the conditions of those who produce them, and that our many campaigns can continue to support each other and strengthen their links.

 

Conclusion

 

Our argument is that the current recession has not been caused by local council overspending. Nor has it been due to state spending as a whole or indeed to the requirements of workers and their families to have tolerable conditions of work and reasonable wages. In the private sector wages have been depressed by the conditions engineered by monetarism. Public sector wages had changed almost identically with those of manufacturing (looking at the decade 1971-81); while from 1976 to 81 local authority pay had actually fallen by 4% if inflation is taken into account. In the handbooks of international business, Britain is now quoted as one of the lowest wage countries in the Common Market.

 

The problem is to be sought elsewhere – in the workings of the private market economy, where the rate of profit has declined steadily for the last 20 years, and where the capacity to produce has raced ahead not of need but of the monetary demand necessary to finance it. The answer is not to increase demand for this will merely lower profit. The inner difficulties are deeper than that. What we need to do is to move towards an economy where our skills and capacities are used to produce directly for human need. Far from taking public services into the private sector whose problems are the real root of the recession, we should be taking private production into the public sphere.

 

In the past, when deep recessions have hit this country and others in the world, governments have tried to solve the problems of the private economy through attacks on wage earners and on the public services provided to ordinary people. Unfortunately they have often had military ambitions, so that economic crisis has walked hand in hand with war. Mrs Thatcher’s monetarism and her Falklands campaign is a modern version of an old tune. But this time round, in a nuclear age, we cannot let this tune lead us into a dance of death. The link between monetarism and the bomb may not be obvious. This historical link between economic crisis and military campaigns might just be coincidence. But the repetition is unnerving. The militarism of the four great monetarist states, Chile, the USA, Israel and Thatcher’s Britain, seems strangely to confirm the link. At such times what is said and what is done are often very different. This book has tried to understand one part of these events, the economic ones, as they affect us here in Brighton so that our minds need no longer be imprisoned by their interpretations of our lives.

 

Chapter 9

 

What Can We Do?

 

“Old Jesus … if he’s so great why doesn’t he come and help us now? Why doesn’t he come down and settle the unemployment or something? They need to chuck Maggie out, don’t they. We should look into the future, not the past, shouldn’t we?”

Young people in a Moulsecoomb youth club.

 

OUR theme in this book has been that state spending over the last 20 years has not risen out of line with the private economy. Moreover we have exposed the myth, dictated to us by government as an irrefutable truth, that public spending is wasteful, that it is a drain on the economy and that the ‘party on the rates’ must now end. Of course there has been an increase in some areas of local government spending. But in East Sussex, when money has been spent generously, it has been on the wrong things for the benefit of people who are in no need of help: hoteliers, wealthy tourists, property developers and conference delegates who use the Conference Centre at great cost to ratepayers.

 

Most services provided by the local state have not grown. They have declined seriously over the years. They may still seem to be expensive if you look at them from the point of view of money. Things like proper care for elderly people, good teachers, or an efficient bus service cannot be produced more and more cheaply like a batch of plastic dolls in a modern factory. That does not make them less useful, or necessary or valuable. The point we have shown is that there is indeed real waste. The decline of really useful services which are absolutely necessary for the well-being of the country’s real, human resources is where the true waste lies.

 

The local state has long provided public services. They may have originated at times when war was looming, in the recognition that public health, hygiene, education and a balanced diet were in the interests of the State, if only to produce a good fighting force. Nevertheless, they have also met real needs and encouraged people to develop the self-respect and assertiveness to expect and demand more for themselves, their children, their friends. These services have always been organised locally. That has been a strength. Now we face so many problems in stopping their decay, in meeting even the most pressing needs such as keeping old people warm, comforted, clean and cared for, we have to try and recreate this local strength. Only the local state and local people acting together can stop the crumbling away of services and restore people’s belief in their value.

 

Monetarists hate the term ‘collectively’ and knock the idea of ‘co-operation’ – except when they look at their company profits. They mouth the language of individuality while kow-towing to conformity, status, the peerage, military officers. The individualism monetarists really hate is that of people who see through their language to the vested interests they carefully protect. So it may be worth stating the positive and creative reasons for placing co-operation, sharing and partnership as values above selfishness, greed and snobbery. One reason is that we can, together, provide services which no one can provide on their own. Individually we cannot create a library, a hospital, a school, a sports centre, a park. Together, we can.

 

Secondly, from public provision comes public sharing. We are brought together rather than held apart. In this way we can together meet needs which alone might defeat us: the need for medical care, help in old age, the chance to overcome isolation if we are along, financial support when jobs disappear. Once again, the monetarists claim to recognise the issue. They say ‘the family’ or ‘charities’ should step in. But an old person on their own has no family apart from us. And however well-meaning a charity, its effects can only be to increase a sense of dependence and guilt. Public spending, public services are ordinary people’s ways of doing together what we cannot do alone – better, more fairly, and more securely.

 

Thirdly, there is the need for public restraint of selfish or unthoughtful individual behaviour. Many services came about because of the ill-effects of private actions. The contamination of water supplies by effluent led to the regulation of sewerage. Much preventive medicine, like the elimination of cholera and diphtheria came about when well-off people realised that they were as vulnerable to epidemic diseases as the poor. So slums had to be cleared and sanitary conditions improved if rich as well as poor were not to die. The lesson was simple: all people stood or fell together. Although times have changed, we still don’t want the rich regulating us. But we do want to regulate our own conduct for the common good.

 

Alternatives to the patterns of the local state described in this book must be found. They cannot be simply stated, or turned into a quick manifesto. There have already been too many promises and justifications. Real alternatives do not come in books. They can best be stated through people’s own actions, struggles and attempts to rebuild a future. We are living through a time when a right-wing government and the forces around it are destroying all the things which keep local communities strong: the opportunity to work and the energy to act to make things better. Everyone can see there are major needs in Brighton. Yet thousands of people in the town are unemployed. Are there sufficient houses that 1,000 Brighton building workers should be out of work? Are the sick attended to so well that 49 nurses should remain on the unemployed register? Don’t we need out-of-work teachers in overcrowded classrooms? If we know this work is needed, and people now on the dole want to do it, how can we accept that it is a waste of money?

 

One problem is that the organisations of working people have been forced into being defensive. They want to save jobs, they want to save services. This is good. But when things are being so devastated, their response feels hopeless to many people. It is not enough. There needs to be an alternative vision that stands up to the uncertainties and losses caused to people living through the new industrial revolution.

 

“You just have to speak your mind clearly at every possible public opportunity. And don’t worry who votes for you or doesn’t vote for you. Not to hide under any umbrellas of party politics. There’s an awful lot of intelligent people who’ve been in the Labour Party for a long time who’ve kept quiet because they didn’t want to rock the boat. The young fellow who fought Shirley Williams at Crosby just spoke his mind continually. He lost his deposit, but it really didn’t matter. An awful lot more people were influenced by the possibility of speaking your mind clearly, not compromising an idea.”

Unemployed Adult Education Student.

 

There is a sense in which people have developed a deep mistrust of any organised political, public body. There are many who see their wishes and opinions as private and uninformed. They feel shut out from places where decisions are taken. So politics are left by and large to the specialists. They are supposed to have the knowledge, to be informed. But there is a deep dissatisfaction with this division between public politicians and private living. The solution must be sought politically. There is a need to have a local state which supports us, puts our wishes into action. There is a distrust of people who speak for and not with other people.

 

Under monetarism, the loss of public services has forced people to retreat more and more into concern with their own survival. For the unemployed, there are long periods of waiting at the Social Security, time spent walking to save high fares, time spent searching for jobs. Time doesn’t count unless it can be measured on the money market. Old people’s homes closing means many women shelving their own plans in order to care for elderly people. Teachers are stretched to the limit to keep up standards with diminishing resources. The list is long. The point is that falling services are a drain on people’s time and energy. It is very difficult to think about acting together, when private, daily worries are so consuming. The division between public and private deepens. So does the need to break it down:

 

“There’s no idealism, and that’s got to be fought for. They are frightened of idealism. Like the sheer numbers on the anti-nuclear demonstrations. That is why demonstrations like that, or against new runways at airports, are good. People have to become actively political – get experience in groups of how to organise, how to deal with real problems. People have to be enabled to feel actual power and to gently practise forming effective opposition groups.”

Brighton Unemployed Worker

 

“I believe implicitly in co-operatives. People are fed up with political parties. The only way through is to mobilise the force of the people, to utilise and exploit the abilities of the people for their own benefit, instead of being exploited for profit.”

Whitehawk Resident

 

It’s easy to see why some people have despaired of things getting better and turned to the only seemingly new solution around: the SDP. But this is no answer at all. The SDP was started by people who left the Labour Party at a time when many within it were trying to think of new ways of tackling the grave problems monetarist policies have produced. The SDP approach is the old, worn-out, ‘we’ll-act-on-your­-behalf’ way of doing things which caused so many people to feel disillusioned in the first place.

 

The answer is not new political parties or more politicians, doing things for people. What is beginning to happen is that people are showing they want to reshape things for themselves. That they can. Councils should be servants, enablers, ‘animateurs’, not over-your­head, we-know-best decision makers. Women are challenging the idea that there are lives appropriate for women and lives appropriate for men. Adult Education students have actively fought against cuts, against the idea that schools and education are really the province of the young. Retired people do not see their useful lives as finished, as though they only counted when they had a job. Equally they can see the human waste of many younger people denied a job, when our society puts such a value on earning one’s keep. Thousands of nurses and health workers, not normally ‘political’, fought for months in 1982 to save an indispensable service and gain recognition for what they do. Women at Greenham Common, Brighton and elsewhere give up their ‘private’ lives to make the point that the supposedly precious and scarce commodity, money, is being wasted on weapons which can only destroy all our futures, rather than on services or useful products which could secure them.

 

Busworkers in Brighton and in other parts of the country have used industrial action to make detailed, positive plans for a better service – run by crews and passengers who know the needs of travellers, not by bureaucrats who don’t use buses.

 

These are real actions, real resistance to the passive role monetarism tries to force on us. No one can deny that there have been setbacks. To pretend otherwise is self-deceiving. This book alone will not make history. But what it can do is to show where history stands at the moment.

 

People in QueenSpark have always tried to show that real alternatives are best stated through our own actions and in struggles. We did this with the Royal Spa; in the many battles of the Save Our Schools campaign; over the Marina; at Black Rock, at Prior House and the Hanover Centre; and in the latest fight to keep the Nursery Schools. QueenSpark does not claim to have run these campaigns. Nor was any one victory ever complete. Many battles remain to be won.

 

What we can offer in this book, are some notes and pointers towards more ways of taking part in the local state and re-forming it. The force to multiply them and turn them into something more will come from people acting, thinking, struggling, producing, rebuilding. It will come from the belief that things can be changed. We have collected our suggestions under the headings of Work; Plans; New Kinds of Unions; and Public Meeting Places.

 

1. Work

 

– Work should be guaranteed. All who work for the public sector should have no need to fear for their jobs. Wages in this sector should be linked into the national movement of wages, with no fear of falling behind like the health workers.

 

– It is a collective responsibility to make sure that there are jobs. So jobs need protecting. They also need transforming. The guarantee should be for a job, not always a particular job.

 

– Some jobs are useless to others, even oppressive. This applies particularly to the more highly paid, administrative, advisory, over-looking jobs. Career jobs always seem safer than manual workers’ jobs; advisers’ jobs safer than teachers’ jobs; administrators’ jobs safer than social workers’ jobs. So it may be more useful to change some jobs and even to turn one highly paid job into two.

 

– This could be decided by the people using and affected by a service. There could be local commissions made up of groups of users, workers, clients, pupils, neighbourhoods. Some of the present criticism of ‘bureaucracy’ by Mrs Thatcher is right. But she wants to abolish jobs to save money for private enterprise, not to make real services for communities.

 

– If there is guaranteed work for people in the public sector, council workers might have to be willing to change jobs to increase output and improve quality, working in accordance with local commissions and plans for particular services. The commissions would not be bodies like consultative councils we have now, but groups set up to put their knowledge and experience of needs to constructive use.

 

– There should be more co-operation within the local state. Many of the public services could be improved if the workers were given more control and autonomy. Bus workers could clearly run the bus service better than their current managers, as could workers in refuse collection, housing maintenance or schools. In each case it would be important to involve the users of the service. It is also important that groups of workers do not set up private co-operatives sub-contracted to the state, since it would be easy for them to become isolated and forced to accept lower wages and conditions than public sector workers.

 

“You could have a bus company locally made up, 1/3 local TGWU branch, 1/3 people elected locally from Tenants’ Associations, 1/3 from Trades Council. All interests are safeguarded and you have the expertise and reality of people who use the services coming through.

You could say the industry should be run by the busmen. If you really want an efficient bus service, if that was a priority, you would have to replace the convenience of the private vehicle. You’d have to have regular buses running at short intervals, either pre-paid or with a conductor …

 

Summary:

 

1/3 – 1/3 – 1/3 company membership

 

Conductors – no OPO lone-person-operated)

 

Get to know routes properly

 

Decrease in shift work

 

Proper wage

 

Cheaper fares or a different way of financing.

 

Also, a non-profit transport system. You don’t need to make a profit in money terms. In my view, buses are made to carry people. Buses are not made to make a profit, and if a bus is taking a person from home to work, where he’s producing, then it’s showing a profit.”

A Local Busman

 

– If we had a freer hand and a more direct interest in our places of work, most of us could begin to think about improving them. What else could be made of refuse collection, schools, transport? Elsewhere, useful manufacture has come out of waste products. Centres useful to all ages have developed out of schools. Under-used canteens could be extended to elderly people; school facilities could be developed for teaching, learning, skills-sharing; small workshops could meet the need for life-long education, social gatherings and enjoyment by using spare equipment, class room and assembly hall time.

 

“The co-operative idea is based on things that have happened in the past. When I was a kid in these estates, many people used to make their own living. In the garden shed, making shoes, going round with grocery wagons, selling firewood, sweeping chimneys. That was their entire living. The basis for cooperative work is already there, if these people work together.”

Whitehawk Resident

 

– Where factories are closing, workers with the support of a progressive Council could take them over as they have done in London, in the West Midlands and in Lancashire. In Brighton they could draw on the resources and advice of the Polytechnic, the Technical College and the University to develop new products which suit their skills and machinery and which meet real needs.

 

– The third industrial revolution of the late 20th century with new technology in manufacturing and communication is destroying the working class more speedily than the first industrial revolution of the 18th and 19th century which created it. And now, no less than then, the power of organising production and hence society generally is seen to lie legitimately with the owners and managers of capital. They are the people whose interests lie in maximising profit and minimising the power of others who would resist these changes or use them for socially productive and valuable enterprise. And the government acts an ally of capital, introducing legislation to curb unions, drive the young unemployed into cheap labour, keep women at home. The government mouths the slogans of freedom, training and the family – but no one should be fooled.

 

– Enterprise needs to be for those who put in their work, rather than to make profit for the owners of capital. If enterprise is to be co-operative, it must be careful of what it makes, as well as who for. It must be careful of the environment, of health, and it will need financial and organisational support. Some of that can come from the local state.

 

– At present, the state works in very hierarchical ways. These are so rigid that even private firms do not adopt them. Enterprise cannot flourish until this is changed. People cannot feel able to act when the state makes them feel subordinate: schools which refuse a PTA; Social Security offices where unemployed people are made to feel they’re on the make; tax offices which borrow money from the PAYE payer for months before paying it back. Democratic control of offices and public services are as important as co-operative control at work.

 

2. Plans

 

– Plans are for everyone. They are too important to be left to professional planners. Popular plans would be more than demands for ‘them’ to do things for ‘us’, or party political programmes. The vote is no longer enough to put into practice our capability to work together.

 

– To turn this around we need adequate forums for expression and representation. One way would be a ‘second chamber’ now, at local government level made up of delegates from productive units, local enterprises, consumers, including consumers of local services. This would be an economic chamber, working alongside local government structures.

 

– Local people should have a say in plans affecting their lives.

 

“Housing in Whitehawk should be run by Whitehawk. People want an environment we can upgrade for ourselves. If you said, right, it is your estate, your environment, we have got total control, the place would be unrecognisable. I’m having ideas put to me all the time. Brilliant ideas and although these people are treated with disrespect by the Council, they are in many ways far more astute. Secondly, if you have housing managers, they should be elected, and officers should be elected.”

East Brighton Residents’ Association Member

 

– Popular planning is more than consultation exercises like the ones carried out by East Sussex Education Authority in 1982, which gave parents the chance to choose between four kinds of cuts (‘reorganisation’). These were overwhelmingly rejected. Alternative plans were put forward. One of the original proposals was then put into action. Consultation means finding ways of listening to people and then active forms for aiding into existence what they want.

 

– Plans could take the form of a Commission for Brighton of citizens and users, to re-examine services and produce an economic programme. A full plan for an alternative Marina was made by QueenSpark and the Trades Council during the Enquiry of 1974.

 

– Similar projects for schools, social services and health care could be carried out. Planning could change the way the service was used.

 

“Preventive work is the thing that’s going. And that was certainly the thing there was a big push towards when I first started working here as a Social Worker in 1974.”

Local Social Worker

 

– It is in the planning process, not just in results that real changes are made. Means are part of ends. Until this insight is realised in practice, plans will be just as oppressive to the people who are planned for, as ‘market forces’ are to those who become their victims.

 

3. Acting Together: New Kinds of Unions

 

“If you’ve got people working together for a common cause, you’ve got socialism. Quite a lot of people vote Tory, but they’re still working for the people with other people.”

Whitehawk Resident

 

– The power to act together is the greatest strength we have got. So far it has been developed more at work in Trade Unions than in the rest of our lives. Area Unions could be a way people could act together where we live.

 

– The people who worked on this book, united with many others in East Brighton over the last 10 years, have acted on many issues. The campaigns have mainly been about money and its allocation, for needs against profit. We could do more than this. There are opportunities for united action we have not begun to explore. For example all of us, directly or indirectly, pay money to the local and national state. Without this money – rates, bills, taxes – the State could not go on. We are all involved. This function as suppliers of revenue could be made into a basis for action.

 

– Could we not, then, agree to pay our rates, taxes, bills etc., publicly together instead of as a series of private hidden transactions. This would show the social nature of what rates are for.

 

– We should express our opinions when we make our transactions with the local state. We should be more particular about where money is spent.

 

“The rates has to be a local payment, and the people who pay for it have to have some way of saying, we’ll pay for these services but we really don’t want to contribute to any of these proposals.”

 

“I like the idea of local funding for local things, and the possibility of local control. I like libraries and street lights and buses and things like that and I quite like to pay for them. I go out of my way to avoid paying national taxes. I’m more comfortable with rates. I know Brighton couldn’t save up to buy a Trident missile if it wanted to and I think I could interfere in its processes if it really decided it wanted to. They’re more vulnerable. You can actually bump into them in a pub and tell them that you didn’t like something. But we’re pretty ineffective at doing it.”

Brighton Resident

 

– We could begin to make the payments into our own Union, before they are made. Any gain would then belong to its members. Some banks offer to do all a person’s budget over the year. Why should not an ‘Area Union’ do the same? It would then have funds at its disposal for its own chosen uses. In this way we could generate capital for co-operative enterprises.

 

4. Public Meeting Places

 

– We need public places, particularly to meet the needs of isolated, elderly and young people. The people of Brighton do not need the Conference Centre. It should be sold.

 

– In its place there might be: more swimming pools, libraries and centres, locally based. At present, resources are centralised in places where few people live, expensive bus-rides away. There could be travelling exhibitions, workshops, theatre, films which would come to where people are.

 

– There should be ways of regenerating local shops, with fair prices. Their loss has made shopping more difficult for the immobile. Alternative supermarkets could be linked by modern tele­communications to local outlets, which in turn could also provide other services.

 

– Every group of streets could have its own open house. Some could be for young people, to run their own centre, make and record their own music, learn skills, art, theatre and dance. They could produce things in workshops, darkrooms and kitchens. Others would be for all ages, with much the same resources, and including communal washing machines, television rooms, quiet rooms and workshops with good tools, which could be lent out. The centres could be providers of services like baby sitting, help with shopping, support for elderly and disabled people, education classes, films and theatre. There could be resident people to help run them. They would be places where people living near each other, yet now alone, could find ways of working, learning and spending their free association with each other.

 

These are just a few notes. We would Iike readers to contribute theirs. Anyone who has joined in local campaigns, or read the many QueenSpark books which give voice to the lives of our neighbours, knows that there will be differences of belief and conflicts of interest. Unanimity is never total. But the positive side of disagreement is the expression of difference, the sense that there is place to act, and different roles to play. From these actions there are encouraging lessons to learn. Our sense that power lies with us, not with certain ‘representatives’ remains. We still expect councillors and MPs to play their allotted part, but we are not so foolish as to think their analysis of the situation is better than ours. And we would like to begin to create alternatives to the present state of things.

 

Appendix I

 

Some Economic Terms Explained

 

“People like myself who have not real ly had a lot of education in the sense of things like economics, have rather held these things in awe … We’re beginning to grasp, more and more, that intellectual matters do represent something, not just black words on a white page.”

Local Busman

 

Absolute terms – see ‘real terms’.

 

Assets – for an individual assets are their possessions e.g. TV, car or bicycle. For a Local Authority assets .are things like schools and hospital buildings. Normally a distinction is made between ‘fixed’ and ‘current’ assets depending upon how quickly they can be exchanged for money. Current assets are those which can quickly be converted into money.

 

Banks – these work by lending to individuals, Government or Local Authorities, money which they have borrowed from other people. They make a profit by charging a higher interest rate for the money they lend compared to the interest rate that they pay, or may not pay, to the people from whom they borrow. What is often difficult for people to understand is that banks can actually create money. They can do this, within limits, by lending more money than they actually borrow.

 

Cash flow – the flow of money over time.

 

Capital expenditure – expenditure on commodities which will have a useful life of more than a year: e.g. expenditure on building a new hospital or school which will provide services for many years.

 

Circulation of value – capitalist societies operate by a process of continually circulating commodities in a vast un-ending circle. As commodities are representatives of ‘value’ , or the labour society puts into producing them, we can talk of the circulation of value. During this process the form the commodities take, and therefore value, is constantly changing. The pivot of the system is people exchanging their labour power for money. A capitalist starts with money which they then use to employ a worker who in production produces a commodity. This is exchanged in the market for money which returns to the original owner who uses this money to re-start the process all over again. During this process the commodities involved are firstly money, then labour power, and lastly some specific commodity with a certain ‘use value’ which was sold in the market for money. The amount it is sold for is called its ‘exchange value’ (see below).

 

Commodity – this is any article or service produced for sale in the market.

 

Current expenditure – this is expenditure on commodities which are consumed within a year: e.g. the wages of a nurse or school teacher pays for services provided and consumed immediately.

 

Current prices – or market prices, are the actual prices at which commodities are sold. During periods of inflation the price of commodities rise without there being any change in the real value of these commodities. So that we can compare the real value of commodities produced in different years the Government gives out statistics expressed as ‘constant prices’. These are ‘current prices’ adjusted to remove the effects of inflation which allow us to compare the real value of commodities produced in different years.

 

Debt servicing charges – is the interest which Government and Local Authorities pay on money they have borrowed in the past.

 

Deficit financing – this is where Government or Local Authorities cover any shortfall in their income compared to their expenditure, a deficit, by borrowing money.

 

Diseconomies – or, in full, diseconomies of scale, is the opposite to economies of scale. On some occasions producing commodities on a large scale results in higher rather than lower unit costs. Local Authorities were re-organised in 1973 because it was thought that centralising Local Authority services into larger operating units would improve efficiency and therefore reduce costs. In practice there were considerable diseconomies meaning that the cost of providing some services actually increased. Plus of course the decision makers became more and more remote from the communities they served.

 

Economies of scale – an economic term meaning that it is often cheaper to produce commodities in large rather than small quantities: e.g. it is cheaper to produce a car in a factory producing 100,000 a year than in one producing only 1,000.

 

Exchange Rate – this measures the value of the pound in terms of other currencies, e.g. an exchange rate of 1.60 dollars to the £ means that £1 is worth 1.60 dollars. An increase in the exchange rate, e.g. to 2.4 dollars to the £ means that our exports become more expensive because people in the United States now need to spend more dollars to buy the same value of commodities expressed in terms of pounds. The exchange rate is often quoted in terms of the dollar because many commodities, like oil, are traded internationally with their prices fixed in dollars. However it can also be measured in other ways. One is the trade weighted index which measures the value of the pound in terms of a number of other currencies depending upon how much of our overseas trade is done in each currency.

 

Exchange value – the value of a commodity in terms of how much of another commodity, usually money, it can be exchanged for.

 

Fixed interest – means that the interest rate charged on a loan will not vary during the period of the loan.

 

GDP – Gross Domestic Product is a measure of the ‘value’, in money, of the total amount produced in a country over a period of a year. It can be measured either in terms of ‘market prices’: i.e. the actual prices at which commodities are sold, or in terms of ‘factor cost’. The latter takes into account that the price of a commodity often includes an element of tax like VAT, which is a payment to the Government rather than to the producer of the commodity. Factor cost is therefore ‘market prices’ minus this tax element.

 

GNP – Gross National Product. This means the same as GDP but includes income earned by UK citizens in overseas countries and excludes profits extracted from the UK by foreign companies operating here.

 

Inflation – this is a general rise in the prices of commodities or a fall in the value of money. When prices rise a certain amount of money will now exchange against a smaller quantity of commodities. We can say that the real value of money has fallen because fewer commodities can be exchanged for it.

 

Interest rate – this is the price that has to be paid for borrowing money expressed as a percentage. If the interest rate is 10% on a loan of £100 over a period of one year, then the borrower has to pay back £10 in addition to the £100 borrowed when the money is repaid.

 

IMF – International Monetary Fund, is an international bank controlled by Western governments which was set up at the end of World War II to provide loans to governments facing financial difficulties.

 

Labour productivity – see ‘productivity’.

 

Loan capital – this is money which is lent by one individual, bank or government to another for a period of time.

 

Market sector – that part of the economy where commodities are produced specifically for their ‘exchange value’ and hence for sale in the market.

 

Market value – the ‘exchange value’ of a commodity determined by the amount of money against which it can be exchanged in the market.

 

Money market – these are financial institutions, like banks, which work by borrowing and lending money. The Government and Local Authorities use these facilities when they wish to borrow money. See ‘banks’.

 

Money prices – see ‘current prices’.

 

Money supply – this is a measure of the total amount of money in circulation in a country. As money can take many forms (e.g. paper money, peoples’ balances in bank or building society accounts), it is impossible to give a single definition and therefore quite a few are used. In the UK the important ones are M1, which includes paper money and peoples’ current accounts with banks, and M3 which is Ml plus peoples’ deposit accounts, e.g. those accounts on which banks pay interest. See ‘banks’.

 

National debt – this is the total amount of government debt outstanding.

 

Non-market sector – that sector of the economy where commodities are produced for their ‘use value’ rather than their ‘exchange value’. Such commodities are not exchanged for money in the market place but are supplied ‘free’ to those who require them, e.g. State schools, visits to the doctor. Such commodities are of course paid for through taxation.

 

Per capita expenditure – this is simply expenditure per person.

 

Physical terms – the ‘value’ of a house can be expressed in money terms, its ‘exchange value’. Alternatively it can be expressed in ‘physical terms’ by referring to the number of bricks, or the time required to build it.

 

Private sector – the non-government part of the economy. In this sector commodities are usually produced for their ‘exchange value’, rather than just their ‘use value’, with the aim of making a profit.

 

Productive sector – term used by some economists about that part of the economy which produces commodities which will be sold for profit, e.g. the commodities are produced for their ‘exchange value’.

 

Productivity – this term means that as societies develop, so less labour is required to produce certain commodities. Productivity is a measure of the actual amount of labour required to produce a commodity. An increase in productivity occurs when less labour is required to produce a commodity. As the value of a commodity is determined by the amount of labour society allocates to the production of a commodity, an increase in productivity also leads to a fall in the value of a commodity. This is often shown by a fall in its market price or its exchange value. Note that the term value is used in a special way in this book – see definition of ‘value’.

 

PSBR – Public Sector Borrowing Requirement. This is the total amount of money the UK Government has to borrow during the year to finance any excess of expenditure over income.

 

Public sector – the sector of the economy directly controlled by Government. This includes both central government, Local Authorities and the nationalised industries like the National Coal Board.

 

Rateable value – this is the value put on a house, shop or factory to work out the amount of local tax, or rates, which the owner of the property will have to pay each year to the Local Authority.

 

Rate of growth – this measures the increase in a country’s GDP (or GNP) from one year to the next, expressed as a percentage of the preceding year’s total.

 

Real terms or real value – during periods of inflation the prices of commodities rise without there being any change in the ‘value’ of these commodities. Therefore although their price in money terms has risen we can say that there has been no change in real terms or in their real ‘value’.

 

SET – Selective Employment Tax. This was a tax introduced in 1966 aimed at making labour more expensive to employ in the services sector of the economy, and thereby increasing the available supply of labour to the manufacturing sector. At the time official unemployment was less than 400,000, a tenth of today’s figure, and up until then manufacturing employment had been growing. In the years that followed manufacturing employment fell by nearly 40%. SET was abolished in 1973 when VAT was introduced.

 

Social wage – the commodities we as individuals consume are in some cases provided for us directly by the State. The ‘social wage’ is a measure of the ‘value’ of these State-provided commodities. They are, of course, paid for out of taxation.

 

Sterling M3 – this is one of a number of definitions of the money supply. It measures not only the amount of cash in the economy but also the money people have in their bank deposit and current accounts. Unlike M3 proper it excludes bank deposits in currencies other than sterling e.g. dollars.

 

Subsidies – often Government gives money to companies or Councils which allows them to sell commodities at less than it cost to produce them. This is called a subsidy.

 

Treasury Bill – this is a piece of paper representing a loan made to the Government. Each week the Government may have to finance an excess in its expenditure over its income and to do so it borrows money in the money markets. One way it does this is to sell a Treasury Bill for say £990 which it then buys back 91 days later for £1,000. The difference of £10 represents the interest it pays to the person or company who lent the Government £990 for this period of time.

 

Unproductive labour – this is a term used by some economists to mean that the commodities produced by some people do not have any ‘exchange value’ because they are not produced to be sold for a profit.

 

Use value – a measure of the actual usefulness of a commodity in the sense of the service it performs.

 

Value – this term has a special meaning in the way it is used in this book. It is the amount of society’s labour used in producing a certain commodity. It emphasises that commodities are produced not by isolated individuals but by people working together in a society. It stresses the social nature of production. In doing so it is distinguished from the terms exchange value (which measures the worth of one commodity in terms of another) and use value (a measure of the usefulness of a commodity for the particular individual consuming it) each of which relates to individual commodities irrespective of the social conditions under which they are produced.

 

VAT – Value Added Tax. This is the tax which the Government levies on commodities sold in the market. Currently it is 15%, having been increased by the present Government as part of it’s plan of shifting the burden of tax away from what people earn on to what they spend. It is called an ‘indirect tax’, as distinct from income tax which is levied directly on peoples’ income and which is therefore termed a ‘direct tax’.

 

Appendix II

 

Finding the Facts

 

THE facts in this book relate to local government spending in Brighton and East Sussex. Much of what we have found out for our situation applies to other local councils’ spending patterns too.

 

Brighton and East Sussex each produce an Annual Report and Financial Statement for the year ending 31 March. Brighton Council also publishes the Brighton Finances Handbook and the Revenue Budget. All these documents are available on request from the respective Town Halls and reference copies are kept in the main libraries.

 

In theory the purpose of these documents is to inform ratepayers, electors and councillors about local government income and expenditure and to enable them to make comparisons with the activities of other local authorities. In practice this information is very hard to uncover. Although a large number of facts and figures about local government expenditure in Brighton can be gleaned from these sources, it can take a lot of painstaking research to obtain reliable figures on any specific item of Council income or expenditure. Comparisons between different years present correspondingly larger problems, particularly in the case of East Sussex where up until three years ago no easily digestible annual report was produced. Frequently also, categories of expenditure alter – certain items suddenly appearing under a quite different heading – and information disclosed in one year is not necessarily disclosed the next. Finally very precise adjustments have to be made to all the figures to take into account the fluctuating rate of inflation. Only when comparisons are made between prices in real terms (that is to say after the effects of inflation have been removed) can we arrive at meaningful conclusions on the changing pattern of Council expenditure and priorities.

 

Despite these difficulties and with care, time and many helpers, the puzzles can be solved. Access to the kind of information we have made use of in this book is a legal right. The Local Government, Planning and Land Act of 1980 requires local authorities to make all such facts available to members of the public. One of the purposes of this book is to demand the publication of more accessible information, while showing that even the mystery deliberately shrouding the presently available data can be cleared to reveal a stark and disturbing picture.