By Mark Smulian
30 March 2011
Complaints about the impact of cuts on public services should
be made to local councils, Chancellor George Osborne has told the Treasury select
committee.
He said this was the right place for decisions on service
cuts and closures, though he had sought to ensure the ‘burden’ was spread
nationally.
In an evidence session yesterday on last week's Budget, Conservative
MP Mark Garnier asked him: ‘Large sections of society feel they are not in this
together. I have had a group of angry police at my surgery and members of the
Women’s Institute protesting against library cuts. What have you done to spread
the pain as fairly as possible?’
The chancellor said the effects of cuts and tax changes were
‘pretty evenly spread across the income deciles’.
It would ‘have been extremely tempting for me to be a
control freak, but it's for local councillors to make those decisions [on
services]’.
Asked whether the Big Society simply meant using the
voluntary sector to fill gaps left by public spending cuts, he replied: ‘I
think the attempt to run the country from the centre was not a great success
and that councillors know what is best for their area.
‘There have been strikingly different results between councils
having to make quite similar cuts.’
Another Conservative MP, Jesse Norman, asked what would be
done to seek ‘flexibility and transparency’ in Private Finance Initiative deals that had proved poorvalue for the public sector.
Osborne said: ‘It is quite clear that a lot of contracts were
entered into without high regard on the public sector’s part for their value
for money, though the contractors have done pretty well out of them.’
He said the Queen’s Hospital project in Romford, Essex,
would be used as a test bed to see what renegotiation was possible, and if
successful would provide ‘a template’ to work from.
Committee chair Andrew Tyrie quizzed the chancellor on his decision
to resurrect the concept of enterprise zones to encourage urban regeneration.
These were last used in the 1980s and provide exemptions
from some tax and planning requirements for businesses that invest in these
areas.
Osborne admitted: ‘Opinion is very divided but evidence from
the 1980s is that if you go into these with local authority support and co-operation
your stand a greater chance of success.
‘The lesson of the 1980s is that you have to be in lock step
with the local authority, and now the local enterprise partnership.
‘I did not see how these zones would do harm and thought
they could do some good.’
