Working-class communities won’t be made to pay!

Huw James, Aldershot and North Hampshire Socialist Party

In Surrey the local elections on 7 May will be to elect councillors for two new ‘unitary authorities’: East Surrey and West Surrey. The key challenge facing West Surrey is that it will start life with debts exceeding £4.5 billion. The debt was created in boroughs under the control of the Conservatives and Liberal Democrats and equates to around £7,000 per resident.

It is claimed that because of this debt, West Surrey will start life bankrupt. This is based on the fact that Woking Council, which accounts for most of the £4.5 billion, supposedly declared bankruptcy in 2023. But a local authority cannot go bankrupt as the financing for council services is implicitly underpinned by central government (only an act of parliament can dissolve a local authority).

Woking Council’s debt is owed almost entirely to central government, and the same goes for the rest of the £4.5 billion debt that West Surrey will inherit. The entire debt could be written off at the press of a button or stroke of a pen. In fact the government has already agreed to write off £500 million, which raises the question of why it doesn’t just write off the rest of it.

By refusing to write off the debt, central government is effectively demanding that West Surrey provides it with money. The sensible thing would be to use the consolidation as an opportunity to write off the debt and begin again with a clean slate.

The reason the government won’t do this is to force West Surrey to pursue an austerity agenda. As depressing as that seems, there is a positive to take from this story. Woking Council has demonstrated that it is possible for a local authority to go into debt, and there is nothing to stop a local authority going into debt to properly fund public services or build affordable housing.

As long as that debt is denominated in pound sterling – as almost all local authority spending is – the government can write if off at any time. The idea that local authorities can go bankrupt provides justification for policies designed to discipline the working class. The only thing preventing government from properly funding council services is a lack of political will. The three Socialist Party members standing as part of TUSC in West Surrey do have the political will! We are fighting for councils to use all powers at their disposal to fund the services we need, and send the bill to Starmer.