Labour MPs have expressed their fury after Tory rebels dropped their objections to council cuts because of a new £300m government fund to ease funding difficulties in mostly wealthy Conservative-run areas.
Greg Clark, the communities secretary, insisted the new cash was not a “political bung” to stop up to 30 Tories revolting against the local government settlement.
However, several Tory MPs openly acknowledged they were persuaded to back the government only after the new “transitional relief” was announced, of which about 83% will go to Conservative councils.
Graham Stuart, Tory MP for Beverley and Holderness, expressed delight that the lobbying campaign for more money for rural areas had paid off.
“I stood here a month ago and said ‘Now is the time for the rural voice to be heard’. Well a month on I’m pleased to say that the rural voice has spoken and has been heeded, at least to an extent,” he said.
Steve Double, Tory MP for St Austell and Newquay, also said he was going to rebel against the Government before the transitional cash was announced.
“I’m happy to place on record that as of Monday morning I would have been one of the members on this side of the House who this evening was prepared to walk through the ‘no’ lobby and vote against the government,” he said.
Double then welcomed the fact that the government had “listened” on the issue and come forward with proposals to address his concerns.
However, Labour MPs were furious that only 5% of the new relief will be going to areas run by Labour. The rest goes to councils with no overall control, coalition or run by other parties.
Steve Reed, the shadow local government minister, said: “Whatever happened to the one nation Tories, what about the northern powerhouse, if the word gerrymander didn’t already exist we’d have to invent it to describe a fix like this.”
He said the way the money was being distributed was “desperately unfair” and a “political bung”.
Jim McMahon, Labour MP for Oldham West and Royton, said ministers were treating councils as a mere “plaything” and giving a “friends and family discount” to their own Tory areas.
“If you want to come and live in Oldham, if that helps our financial situation then we will do that.”
Another Labour MP, Jenny Chapman, refused to give way to Clark, saying he was “ripping the heart out” of her Darlington constituency.
“It’s extraordinary what this government has managed to do in pitting town against village, north against the south, the metropolitan areas against the shires – it is disgraceful,” she said. “I don’t resent members opposite being good champions for their areas, winning some extra funding for their councils.
“That’s one of the things we’re here to do. But I hope they enjoy that extra money they get. I hope they win their shire council seats that it was clearly designed to provide victory for, I hope they enjoy that.
Clark insisted the funding settlement was fair across the country and warned that councils would have to get used to a new world of scarcer cash from central government.
“We’re moving from one world to another, from a world in which the government grant accounted for nearly 80% of local government expenditure in 2010. We’re moving to a world during this period [in which] by 2020 only 5% of local government spending power will come from the revenue support grant,” he said.
“And in the same period, with the implementation of 100% business rates retention, the proportion of council spending power that comes from local sources, council tax and business rates, will grow.”
MPs voted in favour of the local government settlement by 315 votes to 209.