It is very rare when local councillors defy the law and central government and risk being hit with heavy fines and chucked out of office. Yet this is just what 11 councillors in a small Derbyshire village did from early 1972 onwards, resulting in them being surcharged 50 years ago this month.
This was to lead to them being made bankrupt, with bailiffs being sent in to take possession of their assets. They were barred from ever standing again for a councillor’s post.
In many respects the situation at the time was similar to today, with poorer people being asked to pay for the economic crisis.
Under the 1972 Housing Finance Act (HFA), councils were instructed by Edward Heath’s government to increase tenant rents. Rebates for less well-off tenants were to be covered by the better-off ones and ratepayers who might themselves be struggling with their bills. Conversely, subsidies to owner-occupiers in the form of tax relief on mortgage interest repayments were generally higher than those to council tenants.
The Conservatives had been trounced in local elections in 1971-72, losing nearly 3,000 councillors and control of most major cities. Much of the country’s public housing stock – which was almost double the 18 per cent figure of all housing today – was under Labour control. Official Labour Party policy was to oppose the HFA, under which rent paid would make a profit for councils. The plan was to increase rents over four years to £5 a week, trebling the £1.60 charged in the Derbyshire village of Clay Cross.
For the HFA to work the government needed the assistance of Labour councils. Fearing being surcharged and barred from office, one by one they fell into line until Clay Cross Urban District Council (UDC), consisting of just 11 councillors, all Labour, remained alone in refusing to implement the rent rise.
Locally born John Dunn joined the Labour Party as a teenager in the late 1960s. He became a miner in 1971 and worked underground for 19 years. “I backed the council when it sought to relieve some of the deprivation and hardship,” he says. “Councillors were miners, cleaners and building workers.
“They’d introduced benefits such as pensioners’ free travel and built a swimming pool and community centres. When the education secretary Margaret Thatcher stopped free school milk, the UDC used a penny rate to continue to provide milk. Councillors created jobs by expanding its direct labour force. It paid a living wage.
“But the real issue was, as in many deprived areas, housing. A fifth was slums. By 1970, the council, which had to buy them from Clay Cross Company, had demolished over 500 houses that lacked hot running water or inside toilets. New land was purchased and housing built. The council, chaired by Dennis Skinner until he became an MP in 1970, used the general rate fund to subsidise the programme rather than government loans.”
New homes had gardens and public spaces. Council rents remained affordable and Clay Cross councillors had resolved to keep them so by defying the HFA. They refused to increase rents by £1.
This defiance continued a tradition started in 1921 by 30 councillors in Poplar, London, who were imprisoned for protesting at what they saw as an unfair rating system. In 1926, elected boards of guardians who administered poor relief in West Ham in London and Chester-le-Street were disqualified for paying more than they were entitled to.
On 18 January 1973 all 11 Clay Cross councillors were surcharged for an alleged deficit in the council’s housing revenue account and ordered to pay £635 each to cover the extra rents they had failed to collect. Councillor David Skinner, brother of Dennis, spoke for all, saying he would never pay a penny. A legal challenge to the decision was lost at the High Court in spring 1974.
“Surcharges bankrupted the councillors and they were removed from office and barred from ever standing again,” says Dunn, aged 22 back then, married with a three-year-old daughter. He stepped forward to stand as a candidate in 1974 when the last ever UDC elections took place before Clay Cross became part of the new North East Derbyshire district.
“Bailiffs removed councillors’ cars and they also took possessions away by entering people’s homes. By the time this happened there was a Labour government but it would not intervene to make sure the £7,000 owed was overlooked.
“We won ten of 11 seats on an 80 per cent turnout. The other was lost by two votes. We maintained the policy of asking tenants not to pay the proposed rent increase. The government had sent in the Housing Commissioner, who had to employ his own rent collectors.”
Dunn himself was then surcharged, not over the HFA but for breaking government pay restrictions by introducing a living wage for full-time housing wardens in sheltered accommodation.
“Councillors were barred from office for five years and ordered to pay a combined £2,202. This was covered through donations.”
Dunn was elected to Derbyshire County Council in 1993, supporting firefighters in a pay dispute as chair of the fire authority and opposing cuts in council services before quitting in 2005 in protest at Tony Blair’s decision to send British troops to Iraq.
Central government funding to local authorities was sharply reduced in the austerity policies of 2010 onwards, forcing councils to make big cuts in services. Liverpool has lost £0.5 billion since 2010, Newcastle £410 million, with a further £63 million cut between now and 2026. Manchester is set to lose £96 million up to 2026, with social care likely to bear the brunt. Dunn criticises central government for this but also wants councillors to refuse to implement the cuts.
“Fifty years on I believe Clay Cross councillors were right. It was a bad law aimed at struggling social housing tenants. Anyone in the labour movement must stand against a bad law. By resisting such laws, the lives of ordinary people have been improved.”
Will there be any resistance?
“Unlike previously, councillors today get paid. Many view this as a nice second income. Labour Party policy is to make cuts. Last year when six Liverpool Labour councillors decided not to vote against their own group’s budget cuts, they lost the Labour whip. At a time of great economic hardship for many they were right to not do the government’s dirty work.
“If many councils combined to take a stand the government would face a very difficult problem and don’t forget – at Clay Cross we did achieve some success as the rent increase did not get collected.”
Photo: Labour councillors from Clay Cross before their appeal in the High Court (Ronald Spencer/Shutterstock)
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