I also want to start my contribution to this debate in the proper place by thanking councils, councillors and the staff of local authorities for the exceptional work that they've done over past few years. They have proved, if it needed to be proved—I don't think it does—the importance of that level of government, perhaps closest to the coal face. They stepped up, of course, and created the bespoke solutions, reflecting the needs of their local communities in a way that a national government couldn't have done. I think it's important that we recognise that and bear that in mind when it comes to discussing the shape of local government for years to come.

The increase of 9.4 per cent in the settlement is something to be welcomed. It is certainly a bigger increase than many in local government had expected, and we could say that it's generous. Certainly, at first sight, it is generous. But when you then realise that the reality is that many of the elements funded outwith the RSG in the past are now part of the settlement, and if you add that backdrop of increasing costs, inflation being significantly higher than some of us would have anticipated, and certainly higher than any of us would want, and the commitment to salary increases, which is of course the right thing to do, then all of a sudden the settlement doesn't look quite as generous as it would have done otherwise.

Year 1 tells one story, but years 2 and 3 tell a very different story, don't they? Because the settlement is flat for years 2 and 3, to all intents and purpose. If we do recognise that there are going to be challenging elements in the year to come, well, that's going to be intensified significantly in the years beyond that. So, I do think we need a reality check, although of course we do welcome the increase. It is greatly needed, because there will still be huge pressures on that funding, and the need to increase council tax will remain in order to respond to those pressures.

Although we're coming out of one crisis, the COVID crisis, we are entirely aware of the new crises facing us now in terms of the cost of living and the situation in Ukraine, and so on, and that's going to make a difficult situation more difficult. Food costs are increasing, fuel costs are increasing, and there are implications for local authorities, of course—in terms of schools, education services, care and all sorts of other services. The costs are increasing at exactly the same time as the demand for many of the services provided by local authorities is also increasing. So, the question is, essentially: how much scope is there to step into the breach next year if things deteriorate more than we are anticipating? To what extent does the Government have plans or funding in reserve in order to step in if need be?

I also want to echo the point made on the funding formula and to repeat what was said a few weeks ago in that debate. Whilst it's right that the Government looks at how council funding is collected through council tax, I think it's also appropriate that we look at how that is distributed. And not just look at the formula in isolation; we need to look at the bigger picture of the funding of local authorities. Because I hear in feedback from local authorities that many of the new responsibilities that have been handed to local authorities that are supposed to be cost neutral in reality do bring additional costs in many different ways. I don't think there's been an opportunity to look at the bigger picture when it comes to that funding scenario. The formula is dated. We would agree with that, and also agree that, whatever the formula is, there will be winners and losers. Of course that's the case. But I do feel that an independent review would be very timely indeed.