Wednesday, 21 June 2017

An uncertain future for local government finance

All sorts of promises were made before the election on doing something about how local government is paid for:
Futures Forum: Business rates: promising a 'fundamental reform of the system'

Because it's all in a bit of a mess:
Futures Forum: "Local authorities are going to become increasingly dependent on business rates and yet by so doing they will potentially drive up the costs of healthcare in their localities."

And promises were made:
What do the General Election manifestos mean for local government - LocalGov.co.uk - Your authority on UK local government
Tories pledge radical overhaul of social care and pensions in general election manifesto | Public Finance
General Election: Manifesto pledges for local government finance | Room 151

Local government leaders and bodies are not happy:

Heather JamesonDan Peters 21 June 2017

Queen's speech fails to mention reforms to local government finance

The Local Government Finance Bill 

has been dropped from the legislative programme, 

leaving plans for business rates retention in limbo.

Despite the lack of a Local Government Finance Bill, a Department for Communities and Local Government spokeswoman said: 'The Government is committed to delivering the manifesto pledge to help local authorities control more of the money they raise and will work closely with local government to agree the best way to achieve this.'
... As expected, there was no social care bill though the Government committed to a consultation of the future of care.
Conservative chairman of the Local Government Association, Lord Porter, said: 'It is hugely concerning that the Government has not reintroduced the Local Government Finance Bill in the Queen’s Speech. Local government collectively must keep every penny it raises locally in taxation to spend on local services to help secure the long-term financial sustainability of councils and ease the pressure facing the public services our communities rely on. Plans to develop a fairer system of distributing funding to councils must also continue.'
Other measures include:
  • The announcement of a full public inquiry into the Grenfell Tower tragedy
  • Legislation to protect victims of domestic violence and abuse
  • A reform of mental health legislation, which will be ‘prioritised’ in the NHS
  • Plans to ban unfair tenant fees
  • Ensure more homes are built
  • Legislation on personal data protection
  • Legislation to modernise the courts system
Cllr Paul Carter, chairman of the County Councils Network and leader of Kent County Council, said: 'With the omission of the Local Government Finance Bill from the Queens Speech it appears that 100% Business Rate Retention is off the agenda in its existing form. Therefore, it is essential that Government works with counties to identify other ways in which local government can retain more resources locally, without the need for legislation. I would also encourage Government to continue their Fair Funding review and not allow timescales to slip, taking into account existing and growing pressures, such as those facing children’s social care.'
Chief executive of the Chartered Institute of Public Finance and Accountancy, Rob Whiteman, told The MJ he was ‘disappointed but not surprised’ that the legislation had been dropped.

Queens speech fails to mention reforms to local government finance - LocalGov.co.uk - Your authority on UK local government

Public service chiefs slam lack of policy action in Queen’s Speech

21 Jun 17
Public service leaders have expressed dismay over the Queen’s Speech failure to address public sector issues including pay, social care and local government funding.

Today’s address laid out prime minster Theresa May’s legislative agenda for the next parliament but is far removed from the Conservative manifesto pledges she hoped to introduce...
There was no mention of May’s proposal to change the way social care was funded, pledges on grammar schools, retention of businesses rates for local councils or removal of the triple lock on state pensions.
CIPFA chief executive Rob Whiteman said “pressing issues” were missing from the speech, highlighting social care, devolution and the NHS. He added: “Without urgent action, both health and social care budgets will be stretched to breaking point. More realistic medium and long term financial planning, and investment in prevention, is needed to stabilise the financial position of the NHS.”
This view was shared by Jo Miller, chief executive of the Society of Local Authority Chief Executives, who said: “I am disappointed that key legislation – absolutely fundamental to ensuring the future sustainability of local government – has now been dropped. Local government urgently needs clarity around our future funding – at present we simply face a cliff edge from 2020. This must urgently be resolved.”
Claire Kober, chair of London Councils, also expressed disappointment at the lack of detail on council funding, adding she was “deeply concerned” by the absence of discussion regarding 100% business rates retention. 
Garry Graham, deputy general secretary of the civil service Prospect union, said this “was a missed opportunity” for the government to listen to the public over the election result. “This was an ideal time for ministers to acknowledge that the 1% pay cap is no longer working and that public servants deserve a pay rise,” he said, adding that hard-pressed public servants would struggle to deliver a good Brexit because of bad pay and increasing world loads.
Alison Michalska, president of the Association of Directors of Children’s Services, welcomed the measures on mental health and domestic abuse but criticised the government for not tackling funding concerns for schools and local authorities. She said: “The government must recognise that there is not enough money in the education system rather than focusing on the way in which existing funding is distributed to schools.” She said it was “a matter of urgency” that great clarity was provided on local government funding as children’s services face funding shortages.
Dave Prentis, Unison general secretary, claimed the government was ignoring the nation’s concerns while “ministers are living in a parallel universe”. He said: “People have had enough of austerity, and want proper investment in schools, hospitals, police forces and local services. Yet there was none of this in the Queen’s Speech. Nor was there anything about pay. Nurses, teaching assistants, council workers, police support staff and other public sector employees should be rewarded for their hard work with a long overdue wage rise.” 

Public service chiefs slam lack of policy action in Queen’s Speech | Public Finance

With comment from East Devon:
This is no time for council vanity projects | East Devon Watch

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