Local Government Finance Commission Findings and Recommendations Overview
Explore the Independent Commission on Local Government Finance's key findings and recommendations regarding the strengths and weaknesses of the local government finance system. Discover proposed reforms focusing on areas such as growth, housing, welfare provision, health and social care, and support for families. Gain insights into the vision for promoting self-reliance, innovation, transparency, and support for vulnerable populations in local governance.
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Presentation Transcript
Independent Commission on Local Government Finance Eamon Lally CIPFA North West Annual Conference 14 November 2014
The Commission Timetable from here: 30 Oct: interim report published Nov-Dec: Engagement on Interim findings Feb 2015: Final report Terms of Reference Identify the strengths and weaknesses of the local government finance system, Bring forward practical options for reform in the next Parliament and Develop and test those proposals against the key challenges facing the country growth, housing supply, effective welfare provision, affordable health and social care, and early support to families and children.
Context: The path of future revenue funding not including schools Total funding projected to fall to 43.4 billion by 2019/20 This includes 3.1 billion of Public Health funding which carries with it a new responsibility All figures are in cash terms In 2013/14, 38% of total funding is from council tax, 19% from retained business rates, and 28% from RSG 60 Public health funding not new money as it comes with a new burden 50 Additional Social Care funding 40 Change in reserves Investment income 30 Public Health allocation billion Other grants Formula Grant 20 RSG Retained Business Rates 10 Council tax The localisation of council tax support in April 2013 reduced the taxbase 0 - 10 Negative reserves figures when councils underspend and contribute to reserves Source: LGA's Future Funding Outlook 2014 - outturn data to 2012/13, budget data 2013/14. 2014/15 and 2015/16 based on settlement, 2016/17-2019/20 from LGA projections 4
The Commissions vision The local government finance system should: Promote self-reliance and self-sufficiency Encourage entrepreneurialism and innovation Promote local decision-making on service delivery Transparency Maintain support for the most vulnerable
What the Commission has said it agrees with Self-sufficiency Greater freedom over council tax, including bands, rate, and discounts 100 per cent retention of business rates Devolution of skills and welfare to work funding More integration of decision-making across local public services 6
Pace and Scope of Change? Variable speed reform? Self-sufficiency over all local public services? New incentives? A new approach to equalisation? Integrated services? Bold approaches to housing supply problems?
Equalisation Not all Councils can grow economically at the same pace Not all Councils will grow their populations at the same pace Councils will face different Levels of demand
Challenges and questions What is the appetite for radical change? Is there evidence that integrating health and social care services will create savings? What incentives are needed if any? What should the balance be between incentives and equalisation in the system as it moves towards self-sufficiency? How would it work the wiring diagram?
Independent Commission on Local government Finance enquiries@localfinancecommission.org Contact Eamon Lally: Tel: 07799768570
