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More acrimony surrounds the distribution of government grant than any other aspect of local government finance. ...
More acrimony surrounds the distribution of government grant than any other aspect of local government finance.

Councils can happily unite to oppose capping or to call for a shift in the balance of funding, but because of vested interests a unified voice on grant distribution is impossible.

The government is aware of this. It knows its decision to disregard key data from the latest census will lead to nothing but an unholy row within local government between winners and losers.

In essence the government has decided, apart from population figures, to disregard 2001 census results and continue to use 1991 results when calculating grant distribution.

Clearly, there is a balance to be struck between stability and the use of the most up to date information available. Councils cannot plan effectively if there are huge, unpredictable swings in funding. However, the role of floors and ceilings is precisely to mitigate these swings.

The upshot of the government's move is that the most accurate information we have on the demographic profile of this country is not being used for one of its main purposes - to determine the allocation of grant to individual councils.

That is unacceptable. No one would pay for their gas for 13 years on the basis of estimated bills. So why should£46bn of government grant be distributed the same way?

These latest revelations do nothing to restore the huge damage already done to public confidence in the census.

The notion that 60,000 people could somehow have 'disappeared' in the course of the count,

only to resurface after a two-year battle between the Office of National Statistics and a small number of councils (LGC, 15 July), is disconcerting, to say the least.

In what often appeared a personal spat between Westminster City Council and national statistician Len Cook, the ONS was forced into a humiliating climb down and admitted that some of their data was wrong (LGC, 15 July).

It now appears that on top of some of the figures being flawed, others that are accurate are to be ignored because incorporating them would affect distribution too radically.

If the government is really using figures so distant from reality, it is storing up trouble for the future.

As well as further undermining the census process, it is in serious danger of bringing the whole funding system for local services into disrepute.

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