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No extra money in final funding settlement

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Councils have denounced the final local government settlement after communities secretary Sajid Javid confirmed the draft issued in December with what appears to be minimal changes.

Local Government Association chair Lord Porter (Con) said it was “hugely disappointing” the government “will not provide any new funding for councils in 2017-18”.

The final settlement, published last night, confirmed announcements made in the provisional settlement in December, including the revised council tax referendum limits of up to 4.99% for top tier councils as well as diverting £241m of new homes bonus funding to social care services. 

Lord Porter said: “Cuts to new homes bonus funding will leave two thirds of councils having to find millions more in savings than expected to plug funding gaps next year.

“Extra council tax income will not bring in anywhere near enough money to prevent the need for continued cutbacks to local services, including social care.”

Lord Porter said the 3% council tax precept permitted for social care would be “swallowed up by the cost to councils of paying for the government’s national living wage”.

Mr Javid used December’s draft settlement to divert money from the new homes bonus into social care, angering many districts that depend on the bonus.

District Councils’ Network chair Neil Clarke (Con) said: “District councils will be hardest by this final settlement for 2017-18, suffering from a 5.2% cut to core spending power, compared to average 1.1% reductions across the whole of local government.”

He said ministers had failed to listen to districts’ protests about the change to the bonus, which would “have a disproportionate and adverse impact on local communities”.

In recent weeks there had been speculation about more money being made available for social care services, largely as a result of Surrey CC’s decision to drop its plans for a referendum on a 15% council tax rise at the last minute. Mr Javid and Surrey’s leader David Hodge (Con) publicly denied a deal had been struck after leaked texts emerged suggesting an agreement had been reached

Addressing parliament about the issue over social care funding Mr Javid said: “More money is not the only answer. We will bring forward reforms to provide a sustainable market that works for everyone who needs social care.

“And I welcome the consensus across both sides of the House that every area should move towards the integration of health and social care services by 2020, so that it feels like one service.”

Mr Javid said local government “must continue to play its part” in bringing down the deficit.

He said: “I commend all councils for…substantial efforts to modernise, transform local services, and reduce waste so that frontline services can be protected.”


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