The rancour between councils and the Department for Communities & Local Government grew this week, with communities secretary Eric Pickles accused of giving incorrect evidence to a select committee.
Local Government Association chair Dame Margaret Eaton (Con) wrote to Mr Pickles rejecting his claims that councillors had backed down in the debate over how much capital funding they can spend on severance deals.
Referring to Mr Pickles’ recent appearance before the communities and local government select committee when he stated that any increase in the £200m capitalisation allowance for 2011-12 would have to be matched by corresponding reductions in grant, she said: “You went on to refer to your impression that when you made your views known to us we were not keen to press our argument on capitalisation.
“I am afraid that, if that is your interpretation, it is entirely incorrect.”
The LGA has consistently argued that the £200m allowance for capitalisation was inadequate considering the number of redundancies expected to be made next year.
In her letter, Dame Eaton said the restriction “may be a reflection of the current bureaucratic orthodoxy but it amounts in our view to an entirely unjustified constraint on the management of local public spending.
A DCLG spokesman declined to respond to claims that Mr Pickles had misinterpreted events in his evidence to MPs, but he said the minister would shortly reply to the LGA’s letter.
The government has always insisted that increased capitalisation for reorganisation programmes would contribute to the deficit.
Last month, junior local government minister Baroness Hanham said councils should meet the costs from reserves.
The latest row over capitalisation follows a bad-tempered exchange with local government minister Bob Neill over the performance of a small number of councils in collecting refuse over the Christmas period.
Mr Neill described the piling up of rubbish as “disappointing”, said that town halls needed to “show more initiative” and that ministers would publish guidance for councils on how to increase the frequency of collections without incurring further cost.
His comments drew a furious response from the LGA. In a letter to council leaders, environment board vice-chair Clyde Loakes (Lab) said he regretted Mr Neill had written in the way he had.
“We know none of you need any lessons from government ministers about the vital importance of waste collection,” he wrote. “The reports have, at worst, affected 20 out of 350 collection authorities. Regrettably, ministers have chosen to present the issue as one affecting the whole sector. We are urging ministers strongly to ensure future public comments on this issue are evidence based.”
Mr Neill also wrote to LGC this week to dismiss the LGA’s claims that £1bn of money raised through business rates could be handed back to the sector. The LGA said it stood by its assertion.