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GOVERNMENT MUST LOOK AT THE FULL PICTURE BEFORE TAKING CAPPING DECISION

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With a final decision imminent on the nine local authorities singled out for capping*, local government leaders are...
With a final decision imminent on the nine local authorities singled out for capping*, local government leaders are calling for an urgent meeting with local government minister Phil Woolas to highlight the financial pressures on councils.

Local Government Association chairman Sandy Bruce-Lockhart said: 'While the nine district councils have found it useful to put their individual cases to the government, it is imperative that the minister appreciates the wider context of the situation and takes into account the financial pressures facing councils before making a final decision.

'We have made clear our astonishment that nine low tax, low spend authorities should be capped in a year when local government has delivered the lowest average council tax rise in a decade and at a time when councils are already delivering significant efficiency savings. If they mean what they say about greater freedom for local councils, then government should leave the nine councils to make their own local decision about their budgets, based on what local people want.

'Over the last few years central government spending requirements on councils have not been matched by increases in government grant. This has contributed to a massive£1.5bn black hole projected for budgets for 2006.'

The LGA has argued that it is wrong to cap councils, especially on the basis of their percentage council tax increase - all of the nine authorities singled out for capping have below average council tax at Band D. As was the case last year, some councils will be facing rebilling costs that are in excess of the proposed council tax increase per household.

LGC background on the nine here and here.

Note

The initial view of the 2006/06 annual efficiency statements demonstrates that councils are facing the efficiency challenge in a robust manner (see LGC).

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