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MORE DRAFT REGULATIONS ISSUED FOR REORGANISATION

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The government has published draft regulations on transfer arrangements for local taxes, revenue support grant and ...
The government has published draft regulations on transfer arrangements for local taxes, revenue support grant and compulsory competitive tendering to new authorities under reorganisation. Its consultation paper published last week follows on from an initial paper on the transfer of assets and liabilities circulated in August (LGC, 20 August).

Further consultation papers are promised on regulations covering the treatment of councils' financial reserves and arrangements for collection fund surpluses and deficits.

Advice and guidance on other issues arising from the interaction between CCT and local government reorganisation are also due. Transitional Operation of the Local Government Finance System and Proposed Regulations says new billing councils will be responsible from the date of reorganisation for administering all local taxes in their area.

All billing authorities, including counties which become billing authorities through structural change, will have to operate both a collection fund and a general fund. Any collection fund surplus or deficit for years prior to reorganisation should be shared by successor councils according to their local tax base. Responsibility for budget and council tax setting for the year beginning on the reorganisation date will lie with successor authorities, including new councils in their shadow status.

Special transitional provisions for abolished councils would ensure any RSG and distributable amounts of non domestic rates arising before reorganisation would be made to a designated authority. Special transitional provisions would also apply to budgeting and tax setting, to allow compensation for any difference between payments and the collection fund surplus or deficit of abolished councils. The consultation paper contains two sets of draft regulations.

The first, The Local Government Changes for England (Finance) Regulations 1993, deals primarily with local government finance matters covered in this and August's consultation papers.

The second, The Local Government Changes for England (Miscellanceous Provision) Regulations 1993, deals with CCT and council companies. The regulations reflect the government's announcement earlier this year of an 18 month CCT exemption for councils affected by reorganisation.

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