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New cuts could escape scrutiny, LGA warns

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Civil servants have been criticised for releasing “a ream of dense technical documents” on council funding at a time when many people are away on holiday.

LGA chairman Sir Merrick Cockell (Con) said the funding details would mean cuts of up to 15% for some councils, necessitating service reductions, but were likely to escape thorough scrutiny because they were released during the summer holiday period.

The documents, released at the end of last month, set out how a number of new funds and initiatives are to be financed by top-slicing money destined for councils next year and the one after.

Sir Merrick said: “It is particularly frustrating that the government has announced its plans in a ream of dense technical documents during the parliamentary recess when there will be limited opportunity for them to be publicly examined and scrutinised.”

Although the top-sliced money will be handed back to some councils, such as those with health and social care responsibilities or troubled families teams, the LGA said uncertainty about how it would be distributed left councils having to budget as if the money did not exist.

“Councils need to be able to make accurate financial plans based on clear information. This funding settlement simply does not provide the certainty councils need,” he said.

“The government’s approach to allocating funding will lead to unnecessary cuts to local services. The uncertainty over how much money will be available to councils means they will have to assume the worst and plan for it. No business would choose to operate in this environment and no other part of the public sector is expected to. It is not fair to residents to create this damaging uncertainty.”

The LGA has calculated that the top-slicing totals more than £1bn in 2015-16, leaving councils with far less money than they imagined after the chancellor announced a 10% funding cut in the June spending round.

As reported by LGC, this and other aspects of the technical documents have provoked protest from within the local government sector.

Although the largest cuts are to be applied in 2015-16, Sir Merrick said residents would see the impact before then. “The impact on services is likely to come much sooner than 2015/16 as many councils will be compelled to hold money from the intervening years in reserve in order to ensure they can balance the books as they are legally required to do,” he said.

A spokesman for DCLG said: “To help tackle the deficit left by the last administration, in the recent spending round, the coalition government set out a saving of 2.3% for 2015-16 in overall local government spending, including funding from central government, business rates and council tax income. This change is balanced with a progressive package of measures which create a real opportunity to transform local services and help deliver better outcomes for less.

“It is disingenuous of the LGA to suggest there are further budget reductions since the total amounts allocated to local authorities have not changed since the spending round.”


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Readers' comments (1)

  • So just when there are signs of a recovery (but not a good quality one) Osborne is covertly planning to take money out of the economy. May be it is in a good cause - ameliorating the dire effects of the bedroom tax and UC?

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