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LGA calls for 'full assessment' of sector's funding gap

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The Local Government Association has used its submission to the Budget to call on the government to commit to a “full assessment” of the sector’s funding needs.

Central government grant funding for local services is expected to shrink by a further £1.3bn in 2019-20, a figure the LGA said must be reversed by chancellor Philip Hammond.

Richard Watts (Lab), chair of the LGA’s resources board, said: “Losing a further £1.3bn of central government funding at this time is going to tip many councils over the edge.

“In his spring statement in March, the chancellor said he would invest in public services if public finances improve as recent forecasts have suggested. It is therefore vital that the government addresses the growing funding gaps facing councils in 2019-20 in the autumn Budget.”

The LGA in its submission called on the government to “close the £3.9bn funding gap in 2019-20 and commit to a full assessment of the overall funding needs of local government in the 2019 spending review and guarantee to fully fund them.”

In his spring statement in March, Mr Hammond said: “If, in the autumn, the public finances continue to reflect the improvements that today’s report hints at, then, in accordance with our balanced approach and using the flexibility provided by the fiscal rules, I would have capacity to enable further increases in public spending and investment in the years ahead.”

The LGA’s submission reports statistics from the Office for National Statistics that public sector borrowing only totalled £17.8bn at the end of August, compared to the OBR’s full year forecast of £37.1bn.

 

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