The minister said: 'This 5% increase in general support grant is almost double the rate of inflation. It will build on the substantial growth of recent years. It is a fair deal and reflects my view that Wales needs effective local authorities that are properly resourced.
'In order to assist local government this draft announcement is earlier in the year than ever before and is far more comprehensive in referring to special grants and capital grants.
'I am fulfilling a very important Welsh Assembly Government commitment in providing a Deprivation Grant totalling £20m. This will be distributed by formula and is available in 2004-5 and in successive years. All local authorities are allocated some part of this grant but it is targeted at the poorest parts of Wales and is a part of our programme to achieve social justice.
'Local government and the assembly government have a shared commitment to achieve the strategic aims of better health, an economy for all and stronger communities Wales. The £30m Performance Incentive Grant will be made to local authorities as they set new targets to improve performance in those areas which fit the strategy. This is real collaboration across government in Wales.
'Approximately 80% of our funding to local government is not ring fenced ??? local authorities are able to judge local needs and plan their budgets according to those needs. We respect local democracy and believe we are striking the right balance between the need f or local choices and the strategic aims of the Welsh Assembly Government.
'This settlement builds upon the evidence of spending needs provided by the Welsh Local Government Association. We have listened to the concerns of councils over the cost of implementing the teachers' workload agreement and have provided £33m for this purpose.'
'£526m ??? on average a 4% increase ??? will be available for capital projects. This includes provision for school building and local housing investment.
'Politics is about priorities. Responsible politicians in the assembly and in local government recognise that there will always to be the pressure to make choices. I trust their judgement of our councillors to decide local priorities just as I trust their judgement on the balance between local taxation and local expenditure.'
Assembly Support for Local Government 2004- 05
Local AuthorityAssembly Support*% increase
Isle of Anglesey75.24.2
Neath Port Talbot149.84.0
Vale of Glamorgan113.73.7
Rhondda Cynon Taff266.44.6
Merthyr Tydfil 68.03.7
Blaenau Gwent 82.45.1
* Assembly support for revenue expenditure plus the estimated effect of concessionary fare reimbursement and excluding PFI revenue consequences.
2.The Standard Spending Assessment (SSA) formula is used to calculate the Aggregate External Finance (AEF). The SSA f ormula takes into account a range of factors including measures of population, the extent of deprivation and the urban/rural mix. Examples of these measures are the number of school pupils, the number of older people and the number of people on income support.
3. The total settlement provided to local authorities includes a number of grants and allocations. The Deprivation Grant was introduced last year and is based on the Welsh Index of Multiple Deprivation which reflects a wide variety of indicators of deprivation.
4. The Performance Incentive Grant was introduced three years ago in relation to performance targets agreed with local government. These targets are across the wide range of services provided to local tax payers including education, social services and transport. The grant is funded in full in 2004-05 in anticipation of local authorities agreeing new targets which complement the strategic aims of both local government and the assembly government.
5. Data has also been included in the tables to identify the estimated effect of the concessionary fares reimbursement scheme and the revenue consequences of PFI projects on the amounts received by local authorities.
6. The variation in the rate of increase in grant support reflects in large part the estimates of population changes provided by the Office for National Statistics.