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What the Budget means for local government

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Local government has succeeded in achieving the efficiency targets set in the 2004 spending review, a report released alongside the Budget confirms.

According to the report, local government achieved£6.715bn of efficiency savings before the end of 2007 against a target of£6.45bn - the biggest contribution from anywhere in the public sector.

Whitehall departments such as the Department for Children, Schools & Families , the Department for Environment, Food & Rural Affairs and the Department for Culture, Media & Sport are yet to hit their targets.

In his first Budget statement as chancellor, Mr Darling pledged to “examine all major spending areas where further reform could be made to deliver better value for money and maintain the improvement of public services.”

He also announced an overhaul of council and housing tax benefits to make it easier for low income earners to get to work.

Zero-carbon steps

Mr Darling outlined moves to allocate 30% of all public sector business to small and medium-sized enterprises within the next five years.

In addition, the Budget contains steps to introduce legislation to impose charges on plastic carrier bags, while all non-domestic buildings will have to be zero-carbon by 2019.

Mr Darling said the British economy would grow between 1.75% and 2.25% in 2008, slower than last year but faster than Japan, the United States and the Euro zone. And he said that projection for net borrowing is£36bn-£1.4bn lower than at the time of last December’s pre-budget report. He confirmed spending plans in last summer’s comprehensive spending review for public spending to grow in real terms by 1.9% per annum after 2011.

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