Independent Commission on Local Government Finance Eamon Lally CIPFA North West Annual Conference 14...
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Transcript of Independent Commission on Local Government Finance Eamon Lally CIPFA North West Annual Conference 14...
![Page 1: Independent Commission on Local Government Finance Eamon Lally CIPFA North West Annual Conference 14 November 2014.](https://reader030.fdocuments.us/reader030/viewer/2022012914/5a4d1b3f7f8b9ab0599a05a7/html5/thumbnails/1.jpg)
Independent Commission on Local Government FinanceEamon Lally
CIPFA North West Annual Conference 14 November 2014
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The Commission
Terms of Reference• Identify the strengths and weaknesses of
the local government finance system,
• Bring forward practical options for reform in the next Parliament and
• Develop and test those proposals against the key challenges facing the country – growth, housing supply, effective welfare provision, affordable health and social care, and early support to families and children.
Timetable from here: 30 Oct: interim report publishedNov-Dec: Engagement on Interim findingsFeb 2015: Final report
![Page 3: Independent Commission on Local Government Finance Eamon Lally CIPFA North West Annual Conference 14 November 2014.](https://reader030.fdocuments.us/reader030/viewer/2022012914/5a4d1b3f7f8b9ab0599a05a7/html5/thumbnails/3.jpg)
Context: National tax and spend
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Context: The path of future revenue funding – not including schools
2010/11
2011/12
2012/13
2013-14
2014-15
2015-16
2016-17
2017-18
2018-19
2019-20
-£10,000,000
£0
£10,000,000
£20,000,000
£30,000,000
£40,000,000
£50,000,000
£60,000,000
Additional Social Care fundingChange in reservesInvestment incomePublic Health allocationOther grantsFormula GrantRSGRetained Business RatesCouncil tax
£bill
ion
The localisation of council tax support in April 2013 re-duced the taxbase
• Total funding projected to fall to £43.4 billion by 2019/20
• This includes £3.1 billion of Public Health funding which carries with it a new responsibility
• All figures are in cash terms
• In 2013/14, 38% of total funding is from council tax, 19% from retained business rates, and 28% from RSG
Negative reserves figures when councils underspend and contribute to reserves
Public health funding not new money as it comes with a new burden
4Source: LGA's Future Funding Outlook 2014 - outturn data to 2012/13, budget data 2013/14. 2014/15 and 2015/16 based on settlement, 2016/17-2019/20 from LGA projections
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The Commission’s vision
The local government finance system should:
• Promote self-reliance and self-sufficiency• Encourage entrepreneurialism and innovation• Promote local decision-making on service
delivery• Transparency• Maintain support for the most vulnerable
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What the Commission has said it agrees with
• Self-sufficiency• Greater freedom over council tax, including
bands, rate, and discounts• 100 per cent retention of business rates• Devolution of skills and welfare to work
funding• More integration of decision-making across
local public services
6
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Pace and Scope of Change?
• Variable speed reform?• Self-sufficiency over all local public services?• New incentives?• A new approach to equalisation?• Integrated services?• Bold approaches to housing supply problems?
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Self-sufficiency?
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Self-sufficiency at a sub-national level
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Equalisation
• Not all Councils can grow economically at the same pace
• Not all Councils will grow their populations at the same pace
• Councils will face different Levels of demand
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Challenges and questions
• What is the appetite for radical change?• Is there evidence that integrating health and
social care services will create savings? • What incentives are needed if any?• What should the balance be between
incentives and equalisation in the system as it moves towards self-sufficiency?
• How would it work – the wiring diagram?
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Independent Commission on Local government [email protected] Eamon Lally: Tel: 07799768570