Latest Public Sector News

17.12.18

LGA Autumn Budget round up

Source: PSE Dec/Jan 2019

Chairman of the LGA Lord Porter puts the chancellor’s Autumn Budget under the microscope and looks at what it means for local government.

The chancellor’s latest Budget shows that the government is listening to the LGA’s call for desperately-needed investment in our local public services.

The LGA’s Budget submission highlighted the need to urgently plug the funding gap facing councils in 2019-20. The chancellor has acted to help tackle some of the immediate funding crisis, but more investment will be needed in the long term.

Philip Hammond announced an additional £650m for social care to tide it over to the Spending Review, as well as an extra £420m for potholes and road repairs, £240m for transport in the six mayoral combined authorities, and £675m to revitalise our high streets.

While funding and a few of the measures announced will ease some of the immediate financial pressure facing our local services, it falls short of what we need in the long term. Local government in England continues to face significant funding gaps. Rising demand for adult social care, children’s services, and homelessness support will continue to threaten other services our communities rely on, including libraries, cleaning streets, and maintaining park spaces.

It is good news that the government has accepted our long-standing call to scrap the housing borrowing cap immediately. We will support councils to build those good-quality, affordable new homes and infrastructure that everyone in our communities needs.

We are pleased that the government has provided desperately-needed funding to help revitalise our town centres, and it is important that councils, with their place-shaping roles, have full flexibility over how this funding is spent.

In addition to announcements on housing, social care, high streets, transport, and planning, the Budget also included proposals on many other issues affecting councils, ranging from business rates, skills and employment, land value uplift, and counter-terrorism to the NHS and public health, teachers’ pensions, universal credit and housing benefit, Brexit preparations, and serious violence.

The LGA continues to brief and lobby parliamentarians and ministers as part of its wider work to secure a good financial settlement for local government in next year’s Spending Review, and to promote its recommendations on adult social care ahead of the long-awaited green paper.

It is critical that the chancellor takes the opportunity to tackle the long-term financial challenges facing local government in the Spending Review. This will allow councils to play a full part in the prosperity of the nation and, through preventative work, reduce the wider costs on public services.

Investing in local government is good for the nation’s prosperity, economic growth, and its overall health and wellbeing. We now urge the government to use the forthcoming Spending Review to deliver a truly sustainable funding settlement for local government.

Social care

  • An additional £240m in 2018-19 and £240m in 2019-20 for adult social care, as well as a further £410m in 2019-20 for adult and children’s social care.

LGA view: “Although welcome, this funding will only address some of the short-term pressures facing adult social care. It does not address the full extent of all immediate pressures, let alone pave the way for a sustainable, long-term future.”

Children and education

  • £84m over five years for up to 20 local authorities to help more children stay at home safely with their families;
  • £400m for schools in England to spend on equipment and facilities.

LGA view: “The £84m is a small step in the right direction, but councils in England face a £1.1bn shortfall in the next year alone just to keep services running at current levels.”

Housing

  • The housing borrowing cap has been abolished;
  • An extra £500m for the Housing Infrastructure Fund (HIF);
  • £10m capacity funding to support housing deals in authorities with high housing demand.

LGA view: “Additional funding to the HIF will enable the delivery of new homes. It is crucial that this is allocated to projects quickly so that works can continue as soon as possible.”

Roads and transport

  • £420m for local authorities for potholes, road and bridge repairs;
  • An extra £240m for transport investment in the six metro mayor areas.

LGA view: “Only through long-term, consistent and fairer government investment in transport in all areas can councils embark on the desperately-needed improvement of our local roads and transport networks.”

Business rates

  • Bills will be cut by one-third for retailers with a rateable value below £51,000;
  • 100% business rates relief for all public lavatories from 2020-21;
  • Local authorities will be fully compensated for loss of income resulting from these changes.

LGA view: “It is imperative that the government finds a better way to deal with the impact of business rates appeals as we move towards greater local business rates retention.”

Digital infrastructure

  • £200m to pilot full fibre internet in rural areas;
  • Consultation on requiring new homes to be connected to full fibre broadband.

LGA view: “The government did not announce any investment to improve poor mobile coverage in rural areas. Councils are keen to work with mobile operators to improve connectivity and need government backing to pilot new solutions."

Top image: Stefan Rousseau via PA

 

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