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Settlement delivers inadequate level of protection for counties

Source: PSE Feb/Mar 16

Cllr David Finch, leader of Essex County Council, outlines a four-point plan to alleviate the pressures faced by shire counties following the recent financial settlement.

The recent very vocal public reaction to the funding settlement offered by the government to county councils should have left no-one in any doubt of the degree of unhappiness in and around the shires, nor of the pressures that shire counties are under. 

In Essex, we were quick to express our disappointment to ministers who, to their credit, appear to have been in listening mode since. 

Now we are in period of relative calm while, we hope, the number crunchers at DCLG and their political masters come up with a solution that recognises the challenges that counties – with their ageing populations – face. [Editor’s note: This piece was written shortly before the government issued the final settlement, which came out on 9 February. More on that on page 4 and at the PSE website.

Stark predicament 

It’s pretty easy to illustrate the stark nature of our predicament. 

Even with the additional freedom to levy 2% on council tax for social care, the amount county councils would raise in extra tax would be less than half (£854m) of what had just been cut.

Counties are willing to, and indeed have, played their part in reducing the national deficit, seeking efficiencies and further savings. We have proven during the last Parliament that we can meet all the challenges of funding reductions at a time of rising demand, alongside making efficiencies, sharing services and increasing commercialism. And all the while, balancing our budgets and continuing to safeguard key services. 

The other side is our requirement for greater protection for all upper tier councils, so that we can continue to provide adult social care and children’s services. Council tax flexibility through the precept and additional funding through the Better Care Fund (BCF) can go some way to addressing our concerns. However, the extra funding for social care through these reforms still remains inadequate to meet the existing funding gap for social care over the next two years. 

Four-point plan 

For counties, the situation has been compounded by the current proposals on the distribution of grants and inadequate formulae used to distribute the BCF. Overall, the proposals mean counties have not been offered an adequate level of protection, particularly over the next two years. 

In a recent letter to the prime minister, I set out a four-point plan, which would help ameliorate matters considerably. Our ask was: 

  1. Bring the BCF forward by one year, so helping what will be an incredibly difficult year in 2017-18, and redistributing that on a fair basis.
  2. Revisit the grant distribution for 2017-18 on the basis of need, more fairly recognising the real pressures placed on social care authorities.
  3. Remove the council tax freeze grant element from the revenue support grant, and give it to us on the basis we were promised – as a permanent funding source.
  4. Give councils more flexibility and freedom to locally manage council tax regimes, allowing for reviews of areas such as single person discounts. 

The government didn’t give us much for Christmas, but we can hope that in the spirit of St Valentine’s Day, they may show us a little more love.

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