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The Story so Far
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What Next?
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Responses to Continuing Austerity
The Story So Far - 2014/15 Budgets
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Road maintenance budgets are falling, along with park and footpath
maintenance, and street lighting
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Planning and economic development budgets are reducing
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Libraries, leisure services, arts centres and museums are closing and
reducing their hours and staffing
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Youth clubs are closing and reducing to fewer sites
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Regulatory services that local people rely on for protection including
environmental health and trading standards are reducing staff
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Non-critical care services, including day care, respite care and
children’s centres are closing
The Story So Far - Council of Europe
• The ability of councils to provide "essential public services,
quality health and social care and effective and adequate
community services and facilities is under huge pressure
following austerity measures
• Recommends devolution of powers to councils as "the ability of
local authorities to discharge their responsibilities sometimes
appears to be highly restricted by central government"
• Despite significant funding reductions themselves, councils in
Wales and Scotland are "better off financially than their English
counterparts"
• A diversified base of local revenue is an "urgent necessity" with
council tax "limited by central or devolved governments, due to
the referendum obligation" while "all rates are decided by
government and funding is still dominated by central
government grants"
The Story So Far - Council Tax Support and Welfare Reform
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71 per cent of the 326 local authorities have introduced schemes with minimum
payments for working-age claimants from 5 per cent to 33 per cent of a Council
Tax bill
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73 per cent of District Councils said that they had passed some or all of the
reductions
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42 per cent of district councils have set up discretionary hardship funds to help
reduce the financial impact on some individual claimants
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90 per cent of London, metropolitan and unitary councils passed all or some of
the reductions on to claimants
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Transferring risks and costs to local authorities, by localising Council Tax support,
adds to the broader financial challenges for local authorities. DWP/CLG have not
yet quantified the potential financial impacts of the government’s welfare
reforms, which could lead to increased demand for local authority services
What Next? - Spending in 2015/16 and beyond
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As part of continuing austerity programme the Chancellor has
announced further spending cuts in 2015/16
Cumulative cut in DEL of around 10.3% over 5 years
Cuts in 2015/16 in line with SR 2010 departmental priorities
Protection for some (Health, Education and International Development)
means deep cuts for others
CLG and FCO over 50% cut to DEL by 2015/16
Austerity likely to last well beyond 2015/16
Assuming no tax increases or cuts to AME would mean further cuts to
DEL in 2016/17 & 2017/18
IFS estimate that in this scenario would mean another likely 7.9% cut
from DEL
Responses to Continued Austerity – Collaboration and Shared
Services
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Back Office is a well trodden path
Scope for increased front line collaboration and sharing, examples
include Police with the Home Office looking at Fire and Police mergers
Collaboration providing challenges for finance
 Finance staff in shared service arrangements
 Role and responsibility of CFO
 Accounting for Collaboration
CIPFA to update work on Sharing the Gain
Review of the Role of the CFO in Local Government document
Responses to Continued Austerity – Local Spending
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Key to real long term savings is working across the public sector
especially on the prevention agenda
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Issues about joining up budgets and the misalignment of investment
and savings
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Greater Manchester City Deal for the first time involves access to some
benefits expenditure
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Prize is there for the taking but there is no simple answer
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Working group set up to propose guide to mapping local expenditure
Responses to Continued Austerity – Local Government Finance
Commission
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Continued problem of political interference in local government funding
mechanisms
Current system rewards growth only at the expense of less well
performing local authorities
Need for transparency and openness in resource distribution process
Need for independent comment and advice to government on the
overall adequacy of the settlement for local government
Local Government Commission set up by CIPFA and LGA
Independent commissioners have been appointed with dedicated
secretariat support form both organisations
Will report during 2014 on recommendations for reform of local
government funding system