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Date: 28 Aug 2015
Figures published by DCLG have shown that the 24 Enterprise Zones in England have created 19,000 jobs and attracted 540 companies and £2.2bn of private investment. According to the Government £440m has been spent on developing the 24 zones. Businesses in the 24 zones will receive business rate discounts until 2018. In 2012-13, income foregone from business rates cost the Government £10m. In July, the Chancellor George Osborne announced that he intended to create more enterprise zones; the deadline for bids is 18 September.
Date: 27 Aug 2015
Greg Hands the chief secretary to the Treasury has written to the chairs of the seven independent public sector pay review bodies to say that not every public sector worker can expect to receive the 1% pay increase, announced in the Summer Budget. Mr Hands said the Government would fund a 1% rise for each year of the four years of the next Spending Review period, but that the increases needed to be ‘applied in a targeted manner to support the delivery of public services, and to address recruitment and retention pressures’. The general secretary of the public sector trade union Unison, Dave Prentis, said the 1% pay pledge was ‘smoke and mirrors’, adding ‘It is difficult to see how much targeting you can get from a miserly 1% without resulting in hundreds of thousands not getting a pay rise at all’. Local government pay is determined separately from the central government pay review bodies.
Date: 21 Aug 2015
A joint letter from the Campaign for Better Transport, Campaign to Protect Rural England, Living Streets, Pteg and Sustrans has warned of the risks to 'everyday transport' if local authority transport funding is cut in the Spending Review. The groups warned that as major investment programmes for roads and railways are protected, the expected budget cuts could mean further reductions in bus services, local roads falling into greater disrepair, and targets to increase walking and cycling missed. Stephen Joseph, chief executive of the Campaign for Better Transport The leeter called for the Government to review major transport programmes, especially the Road Investment Strategy, to help rebalance capital and revenue funding for everyday transport.
Date: 20 Aug 2015
The National Living Wage could result in a "catastrophic collapse" in the number of care homes, according to the five biggest providers.
In a letter to the chancellor, they say staffing accounts for 60% of the cost of care.
The companies said they supported the National Living Wage, but efforts would be needed to rescue the care system.
The government said social care would be considered as part of the spending review later this year.
Date: 17 Aug 2015
The Chair of the Local Authority Pension Fund Forum Kieran Quinn has responded to the announcements in the Budget about the development of proposals to pool LGPS investments by saying the sector ‘accepts the challenge of change’. Mr Quinn said the Treasury’s call for funds to develop their own plans was ‘more positive’ than indications from the previous coalition government that it may impose reform, including moves to passive asset management. He added ‘the language is different than it has been previously, and therefore there is much more opportunity for us to find solutions’. Local Government Minister Marcus Jones said ‘Later this year we will set out those detailed criteria and publish a consultation on backstop legislation which will ensure that those administering authorities that do not come forward with sufficiently ambitious proposals are required to pool investment’.
Date: 31 Jul 2015
The Governmnet is to announce a new legal cap on pay-offs from public sector organisations, which will be limited to a maximum £95,000.cap The cap which will be enshrined in legislation, will cover most big public employers, including the civil service, local authorities, the NHS, schools and quangos. A consultation, which ends on August 27, leaves open the possibility of reducing the limit below £95,000.
Date: 28 Jul 2015
The UK Homecare Association (UKCA) has warned the impact of the National Living Wage (NLW) could trigger “catastrophic failure” in the homecare market. The NLW, announced by the Chancellor in the budget, will mean workers aged over 25 will be paid a minimum of £7.20 an hour from April 2016, rising to £9 by 2020. According to UKHCA the costs associated with meeting the living wage will require an additional £753m in funding from councils and the NHS in the first year alone. It says local authorities currently pay homecare providers an average of £13.66 an hour, but estimates that the new arrangements will cost it £16.70 an hour.
Date: 27 Jul 2015
The new chair-elect of the County Councils Network Paul Carter has said counties needed a fairer funding deal in the forthcoming Spending Review. Cllr Carter, leader of Kent County Council said the CCN would oppose further funding reductions for councils, arguing he could ‘not stand-by while counties shoulder a disproportionate burden of deficit reduction or are unduly penalised’. He added that ‘counties face unrelenting demand pressures in areas such as adult social care, but receive four times less funding. Government needs to look at how counties areas can be fairly funded to meet the specific needs of their local populations’. The new chair also called for counties to be able to retain a larger share of business rates and for reform of the New Homes Bonus, as it provided little incentive for CCN member councils.
Date: 23 Jul 2015
Following the Government’s announcement of the postponement of implementation of the Care Act until April 2020, the future of funding to support councils with implementation is unclear. The Department of Health announced in February 2015 that councils would receive £146m in 2015-16 to help them prepare for the implementation of the policy; £30m of the total was to support planning and preparation and the remainder for carrying out early assessments of self-funders from October of this year (£116m). A DH spokesperson said: “In light of the announcement to delay the reforms we will shortly advise local authorities on what will occur with the implementation funding”. However, local government has called for the funding to continue with Paul Carter, CCN spokesperson for health, social care and wellbeing saying “With counties already beginning implementation of the Act, all 2015-16 funding must remain with local authorities’.
Date: 22 Jul 2015
The Home Office has launched the long-awaited consultation on proposals for a new police funding formula. The Policing minister Mike Penning said the current system for allocating central government funding was “complex, opaque and out of date” and needed to be reformed to ensure the available funds are divided fairly. The consultation proposes a new distribution methodology for 2016/17 based on three factors: population levels and taxbase; the underlying characteristics of a local population (such as the number of households where no-one works); and environmental characteristics (i.e. the number of the bars in an area).
Date: 21 Jul 2015
The spending review that will set out departmental budget cuts over the next five years is expected to report on 25 November, a month later than then 2010 spending review. The Treasury will write to departments seeking savings in their totalling £20bn over the period and Cabinet ministers are expected to make their proposals for cuts by September. BBC Newsnight understands specific targets will not be set for departments and the review is likely to concentrate on further land asset sales; Mr Osborne will ask for land capable of building 150,000 homes in this Parliament.
Date: 17 Jul 2015
Flagship government plans to implement a £72,000 cap on an individual’s lifetime care costs are to be delayed for four years due to spending reductions, it has been announced today.
In a written ministerial statement, health minister Lord Prior insisted the government continued to support the policy, devised by the Dilnot commission, but was unable to fund it at the current time.
The £72,000 maximum personal liability was to be introduced from April next year, but will not now be in place until 2020, he said.
Date: 15 Jul 2015
The Government has published a consultation on proposals for inspections of child protection services from four public sector watchdogs. The new Joint Targeted Area Inspections will be introduced by Ofsted, the Care Quality Commission, HM Inspectorate of Constabulary and HM Inspectorate of Probation from this autumn. the inspections will examine how well councils, health services, the police and probation services are working together to protect vulnerable children. The inspections will be undertaken where concerns have been identified about local child protection regime, but it has been deemed disproportionate to undertake a full Ofsted inspection of children’s services.
Date: 13 Jul 2015
Councils have warned they face a £1billion annual bill after George Osborne announced an increased minimum wage. The LGA said the cost of implementing the Chancellor’s national living wage, announced in the Budget, should be taken into account when council funding levels are set. People over 25 will be paid a minimum of £7.20 an hour from April next year, rising to £9 by 2020. LGA analysis revealed that the policy will cost councils a minimum of £340 million a year from next year, rising to more than £1 billion by the end of the decade. LGA Chairman, Cllr Gary Porter, said: “Councils support proposals to introduce a national living wage to help ensure staff receive a fair day’s pay for a fair day’s work. However, our analysis shows the cost to councils of implementing the change will keep growing and reach £1billion by the end of the decade.”
Date: 10 Jul 2015
Council tax rises could be on the horizon after no mention of a new freeze was made in the Budget, it is reported. The local tax was frozen under the Coalition with any council wanting to increase it by 2 per cent or more having to get residents to agree to it in a referendum. The current freeze ends next April. LGA Chairman Cllr Gary Porter said: “Local authorities are striving to keep council tax down but at the same time are grappling with the difficult task of protecting vital services. It should be for councils and their residents to set council tax levels, not Whitehall.”
Date: 09 Jul 2015
The Budget announced by George Osborne on Wednesday revealed lower than expected cuts in public expenditure over the next Parliament. Georg Osborne said there would be ‘no roller-coaster ride in public spending’ in his speech. The OBR judgers that the effect of the Budget had been to ‘loosen significantly the impending squeeze on public services, financed by welfare cuts, net tax increases and three years of higher borrowing’.
Date: 08 Jul 2015
The Chancellor is expected to take three years instead of two to reach his £12bn target for welfare savings. Mr Osborne is expected to reveal details of the cuts in welfare in the Budget, which would be phased in, with £8bn by 2017/8 and a further £4bn by 2018/9. Tax credits are expected to face reductions and there will be a lower benefit cap of £23,000 in London and "lower than that in the rest of the country".
Date: 07 Jul 2015
Ministers are considering shelving the promised introduction of a cap on personal liability for the cost of long-term care, after council leaders asked for the funding set aside for it to be used instead to ease the crisis in day-to-day services for elderly and disabled people.
Date: 07 Jul 2015
Shops across the country will be able to stay open for longer on Sundays, George Osborne will announce in this week’s Budget.
The Chancellor will use his first Budget as Chancellor in a majority Tory Government to begin a massive shakeup of Sunday trading laws that currently prevent businesses opening for more than six hours.
He said that “there is still a growing appetite for shopping on a Sunday” and that businesses need the change to ensure that they can compete with online retailers.
Date: 07 Jul 2015
Funding to help vulnerable children in England has been cut by nearly £2bn over the last five years, say charities. Early help by local authorities has been "a casualty of government spending cuts", say the Children's Society and National Children's Bureau (NCB). They say failure to intervene early means a greater cost to taxpayers later and will "damage young lives". The government said it had increased early intervention funding.
Date: 06 Jul 2015
Local authorities are expected to receive an additional £30m in 2015-16 to support an increase in the number of adoptions. Currently Local authorities or the voluntary sector currently pay a fee of £27,000 to find an adoptive parent outside their district. The funding - due to be announced in Wednesday’s post-election Budget – is designed to speed up the adoptive process, which is currently thought to take 18 months on average per child.
Date: 06 Jul 2015
The opportunity for the London Olympics to inspire a generation of children to participate in sport has been squandered, Tessa Jowell has said.
The government said 1.4 million more people were playing sport each week than when London's Olympic bid was won.
But a spokesman for the Department for Culture, Media and Sport said more needed to be done to attract people from all backgrounds.
Date: 02 Jul 2015
Communities Secretary Greg Clark has told councils they are on the brink of a once in lifetime opportunity to be masters of their own destiny.
Speaking at the Local Government Association annual conference in Harrogate, Mr Clark called on all cities, towns and counties to be ambitious in their proposals to take power and resources away from Whitehall.
Date: 01 Jul 2015
A survey of local authority finance chiefs by CIPFA has found that almost all (94%) of councils said they have plans in place to use the reserves they have built up, with 40% saying they are increasing their reserves because of uncertainty over government policy on areas such as council tax support and localised business rates. CIPFA’s study found councils held around £19.8bn in reserves, of which £2.3bn had been set aside for schools or public health projects, and a further £13.8bn as earmarked reserves.
Date: 30 Jun 2015
The new Chairman of the LGA Cllr Gary Porter has called for the protection of NHS funding to be ended, describing it as ‘a bizarre policy’. Cllr Porter said he believes that £3bn of additional money earmarked for health should be put into adult social care to help people remain in their homes for longer and avoid hospital admissions. He said: ‘If we can stop people getting ill in the first place, it’s cheaper but somebody has to have the courage to say ‘No, we’re not going to spend it all on fixing people at the wrong end. We’re going to stop people getting broken at the start’. Porter, speaking on the eve of the LGA’s annual conference in Harrogate, said no one thought the NHS was providing value for money
Date: 26 Jun 2015
Care services for the elderly, bin collections and pothole repairs will be under threat next year as councils cope with a £3 billion budget cut, the Local Government Association has warned.
Councils are facing their biggest funding squeeze as their annual grant is cut by 12 per cent next year and a further 11 per cent the following year to meet George Osborne’s target to slash spending by £30 billion within two years.
Date: 23 Jun 2015
Council leaders have called for an overhaul of the business rates appeals system, arguing it will undermine vital local services.
An appeal by Virgin Media to merge rates payments for its broadband fibre optic network to 68 councils could see local authorities having to refund £75m and lose future income.
The Local Government Association (LGA) said the case was one of many that councils could face unless the Government takes 'urgent action'.
In its submission to the Government's review of business rates, the LGA argued local authorities should be named as interested parties on appeals so that they have the opportunity to defend themselves.
Date: 22 Jun 2015
The NHS will not survive unless steps are taken to shore up the crisis-hit elderly care system for the long-term, Paul Burstow, the former care minister warns today. He said although spending has been given special protection constant cuts over the past five years to local council budgets that fund social care for elderly and disadvantaged people have left the system “shrivelled” and nothing more than a “crisis care service”. He cited research showing nine in 10 NHS chiefs feel social care is having a direct impact on health care and questioned whether the cap on lifetime care costs and more generous means tests, due to start in April 2016, would be introduced.
Date: 20 Jun 2015
Lorries are bringing “bedlam” to villages because of a rise in the number of lorries attempting to use narrow country lanes, the LGA has warned. It is calling for councils to be given powers to issue fines to drivers caught flouting weight restrictions. Money collected from fines could be used to tackle a £12 billion backlog in the nation’s pothole repairs. LGA Transport spokesman, Cllr Peter Box, said: “There has been a spate of accidents involving lorry drivers driving irresponsibly and bringing bedlam to small rural communities – and action must be taken immediately to curb this. Councils are doing everything they can to help their residents, working with communities by organising lorry watch schemes. But they are trying to take action with one hand tied behind their back and urgently need tougher powers. If a community is being plagued by problems at an accident blackspot, councils should be able to respond to communities’ concerns by issuing fines to act as a deterrent. We would stress that most lorry drivers are reputable and drive responsibly. These powers would be targeted at the minority who do not follow the law. This is also about protecting the drivers’ safety as well as the safety of residents and other road users.”
Date: 19 Jun 2015
The Care Minister Alistair Burt has announced that he has asked the Law Commission to bring forward its work on draft legislation to address the burden of complying with deprivation of liberty safeguard rules. Mr Burt said he had asked the Law Commission to publish draft legislation by the end of 2016, rather than 2017 as originally planned. Mr Burt acknowledged this was ‘still a length of time’ but said the complexity of issues involved meant it should not be rushed. A Stockport MP said her council was spendimng £1.2m a year applying deprivation of liberty safeguards.
Date: 19 Jun 2015
Essex County Council has set out a three-year “invest to save” plan in order to ensure it can continue to provide public services while also balancing its budget.
Speaking to Public Finance as the authority published its out-turn report for 2014/15, cabinet member for finance John Spence said reducing demand was key to ensuring the long-term sustainability of the authority.
Since taking up the finance brief last September, Spence said he had focused on schemes that could cut spending – called “invest to maintain”, “invest to grow” and “invest to save” – in response to government funding reductions.
Date: 19 Jun 2015
Neither the Treasury nor the Cabinet Office currently monitor how well payment-by-results schemes work, despite £15bn being spent through the contracts, the National Audit Office has said.
There are at least 52 PbR schemes currently operating including high-profile initiatives such as the Work Programme and the Troubled Families Programme.
The contracts are intended to incentivise firms taking on public services to innovate in areas such as getting people into work or improving children’s school attendance, as most payments are only made when targets are reached.
Date: 19 Jun 2015
The public transport system is failing the oldest and most vulnerable in society in England, according to a new report. ‘The Future of Transport in an Ageing Society’ was compiled by think tank the International Longevity Centre-UK (ILC-UK) and charity Age UK. It says millions of older people are faced with travel problems with more than half of over-65s either never using public transport or using it less than once a month, despite being eligible for free bus travel. The report also claims it is the oldest, those in poor health and those living in rural areas who are let down the most by public transport.
Date: 18 Jun 2015
Hillier, who served as a Home Office minister from 2007 to 2010, emerged victorious from a contest with fellow Labour MPs Helen Goodman, David Hanson and Gisela Stuart.
In her candidate statement for the post, Hillier pledged to focus on proper accountability of local services, particularly in the NHS and education, and also proposed that the committee undertake more pre-legislative scrutiny of large projects on a value-for-money basis.
Speaking after the announcement, Hillier said she was "delighted to have the opportunity to continue to challenge the government and public service providers and to press for more efficient and effective services for users".
Date: 17 Jun 2015
The Government has been warned not to use the reform of business rates as an 'excuse' to reduce funding for local authorities.
Chief executive of the Chartered Institute of Public Finance and Accountancy, Rob Whiteman, warned a move to Consumer Price Index (CPI) to calculate rates ‘must not further reduce funding for local authorities whose budgets are already stretched’. ‘This should not be an excuse to undercut funding to local government by this amount.
‘Any such reform to the way business rate increases are calculated must ensure funding for councils remains fiscally neutral.’
Date: 16 Jun 2015
The audit firm Grant Thornton has published its findings from a roundtable meeting of senior 34 local authority finance officers. The report argues that a more balanced relationship is needed between central and local government. In particular, delegates at the roundtable said a new funding model was required that provides local government with more autonomy, allowing it to take responsibility for ensuring its own financial stability, whilst addressing the dual needs of 'resource equalisation' and 'incentivising growth’. The report proposed a series of 3-year pilots which would allow different emerging models of finance reform to be tested.
Date: 15 Jun 2015
A report by the National Audit Office has warned that local authorities are at risk of a funding shortfall in implementing the Care Act, as a result of uncertainties about demand for support and problems in government costings estimates. The NAO said the Department of Health had implemented the Act well, noting it had consulted carefully and involved the sector significantly. However the report said DH’s estimates of the costs of the reforms and allocated funding could underestimate the demand for assessments and services for carers and councils may not have the resources to respond if demand exceeded expectations. According to the auditors there has been a 29% fall in the number of people receiving council-funded support from 2008-9 to 2013-14 a £1.1bn reduction in budgeted net spending on adult social care by councils from 2010-11 to 2014-15.
Date: 15 Jun 2015
More than 80,000 shops could close in the next two years without a drastic overhaul of business rates, ministers were warned yesterday. Changing shopping habits coupled with the growing tax burden means almost two out of three town centre shops could shut by 2017 with the loss of 800,000 jobs, the British Retail Consortium claimed.
Date: 12 Jun 2015
A report by the National Audit Office on DCLG’s new burdens policy has found that the Department ‘needs to use intelligence from the new burdens regime better’ in order to understand the pressures affecting local authorities’ financial sustainability. Whilst many new burdens are small, the NAO said their cumulative impact could matter and should be considered when government sets local authority funding. The rport dound that DCLG had taken steps since November 2014 to improve its understanding of new burdens, but added ‘it will need to continue to do so, to feed this knowledge into the next spending review’.
Date: 12 Jun 2015
Councils are letting pothole-strewn roads deteriorate in an attempt to claim funding, said the transport minister. A series of “perverse incentives” had been created in recent years that have allowed local authorities to “let standards slip so as to win more money”, Andrew Jones claimed as he unveiled a £578 million fund that will be allocated on councils’ ability to spend money wisely. This includes proving that upgraded roads remain pothole-free for as long as possible and sharing resources with neighbouring councils.
Date: 11 Jun 2015
The primary school population in England has continued to rise sharply, with 94,000 extra pupils this year, reaching the highest levels since the 1970s. The 2.1% increase in primary numbers is equivalent to six more pupils for every school. "Minority ethnic pupils made up 71% of the increase," says the Department for Education's school census report. The annual figures show there are now more super-sized primary schools. It will mean more funding demands to create extra places and pressure on places for families looking for schools
Date: 11 Jun 2015
Further cuts in government spending will be needed beyond this parliament in order to bring the national debt under control, the Office for Budget Responsibility (OBR) has warned.
In its annual report, the OBR said that without further spending cuts or tax rises, the national debt would only increase.
It said a permanent £20bn cut in annual public spending will be needed by 2020.
That would help bring the national debt down to 40% of GDP by 2064, it said.
Date: 11 Jun 2015
Councils could find themselves forced to cut services due to a potential shortfall in funding for major changes to the social care system, the National Audit Office has warned. The LGA said the potential costs of the Care Act could lead to a £50 million black hole which will have knock-on effect on other local services. Cllr Izzi Seccombe, Chairman of the LGA's Community Wellbeing Board, said: "Councils are implementing the Care Act at a time when rising demand and escalating costs means that the adult social care system is already under immense stress. Unless the Government fully funds all new burdens brought in by the Care Act then vital reforms to improve care and support for the elderly and disabled could be jeopardised.”
Date: 10 Jun 2015
The SCT has responded to the latest Association of Directors of Adult Social Services (ADASS) budget survey, supporting ADASS’ view that the Government's promised extra £8bn investment in the NHS could go to waste unless action is taken to reduce funding pressures on care services. The survey shows that in 2015/16 a further £1.1billion of savings on adult social care budgets are planned with cumulative savings over 5 years now amounting to £4.6 billion. In a joint statement the SCT together with the other local authority treasurers’ societies said: ‘As finance professionals we believe there is a strong business case to invest in adult social care and we urge the Government to commit to this investment in the forthcoming Spending Review’.
Date: 10 Jun 2015
Chancellor George Osborne plans to push ahead with introducing a rule that will commit future governments to spending no more than they collect in revenue.
Mr Osborne will use his annual Mansion House speech later to outline his plan to limit governments to a balanced budget in "normal" times, defined as any time the economy is growing.
Date: 09 Jun 2015
A forthcoming hike in the bankruptcy threshold is likely to hit councils and housing associations hard, a leading accountancy firm has warned.
From October this year, creditors must be owed at least £5,000 before they can initiate bankruptcy. This is significantly up on the current level of £750.
Moore Stephens partner Michael Finch said: “These figures highlight the impact that the unexpected steep rise in the bankruptcy threshold is likely to have, with public sector bodies having a crucial tool for debt recovery taken away. Some are likely to be forced to write off a substantial number of small debts.
He warned that the change to the regulations could see some “serial debtors” start to view council tax debt in particular as optional if they know the local authority has only limited means to pursue them.
Date: 04 Jun 2015
Adult social care firms are struggling to hire, retain and train staff as a result of cuts to council budgets, a survey of senior officials suggests.
Councils in England are facing a £1.1bn shortfall this year, on top of "almost unendurable" cuts since 2010, the Association of Directors of Adult Social Services has warned.
Freezing care provider fees to save money was no long sustainable, it said.
Ministers say extra money will help NHS and social care services work together.
The survey, which was completed by 147 directors of adult social services for councils in England, suggests that funding reductions to social care budgets have totalled £4.6bn since 2010 - a 31% overall reduction.
Date: 04 Jun 2015
George Osborne should spread the pain of tough public spending cuts beyond the next two years, according to the OECD in a critique of the chancellor’s debt consolidation strategy.
The Paris-based thinktank said in its latest economic forecast that delaying some of the severe cuts planned by Osborne for the financial years 2015-16 and 2016-17 would “lower the impact on growth”.
Date: 04 Jun 2015
Whitehall in-year budget review process completes, identifying further asset sales, underspends and efficiencies to smooth path of departmental savings. Making an early start on tackling the public finances in this Parliament, the Chancellor today announced £4½ billion of new measures which will bring down public debt this year, including a major boost to the Exchequer from completing the privatisation of the Royal Mail.
Date: 04 Jun 2015
George Osborne has revealed £230m will be cut from the Department for Communities and Local Government’s (DCLG) spending budget this year, as part of £3bn saving measures.
The chancellor today announced unprotected departments across Whitehall would be required to find average spending reductions of 3% this year, in what the Treasury is describing as a ‘significant first step’ toward finding further savings.
A total of £3bn will be saved from departments over 2015-16 though efficiencies, tighter budget controls to drive underspends and the pushing through of asset sales.