Councils need ‘emergency settlement’ from new government

“At the moment, councils have no idea how they will be funded this time next year.”

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Councils need a one-year ‘emergency settlement’ from the Johnson government and a 100-day timetable to make it happen, a think tank has said.

The Local Government Information Unit (LGiU) says the new government must also drop the council tax referendum requirement and draw up a strategy for health and social care funding.

These are recommendations in the LGiU Local Finance Taskforce paper based on evidence taken from 254 senior figures in local government.

On publication of the report, LGiU chief executive Jonathan Carr-West gave the new government 100 days (from 23rd July) to save its local equivalent.

“At the moment, councils have no idea how they will be funded this time next year, they face a financial cliff edge on 31st March 2020, and currently have no ability to budget or plan their services for the year ahead,” said Carr-West.

“Some may soon be forced to take very difficult decisions, based on their worst-case scenario budget estimates – making redundancies, stripping down services, selling valued public assets – that may turn out to be completely unnecessary,” he said.

As reported by 24housing, one in three English councils fear they will be unable to fulfil statutory duties in areas such as homelessness prevention by the end of the present Parliament.

LGiU wants the government to set out a plan for council finance that considers overall quantum, uncertainty and risk, adult social care,  business rates, council tax, and other sources of funding.

The council tax referendum threshold – whereby councils must hold a local referendum on decisions to increase council tax beyond 3% – is “outdated and ripe for removal” the report says.

“Local government deserves better, and local government deserves more,” said Carr-West.

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