Planning and highways spending slashed

Copied from Local Government Chronicle on line
29 August, 2013 | By Ruth Keeling

Planning and highways have seen the largest reductions in spending, according to the latest local government financial data published on Thursday.

Expenditure on planning services fell by 13.2% between 2011-12 and 2012-13 while spending on highways and transport services fell by 9.5% over the same period.

The cut in spending on services linked to growth, a number one priority for the government, contrasts with much smaller cuts in social care spending and increases in spending on housing benefit costs.

The LGA has previously warned that the combination of growing demand for social care services and significant funding cuts would mean spending in other areas, such as planning and highways, would be squeezed harder and harder.

Social care spending fell by just 0.2%. However that masked a different story for children’s social care, where spending increased by 2.8%, and adult social care, where spending fell by 1.4%.

Other areas of increased spending were housing benefit costs, which increased by almost 5%.

Although education spending fell by 7.7%, government statisticians warned that comparisons should not be made over the two years because the reduction was caused by academies leaving local authority control.

While total revenue expenditure fell by 5% between 2011-12 and 2012-13, the reduction was just 0.2% once changes to education responsibilities and funding were removed from the comparison.

The figures also show that councils increased their reserve levels by £1.7bn, not including a £0.9bn addition to the Greater London Authority’s reserves.

However, there were a quarter of councils which did not add to reserves and ended the year with less in the bank.

Early figures reveal cuts of 16% for some councils

Copied from Local Government Chronicle online
8 August, 2013 | By Ruth Keeling

Councils forced to revamp their savings plans after early sight of their individual funding allocations revealed cuts as high as 16% in 2015-16.

The indicative allocation figures, released last month by the Department for Communities & Local Government, have caused alarm within local government which had expected cuts of around 10%.

Councils suffering the deepest cuts have warned they could now be pushed towards a ‘doom’ scenario where services would have to be closed and vital growth plans ditched.

The extent of the cuts is the result of a series of ‘top slices’ taken from councils’ revenue support grant to fund central government programmes, such as the ‘Dilnot new burdens’ budget announced by the chancellor last month.

The hardest hit councils have been told their funding settlement assessment could fall by 16% in 2015-16. Only two authorities, Wokingham BC and Surrey CC, face cuts of less than 10%.

North Kesteven is among 69 councils facing a 16% cut. Deputy chief executive Alan Thomas said the authority might have to rethink its growth priorities. Its previous £1.75m saving plan will now have to be increased to £2.25m, equivalent to 15% of its £11.5m a year net budget.

Mr Thomas said the Conservative-run council might also review its existing policy of reserving New Homes Bonus payments for infrastructure spending. “I think we are going to have to take a different view of that now and use quite a bit of that New Homes Bonus to support core spending, otherwise we won’t be able to balance the books,” he said.

The authority was already reeling from the “absolutely devastating” government announcement that up to 35% of New Homes Bonus income will be handed to local enterprise partnerships from 2015-16, he added.

Districts and inner London boroughs were the hardest hit group of councils in 2015-16, facing 15% cuts on average. Outer London boroughs, metropolitan districts and unitaries face reductions of 14%; counties will see an average reduction of 13%.

David Huxtable (Con), cabinet member for resources at Somerset CC, which faces a 15% cut, said the reduction matched its most pessimistic plan and would have “a huge impact on services”.

He said: “We will have to stop doing things… We will only be looking after statutory services.”

While the early release of individual figures for 2015-16 has been welcomed, treasurers bodies are due to meet senior civil servants to discuss missing details in the coming months.

Brian Roberts, former president of the Society of County Treasurers and Leicestershire CC director of corporate resources, said: “Having these before the summer recess is very helpful. But there is still a lot of uncertainty.”

Scrutiny is no more than whistling in the wind

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Nearly every other day now, councillors are being told that they are, ‘key to driving forward the innovations needed to transform local government, so that it can weather the current financial storm being visited upon it by Westminster’.
Along with this often junior government minister uttered blurb, which is actually code for we’re passing the buck – they wouldn’t describe it as a ‘financial storm’, but rather, local government doing its bit – comes advice that the scrutiny process is an integral element in any transformation strategy.
It’s somewhat disingenuous to identify scrutiny as the way forward, given the abysmal record it has even when richly resourced and supported, as in the case of the Parliamentary scrutiny system.
Almost every other week we hear and read statements from various Parliamentary committees, with Keith Vaz and Margaret Hodge having a seemingly insatiable appetite for appearing on our TV screens, with the opening words, “The government needs to….”, yet what difference does it make to what the government actually does?
Translate this to the amateur, volunteer ‘scout master’ world of the local government councillor, where officer support is always at a premium and constantly under threat from the slash and burn economics of deficit reduction, and scrutiny looks more like whistling in the wind, than an insightful process, that can beat a path to innovative service delivery.

By way of a footnote, I would point to the recent revelations regarding the Lincolnshire Hospitals Trust. Lincolnshire County Council has a health scrutiny committee, with South Holland District Council represented by an independent councillor, who takes every opportunity to tell us what the committee is, or more accurately, isn’t doing. I say isn’t doing, because, in theory, if LCC’s scrutiny of our local hospitals was in any way effective, Lincolnshire hospitals wouldn’t have one of the highest abnormal death rates in England would it? Unfortunately, they seem to have gotten themselves completely hung up on the proposed changes to our local ambulance service instead.

£2bn cost to British businesses of European red tape

So now we have the evidence, what are our leaders going to actually do about it? Especially the bit about our own civil servants ‘gold plating’, that can be fixed immediately.

By Robert Watts – Sunday Telegraph – 21st July 2013

COMPLYING with European Union regulations is costing Britain billions of pounds a year, the first official audit of the cost of membership is to disclose.
The burden on British businesses will be laid bare in a series of reports which will be published tomorrow by William Hague, the Foreign Secretary.
The audit is made up of six reports – called “Balance of Competences” – which civil servants have spent months preparing.
Senior Conservatives hope the reports will form the bedrock of a renegotiation with Brussels, if David Cameron wins the 2015 general election.
Evidence published alongside the reports will show:
• More than 400 new laws have been passed by the European Parliament since the Coalition was formed three years ago, with legislation costing British business £676 million a year;
• Complying with the EU Agency Workers’ Directive costs British firms as much as £1.5 billion a year;
• Less than half of foreign aid money paid by EU institutions goes to help the world’s poorest people.
The initial documents will look at how the EU affects British taxation, health, overseas aid, foreign policy, animal welfare and food safety.
One of the reports will also provide an overview of how the single market affects British businesses.
A further 26 reports will be published in coming months, in a boost to the Euro-sceptic wing of the Conservatives.
However, Tory Government sources indicated that Lib Dem elements of the Government had “sexed down” some of the more critical evidence of EU waste and bureaucracy.
“These are sober documents that provide evidence and analysis about Britain’s relationship with Europe – they do not set out future Government policy,” said a senior Foreign Office source.

It is understood one of the key themes of the reports will be that civil servants in Whitehall often “goldplate” EU regulations unnecessarily to make such laws more onerous than necessary.

Open Europe, the Euro-sceptic think tank, described the reports as a “useful exercise that will inform the EU debate for years to come”. Stephen Booth, a researcher for Open Europe, added: “Unless this review is complemented by a more political strategy to set out the parameters of a future EU renegotiation to secure more flexible UK membership terms, it will not be sufficient.”
The Prime Minister ordered the series of reports on EU influence in July 2012. The documents focus on how each Whitehall department is influenced by the EU, as part of the Prime Minister’s plan to negotiate a new deal without forcing Britain to leave the EU entirely.
The Government also sent out a wider survey to all 26 member countries asking for their opinions on the balance of power between the EU and national parliaments. However, Mr Cameron’s aims received a setback when France and Germany declined to take part in the exercise.
A senior Lib Dem source confirmed that Nick Clegg, the Deputy Prime Minister, and other fellow party members had been through the Balance of Competences studies. “We have fed into and amended these documents just as we would any government reports,” the source said.
“These documents are not about providing Tory Euro-sceptic headbangers with ammunition to help Britain leave the EU. This is serious, meaty work to assess the pros and cons of what the European Union does for Britain.”
A submission by the British Chambers of Commerce will argue that though its members value the single market, firms often feel stifled by regulations.
“Many of the rules governing the Internal Market are overly complex and expensive to comply with, which has resulted in burdensome and unacceptably high regulation costs for UK business,” it reads.
“The widespread feeling among chamber members is that there have been a number of instances where they were provided with insufficient warning or advice before a new rule was introduced.”
Support for Mr Cameron has rallied on the Tory’s traditionally Euro-sceptic back benches since he set out a new policy on Europe earlier this year.
The Prime Minister said that if the Conservatives won the next general election he would seek to renegotiate Britain’s relationship with Europe. Once the negotiation is complete, Mr Cameron would ask the British public whether it wants to remain part of the EU in an “in-out referendum”, to be held by 2017 at the latest.
So far, the Conservatives are the only party to commit to an EU referendum. However, a private member’s Bill tabled by the Tory backbencher James Wharton aims to introduce legislation that would oblige any party that won the next election to hold such a vote.
In an interview with The Telegraph this weekend Graham Brady, the chairman of the 1922 committee, urged Mr Cameron to set out clearly what he hoped to achieve from a renegotiation with Europe. “We should be driving for a very profound renegotiation with Europe with very little political integration,” he said.

Local government has another 10% to find – for starters

I’ve borrowed this from the article published in today’s Sunday Telegraph – thank you ST. The further 10% cut in funding to local government, has been on the cards almost since the last cuts were announced, so that’s not the interesting bit.

What is interesting, is the Telegraph’s assessment that this is a defeat, I assume for the DCLG and Eric Pickles, as that couldn’t be further from the truth, given Mr Pickles constant eagerness to please his bosses. Let’s not forget, he was the first minister to settle, if that’s the right word for it. It’s more likely that Pickles was actually waiting outside the front door of the Treasury on the first day of this spending cuts round. He was probably like one of those over excited shoppers on the first day of the January sales, but in reverse. Instead of grabbing the bargains, as he burst through the doors, he leapt in, gleefully spreading local government grant funding around like confetti.

Dept of Communities and Local Government – Budget £25.92bn – Minister Eric Pickles

Battlegrounds Local authority budgets will bear the brunt of savings. The Local Government Association warns that children’s centres, museums, roads and bus fares will suffer cuts in the range of 10 per cent to the money local authorities get from Whitehall. Louise Casey, head of the Troubled Families Unit, is said to be behind moves to “take over” billions of pounds of spending from other departments.

Outcome – No deal yet. – Verdict Defeat

Crisis leads to council tax referendum call

Copied from Local Government Chronicle online
30 May, 2013 | By Mark Smulian

Herefordshire Council could become the first to hold a council tax increase referendum after an emergency meeting over a budget crisis.

This followed a review by incoming chief executive Alastair Neill, which found the budget set only in February contained errors and weaknesses.

It must now save an extra £8.4m this year and make 290 job cuts, against some 120 originally intended.

The council has saved some £21.1m over the last two years, and must save a further £32.2m over this year and the next two.

Mr Neill’s review found areas in the February budget “where the plans were not sufficiently resilient and [where] additional savings need to be made to ensure that the council delivers its plan within its budget”.

This included £1m of procurement savings which had “slipped and needed to be tackled” and £3.8m of learning disabilities grant which had in effect been counted twice.

Tony Johnson (Con), the council’s new leader, said: “We are facing a very challenging time over the next few years and as such we need to consider alternative approaches to delivering some of our services.

“Inevitably, non-mandatory services must bear the brunt of the cuts and although this will unfortunately involve job losses, it does not automatically mean the loss of services.”

The extraordinary council meeting agreed that the cabinet would consider holding a referendum to increase the 2014-15 council tax above whatever cap level is imposed.

Some 25% of Herefordshire’s income comes from council tax, which it had frozen from 2011-13. It increased it this year by 1.9%, equivalent to £1.5m.

Cllr Johnson said: “We must consider the possibility of raising council tax responsibly and proportionately across the county, as we begin to consider next year’s budget.”

Before doing so, he wanted to gauge whether residents “would be prepared to vote in favour of raising taxes to protect the county’s vital services”.

The coalition dropped Labour’s council tax cap, but substituted a system where tax could be raised above a nationally defined level only following a local referendum.

No council has yet held such a referendum, fearing both the cost and the likely outcome. In Herefordshire’s case a referendum would cost £100,000 to conduct.

In a joint statement with Unison, Herefordshire said it had agreed to reduce from three to two the number of days of unpaid leave to be taken during the Christmas period and to increase redundancy terms from the statutory minimum to 1.5 times that level.

Unison would prefer to keep in-house provision but will engage “fully in consideration of alternative business models that may be required in areas of service, where the council has to reduce or withdraw funding”.

Court to rule on council tax support schemes

Copied from LGC online
4 February, 2013 | By Mark Smulian

One has to ask if this ‘Knight In Shining Dog Collar’, isn’t picking a fight with the wrong level of government? Local government is being forced in to this position by central government. Based on the principle that everybody must pay something, government has placed the onerous task of deciding how to divvy up the council tax support budget, whilst cutting that budget by 10%.

This legal action is simply going to give the council involved an even larger hole in their budgets, unless they are able to claim back their costs from the other party. One has to ask if the complainants will put the same amount of effort in to helping these councils determine where to find the money required to fill the financial shortfall that loosing this case would create.

Two local authorities will be forced to defend their council tax support schemes in the High Court this week in the first of a string of legal-aid funded challenges by law firm Irwin Mitchell.

The first case against Haringey LBC is due to heard on Tuesday with a challenge to Sheffield City Council’s scheme due to begin on Friday. Irwin Mitchell say it has cases against Birmingham City Council, Hackney LBC and Rochdale MBC in the pipeline and warned it was “investigating several further councils”.

Sheffield cabinet member for finance and resources Bryan Lodge (Lab) said: “We will defend any proceedings because we simply have no choice but to make changes to our benefits system when we have had to make a cumulative savings of £180m over three years”.

A Haringey spokesperson said: “We took on board the views of residents, which is why those households that include claimants in receipt of certain benefits recognising significant disability have been shielded from the change.”

The string of legal challenges appear to have been initiated by Haringey residents who were put in contact with Irwin Mitchell lawyers by Paul Nicolson, a vicar who chairs the Zacchaeus 2000 Trust anti-poverty charity and Taxpayers Against Poverty, a campaigning organisation he founded last year.

He said: “I remember the poll tax in the 1990s and this is going to be worse. Taken with changes in unemployment benefits and housing benefit there will be a devastating affect on many people.”

Rev Nicolson said ministers had left local authorities too little time to devise acceptable support schemes, as defining financial hardship “requires detailed thought and there was just not enough time allowed for council to do this”.

Council tax support will be localised in April, when councils can set their own rules on who receives it but with a 10% cut in the overall budget.

Many claimants face being asked to pay council tax for the first time.

Local authorities can claim transitional relief if they limit increases for those who previously paid nothing to 8.5% of the tax level, but this is only available for one year.

A Birmingham City Council spokesperson said: “The council believes that the scheme is fair and lawful and will strongly defend any legal proceedings.”

He added that Birmingham thought its schemes differed sufficiently from others that “a finding against another authority would be binding on Birmingham”.

It rejected transitional relief because it would only defer the support scheme for a year and that “may not truly promote positive work incentives or support people back into work”.

Pickles defends his tough love approach

If it wasn’t so bloody infuriating to read such utter b******ks from this blustering windbag, it would be comical. Promoting his vindictive and spiteful sound bites as ‘tough love’, hopefully will attract the ridicule it deserves from all corners of local government. Disappointingly, the editorial page of the Daily Telegraph will be falling over itself, in the next day or two, to praise this latest guff.

Copied from Local Government Chronicle online
4 February, 2013 | By Ruth Keeling

Communities secretary Eric Pickles has professed his “love” for local government, praised it for doing a better job at cutting the deficit than the rest of government.

The declaration came after a tumultuous few weeks during which more than 30 Conservative council leaders wrote a joint letter of complaint to the prime minister warning of a “fractious relationship” with ministers.

Speaking at the New Local Government Network’s annual conference, Mr Pickles declared: “I love local government.

“Sometimes I do take liberties in trying to push you on…but it is on the basis of a loving relationship. I just want you to do a little bit better.

“I am there cheering you on, I want you to do better and you can do better.”

He added: “Local government has been absolutely outstanding in dealing with the deficit. If other bits of government had shown your resolve we would be in a better position.”

Mr Pickles was responding to a question from Peter John (Lab), leader of Southwark LBC, questioning the mixed messages from ministers about the role of councillors.

“Two years ago you were questioning the need for a chief executive, but then two weeks ago [former housing minister] Grant Shapps said we were the equivalent of scout leaders. Are we volunteers or proto-chief executives?”

Cllr John was referring to a BBC interview during which Mr Shapps argued that an increase in councillor allowances in recognition of their time and career sacrifice would be inappropriate as they were “volunteers”.

Mr Shapps’ comments has sparked an angry response from councillors, especially as they came shortly after local government minister Brandon Lewis had called for councillors to be barred from the Local Government Pension Scheme. Mr Lewis has also argues they were “volunteers” but not “professional, full-time politicians”.

Mr Pickles’ protestations of love for local government were dismissed by shadow communities secretary Hilary Benn whose speech to the conference came immediately after Pickles’.

“It is no good asking local government to take on this challenge [of falling funding and rising service demand] if at the same time the people expected to take on the challenge are criticised, patronised and belittled.

Prepare for ‘widespread financial failure’, ministers warned

Copied from Local Government chronicle online
30 January, 2013 | By Ruth Keeling

The government must establish mechanisms for dealing with “widespread financial failure” in local authorities, the National Audit Office has warned in its first assessment of the sector’s financial robustness.

A report by the watchdog said Whitehall was failing to understand the combined effects of its policy reforms on councils’ finances. Despite councils having “generally coped well” with the significant cuts made to their budgets, the NAO’s head Amyas Morse warned that councils would struggle to absorb further cuts over the next two years without reducing services.

“The [Department for Communities & Local Government] will need to be able to detect emerging problems and respond flexibly and quickly,” Mr Morse said.

Margaret Hodge, the Labour chair of the public accounts committee, went further, describing herself as “alarmed” by details in the NAO report and describing the lack of transparency over the scale of the cuts ministers had made to council budgets as “extraordinary”.

“The department needs to make clear what it will do if multiple authorities fail financially,” she said.

DCLG ministers and officials will be expected to appear before the committee’s MPs to answer questions on how they have assessed risks and intend to monitor for failure.

“My committee will expect the department to provide us with a clear statement on the financial impact of the government’s changes to authorities’ funding and what this might mean for local services,” Ms Hodge added.

The NAO report details several significant funding and policy changes that have heightened risk and uncertainty for local government.

And in a key finding, it claimed some Whitehall departments had failed to provide DCLG with costed estimates of the effects of their policies on councils.

The watchdog’s researchers discovered that the Department for Education’s 2010 spending review submission failed to include an estimate of aggregate cost pressures or possible cost savings across children’s services.

This omission resulted in DCLG assuming cost pressures on children’s services would be no greater than inflation over the spending review period.

The NAO also discovered that Whitehall departments lacked data on how policy reforms would hit different regions.

Research by the Association of Directors of Children’s Services last year revealed that demand for services had not only gone up – meaning service costs outstripped inflation – but also that geographical cost variations ranged from -30% to +100%.

LGA chair Sir Merrick Cockell said: “It is concerning that the departments examined by the NAO had not fully scoped the demand for and cost of delivering services to different areas and that not enough effort was made across Whitehall to assess what savings were possible before cuts would start eating into frontline services.”

Speaking as the government embarks on a new spending review, Sir Merrick called for assessments of cumulative impact of changes to become “a basic feature” of future government decisions.

DCLG did not respond to the specific recommendation of the NAO report but said: “Every bit of the public sector needs to do its bit to tackle the deficit left by the last administration, including local government which accounts for a quarter of all public spending. Councils need to do their bit to deliver sensible savings, and in turn, protect frontline services and keep council tax down.

“Our broader local finance reforms will reward councils which promote local jobs and enterprise, driving economic growth and making councils less dependent on Whitehall handouts.”

A Department for Education spokesperson said: “Local authorities know best how to meet the specific needs of their communities. That is why we have removed ring-fencing from a number of grants so that local authorities have more freedom to spend their resources where they are needed most – on disadvantaged children and families.

“We are working with local authorities to consider the possibility for efficiencies in major spending areas.”

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Threat of revolt wins Tory shires more money

Copied from Sunday Telegraph 20 Jan 2013
By Patrick Hennessy, Political Editor

MINISTERS have backed down and promised more money after a revolt by shire Tories against “grossly unfair” cuts in local government spending.
A group of about 120 councils, mostly Conservative-controlled, warned Eric Pickles, the Communities Secretary, that reductions in spending announced last month would “crucify” rural communities.
The group was considering bringing a judicial review against Mr Pickles’s settlement, which it said would see “predominantly rural” councils receive 3.81 per cent less from central government compared with cuts of 2.05 per cent for urban councils.
Andrew Lansley, the Commons Leader, has signalled that a “correction” will be applied to next year’s spending figures.
Mr Lansley said the difference between spending on urban and rural councils was a “matter of concern”.