Dan Peters 05 October 2020

Fragmented council funding risks to value for money, report warns

The increasing fragmentation in council funding ‘undermines central government’s understanding of service delivery’ and ‘risks impeding value for money,’ a report has warned.

Research for the Local Government Association (LGA) found at least 448 unique grants were issued to the sector between 2015/16 and 2018/19, with more than 50 worth less than £1m – less than 0.25% of the budget for a typical metropolitan district or London borough.

The increasing number of grants comes as the total amount of grant funding from central government decreases – falling by 16% from £83.1bn in 2015/16 to £69.9bn in 2018/19.

Researchers TRL Insight also found almost a third of grants were competitive - which the LGA said placed ‘additional stress on an over-stretched system’ - and more than a third were discontinued from one year to the next.

The report read: ‘The fragmentation in local government funding undermines central government’s understanding of service delivery as a whole.

‘The largely short-term basis for local authority grants has undermined the ability of councils to plan strategically for the long-term.

'It limits time for commissioning, and risks harming the quality and value for money of the service by forcing councils to develop strategies for closing down services in the event that funding is discontinued.’

The report went on: ‘Overall, the increasing fragmentation in local government funding risks impeding value for money – both from the administrative burden it poses on councils and from the detrimental impact on the outcomes that could be achieved for communities.

‘A trend towards targeted funding has reduced the ability of councils to flexibly deliver local priorities for local people, and has not led to effective oversight or control of the delivery of central government’s priorities.’

The LGA’s submission to the Spending Review published last week called for an end to the fragmentation of funding.

A Ministry of Housing, Communities and Local Government spokeswoman said: ‘It is right the majority of council funding is not ring-fenced to enable councils to focus on local priorities and manage their finances effectively but it is sometimes appropriate to provide targeted funding for specific purposes.

'The Spending Review is our opportunity to look at funding for local government in the round.’

SIGN UP
For your free daily news bulletin
Highways jobs

Independent Travel Trainer

Oxfordshire County Council
£41,771 - £45,091
About Us At Oxfordshire County Council (OCC), our Supported Travel Service plays a vital role in keeping communities across the county connected, independent and involved. Every day, a dedicated team of around 200 staff members supports the journeys and t Oxford
Recuriter: Oxfordshire County Council

Contract & Compliance Manager

Oxfordshire County Council
£63,576 - £67,003
About Us At Oxfordshire County Council (OCC), our Supported Travel Service plays a vital role in keeping communities across the county connected, independent and involved. Every day, a dedicated team of around 200 staff members supports the journeys and t Oxford
Recuriter: Oxfordshire County Council

Procurement Manager

West Northamptonshire Council
£49587 - £52860
At West Northamptonshire Council, we are currently looking for two experienced procurement professionals to join and support both our People and Resources and Place and Capital Business Partner teams. As procurement managers you will play a central role Northampton
Recuriter: West Northamptonshire Council

Technical Assistant - Place Services

Essex County Council
Up to £25081.00 per annum + + 26 Days Leave & Local Gov Pension
Technical Assistant - Place ServicesPermanent, Full Time£25,081 per annumLocation
Recuriter: Essex County Council

Senior Project Manager (Major Projects)

Calderdale Metropolitan Borough Council
£49,282 - £52,413
Are you a Senior Project Manager with significant experience in delivering highway and infrastructure projects? Calderdale, West Yorkshire
Recuriter: Calderdale Metropolitan Borough Council
Linkedin Banner