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

Finance Officer - 12 month Fixed Term Contract

Essex County Council
£25081.00 - £27653.00 per annum + + 26 Days Leave & Local Gov Pension
Finance OfficerFixed Term, Full Time£25,081 to £27,653 per annumLocation
Recuriter: Essex County Council

Principal Highway Engineer – Highway Condition Specialist

W.D.M. Limited
£65,000 - £80,000 based on experience
We are looking for a driven and experienced Professional Civil Engineer with a strong background in highways engineering to join our team. Bristol
Recuriter: W.D.M. Limited

Deputy Head of Pensions

London Borough of Richmond upon Thames and London Borough of Wandsworth
£48,873 - £62,451 dependents on experience
The Pensions Finance team has a variety of work shared in a small team giving the opportunity to get involved in every area. The team provides financial and investment support to Wandsworth Council’s £3bn pension fund, the Southwest Middlesex Cremato Wandsworth, London
Recuriter: London Borough of Richmond upon Thames and London Borough of Wandsworth

Adults Social Worker - Forensic Mental Health

Essex County Council
£37185 - £50081 per annum + Flexible Working
This position is open to Newly Qualified Social Worker's (NQSW) with relevant experience in Mental Health. The starting salary for NQSW's is £34,902 England, Essex, Wickford
Recuriter: Essex County Council

Policy and Procedure Coordinator

Durham County Council
Grade 9 - £35,412 - £39,152
Policy and procedure coordinator 18.5 hours ( working pattern to be agreed)   Are you a qualified Social Worker with experience of working with childr Spennymoor
Recuriter: Durham County Council
Linkedin Banner