Laura Sharman 26 October 2016

Research reveals winners and losers in council funding reforms

Funding reforms could affect the quality of council services across the country, with county and metropolitan councils likely to lose significant sums of money by 2020, new research has warned.

The Institute for Fiscal Studies found that allowing councils in England to retain 100% of business rates revenue will help boost the funding of 52 (mostly district) councils by 5% or more by 2017.

However, 119 councils will lose money under the scheme which could lead to ‘greater divergence in council service quality’.

The report found that poorer councils more reliant on grants have cut their spending by 33% on average, compared to 9% by richer councils.

‘The changes to local government finance in England during the 2010s will be truly revolutionary,’ said David Phillips, a senior research economist and an author of the report. ‘We will have moved from a system where equalisation and insurance was paramount, to one with much more emphasis on incentives for growth, but also more financial risk for councils.

‘Along the way there will be lots of tricky policy decisions. And there are big picture questions, such as whether these changes will actually empower councils to deliver more growth, or just burden them with additional revenue and spending risks. The IFS’s new programme will look at both types of issues, in an effort to ensure this revolution is subject to proper public scrutiny.’

The report also found that - excluding education spending - councils are planning to spend 22% less on service provision in 2016-17 than they did in 2009-10.

For an in-depth look at how plans to scrap government funding to local authorities and replace it with business rate revenue are fraught with problems, visit The MJ.

SIGN UP
For your free daily news bulletin
Highways jobs

Lead Social Worker WMF2939e

Westmorland and Furness Council
£47,181 to £48,226
We have an exciting opportunity for the role of Lead Social Worker in the Learning Disability, Transition and Autism Team Barrow in Furness, Cumbria
Recuriter: Westmorland and Furness Council

Streetworks Compliance Officer WMF2942e

Westmorland and Furness Council
£36,363.00 - £37,280.00
The Streetworks Compliance Officer role within the Highways Service plays a vital part in managing and overseeing streetworks Kendal, Cumbria
Recuriter: Westmorland and Furness Council

Family Hub Practitioner - WMF2923e

Westmorland and Furness Council
£32,061 - £32,597
An exciting opportunity has arisen for a Family Hub Practitioner in the Best Start Family Hubs Cumbria / Various
Recuriter: Westmorland and Furness Council

Support Officer

Durham County Council
Grade 4 £25,583 - £26,824 pro rata
We have an exciting opportunity for a part time temporary 24 month contract Support Officer to join our dedicated team within Business Services. WH Durham
Recuriter: Durham County Council

Class Teacher

Durham County Council
£37,101- £45,352
KS2 Class Teacher (Maternity Cover)  This is a maternity cover post and will continue until the substantive post holder returns. The successful candid Peterlee
Recuriter: Durham County Council
Linkedin Banner