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

Assistant Director – Youth and Communities

Suffolk County Council
£88,225 - £105,726
This is early help in its truest sense, and we’re looking for a leader to shape this vision and make it a reality. Suffolk
Recuriter: Suffolk County Council

Rent Recovery Officer - Basildon Borough Council

Essex County Council
£17.6500 - £20.0000 per hour
Rent Recovery Officer - Basildon Borough Council Basildon, Essex £17.65 - £20.00 per hour PAYEFull-Time, Temporary - 36.25 hours per week Closing Date England, Essex, Basildon
Recuriter: Essex County Council

Director of Public Health & Wellbeing

Dudley Metropolitan Borough Council
£108,015 – £118,680 pa
Be the leader who delivers better health for every community in Dudley. Dudley, West Midlands
Recuriter: Dudley Metropolitan Borough Council

Social Worker Fostering

Durham County Council
Grade 9 - £35,412 - £39,152 (pre-progression) / Grade 11 - £40,777 - £45,091 (post-progression)
Do you believe every child deserves to grow up surrounded by love, family, and a sense of belonging?   We’re on an exciting journey to expand our Conn Seaham
Recuriter: Durham County Council

Social Worker

Durham County Council
£35,412 - £39,152 (pre-progression) / £40,777 - £45,091 (post-progression)
Do you want to support parents to achieve meaningful and sustainable change and help more children to remain safely within their birth families?   We Durham
Recuriter: Durham County Council
Linkedin Banner