BS1033 Local Government – Continuity and Change

3. Local Authority finance

BS1033 Local Government – Continuity and Change3. Local Authority finance

Some figures: (1997)Revenue Capital

Education, libraries 33% 14%Housing 16% 38%Personal social services 15% 3% Fire,police,probation 13% 3%Environmental 7% 17% Transport 5% 18%

BS1033 Local Government – Continuity and Change3. Local Authority finance

Revenue Support Grant=

Needs Assessment (Standard Spending Assessment)

-

(Business rate x. local population

Council tax x local population)

BS1033 Local Government – Continuity and Change3. Local Authority finance

Sources of funds (Revenues)

Central Government

Business rates 18%

Revenue Support 26%

Grants 25%

Local Government

Council Tax 12%

Charges (rents), asset sales 18%

BS1033 Local Government – Continuity and Change3. Local Authority finance

Council Tax (and rates)

+ Cheap to administer, difficult to evade, cheap to collect

- Lump sum, annual rental value may be distorted, do not take into account ability to pay, some pay whilst ‘others’ benefit

BS1033 Local Government – Continuity and Change3. Local Authority finance

New Labour:

Abolition of crude and universal capping (but reserve powers)

Best Value (both quality and quantity)

Secure continuous improvement (efficiency, economy, effectiveness)

Private Finance Initiative (for schools in particular)

- Design Build Finance Operate

- Joint ventures)