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Select Committee · Public Accounts Committee

Financial sustainability of local authorities

Status: Closed Opened: 15 Oct 2014 Closed: 26 Mar 2015 1 report
Inquiry scopeThe Government sets statutory duties for local authorities to provide a range of services, ranging from adult social care to waste collection. To remain financially sustainable, local authorities must be able meet their statutory service obligations. This is becoming more challenging in the current financial context. Over this Parliament, government funding to local authorities has fallen in real terms by 27.9%. Once council tax is taken into account, this equates to a reduction in overall local authority income (defined as “spending power”) of 19.2% in real terms. Those local authorities that are more dependent on government grants have experienced the biggest reductions in income. These local authorities have been less able to protect spending on statutory services such as children’s and adult social care. Meanwhile, while changes such as the localisation of business rates mean that local authorities have more opportunities to raise their own income, these developments also create potential uncertainties over future funding for local authorities. The changes will affect local authorities differently depending on their local circumstances, their ability to act on the opportunities to raise income, and to manage successfully funding uncertainty. This inquiry will look at the impact of funding decisions on services, strategies for coping with further reductions and whether local authorities would be able to maintain current statutory duties in the event of further funding reductions.

Reports

1 report

Oral evidence sessions

1 session

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Date Session and witnesses Source
26 Nov 2014 No witnesses recorded View ↗