Source · Select Committees · Public Accounts Committee
Recommendation 4
4
Accepted
Update on funding simplification progress, pilot results, and report costs and benefits bi-annually.
Conclusion
We welcome the intentions to simplify the funding system, but the Department has more to do to implement its plans. The Department published its plans for funding simplification in Summer 2023. This plan covers the whole of government and aims to simplify the approach to, and number of, funding streams available to local authorities. The plan includes, giving local authorities more flexibility in managing their projects and reducing the burden of data collection on local authorities. Currently, the Department collects over 400 indicators across 13 funds but recognises this is too much. It has established what it calls ‘pathfinder 8 Levelling up funding to local government simplification pilots’ that allow ten local authorities who are receiving money from multiple funds to pool these funds so they can manage their individual projects as one. However, it is yet to draw any conclusions from this initiative. Recommendation 4: In its Treasury Minute response, the Department should update us on the progress with simplification including its work with other government departments and progress with the ten simplification pilots. In the future, it should update the Committee by letter once every six months of further developments in this regard, along with the costs and benefits (both to the Department and local authorities) arising from greater simplification.
Government Response Summary
The government agrees, confirming the Funding Simplification Doctrine is published and in force, with an interim evaluation of the pilots due by year-end and a full evaluation in 2026. It describes improvements to fund management, but will not quantify costs and benefits due to disproportionate burden, nor explicitly commit to six-monthly updates by letter.
Government Response
Accepted
HM Government
Accepted
The government agrees with the Committee’s recommendation. agreed and Funding Simplification Doctrine published. An interim evaluation of the pilot will be available before the end of the year, with a full evaluation published in 2026. The Funding Simplification Doctrine came into force earlier in 2024. Prior to this, the department had intensive engagement with other departments that regularly award funding to local authorities, notably the Department for Energy Security and Net Zero, Department for Transport, and the Department for Environment, Food & Rural Affairs. Officials from across government have engaged actively with the development and implementation of the Doctrine. DLUHC will use the returns from departments alongside feedback from participating teams to monitor its implementation and impact. The department continues to improve its current suite of funds, for example speeding up decision making required for a Project Adjustment Request through allowing S151 Officers (local authority Chief Financial Officers) to verify that projects remain good value for money, rather than requiring checks by analysts in the department. The department has not sought to quantify the costs and benefits to government or to local authorities that arise from these measures. Doing so would establish a disproportionate burden on councils and arguably fall foul of the principles set out above. The department will publish the evaluation reports for the pathfinder pilot when available.