Source · Select Committees · Public Accounts Committee
Recommendation 11
11
Accepted
Competitive bidding for Levelling Up Funds creates burdensome 'begging bowl' culture for councils.
Recommendation
Evidence we received from the South East Councils told us that the bidding process for funds had led to a ‘begging bowl’ culture where Councils were required to spend too much time and money to meet ever-changing demands of ministers, rather than planning for the long-term to truly deliver for their communities.26 The Local Government Association 16 Qq 29, 30 17 Q 9 18 Q 43 19 Q 13 20 Qq 34, 36 21 Correspondence from Permanent Secretary, Department for Levelling Up, Housing and Communities, dated 29 January 2024 22 Q 16 23 Qq 120, 121 24 Q 121 25 Qq 15, 59, 78 26 Q 101, LFG0002 Levelling up funding to local government 13 (LGA) estimated the average cost to councils of pursuing each competitive grant to be in the region of £30,000 (with each local authority spending roughly £2.25 million a year chasing down various pots of money distributed from across Whitehall).27
Government Response Summary
The government accepts the recommendation, stating it is moving to a simpler, more streamlined funding system. It has implemented a Funding Simplification Doctrine with four principles for new funding to local government and moved away from competition for Levelling Up Fund Round 3.
Government Response
Accepted
HM Government
Accepted
The department has reflected on lessons learned through the simplification pathfinder pilot and stakeholder feedback regarding the burden on local authorities. It is moving to a funding system which has a simpler and more streamlined landscape, increased flexibility for local authorities and partners and longer-term funding settlements. The department is putting this plan into action. For example, it has taken a new approach to the third round of the Levelling Up Fund, moving away from competition and making use of the large number of high-quality bids submitted in Round 2. This reduces burdens and maximises efficiency. The government agrees with the Committee’s recommendation. Recommendation implemented 3.2 The Funding Simplification Doctrine that came into force at the start of 2024 covers all new funding to local government and consists of four principles: • departments should consider whether creating a new fund is necessary or whether funding could instead be channelled through existing structures; • departments should consider their choice of distribution methodology and consider allocating funding, as opposed to defaulting to competition; • the delivery model of a new fund should be tested with local authorities, the Local Government Association, or equivalent bodies in Scotland, Wales, and Northern Ireland. • departments should demonstrate that they have minimised the data and reporting burden created by the new fund, whilst not compromising the evidence they collect to monitor value for money. 3.3 The department has incorporated the Doctrine into its policy design and decision-making process and has shifted away from a competition by default approach.