Local Government Funding

Thank you for contacting me about funding for local government.

Local government is the front line of our country’s democracy, and local authorities deserve the resources they need to do their job in delivering truly world-class public services. That is why I welcomed the recent Local Government Finance Settlement, which provides two years of real terms increases in resources available to local authorities across England.

The recent settlement for the 2018-19 financial year is the third year of a four year offer which was accepted by 97 per cent of councils in return for publishing efficiency plans. For 2018-19, core spending power for local authorities across England will total £45.1 billion, up from £44.3 billion in 2017-18, which includes a rise of £2.4 million in core spending power for our own local authority of Calderdale. I welcome the fact that core spending power for English local authorities will increase again in the next financial year, up to £45.6 billion.

The latest settlement has again prevented local authorities from introducing excessive increases in council tax without first securing the backing of local residents in a referendum. Since being introduced in 2012, referendum principles have helped keep council tax down, with average council tax in England for the current 2018-19 financial year forecast to be 1.4 per cent lower in real terms than in 2010-11, measured against CPI. In our own local authority of Calderdale, average council tax is also forecast to be 1.4 per cent lower in real terms than in 2010-11.

I am pleased that the Government is currently conducting a fair funding review in order to set new baseline funding allocations for local authorities from 2020-21. A wide range of options for developing an updated funding formula are being considered, by examining the factors which drive up costs for local authorities.

I am also encouraged that the Government is committed to ensuring that all local authorities retain 75 per cent of their business rates from the 2020-21 financial year, granting councils the levers and incentives they need to grow their local economies.

Thank you again for taking the time to contact me.

Craig Whittaker MP

September 2018