Liverpool welcomes proposed reform of local government finance
Liverpool City Council has welcomed draft proposals by the Government to reform local government finance.
The Ministry for Housing, Communities and Local Government (MHCLG) has published its second consultation in relation to the Fair Funding Review.
It requests views on a number of themes, including:
- How new funding allocations are determined
- Consolidating funding
- A long-term approach to Business Rates retention
- Reducing demands to empower councils to deliver for their communities
Deputy Council Leader and Cabinet Member for Finance, Resources and Transformation, Cllr Ruth Bennett, said: “It is widely recognised among the local government sector that reform of the way in which councils are financed is long overdue. The funding formula has not changed for decades, and does not take into account local demands on services, particularly in northern towns and cities, including Liverpool.
“We welcome the proposals to simplify the overcomplicated grant funding system, and to give us certainty through multi-year settlements which allows us to plan for the medium term.
“Equalising Council Tax is a much needed, important exercise, particularly in areas such as Liverpool in which the vast majority of properties are smaller and in Bands A and B, meaning they bring in far less revenue than places with lots of larger homes in higher bands.
“We also welcome the proposal to reset the Business Rates system in order to restore the balance between rewarding business rates growth and aligning funding with need.
“These are all important steps in re-distribution, as is the recognition in the consultation that deprivation is a major driver in the cost of delivering local services, particularly in places such as Liverpool with high levels of demand for adult and children’s social care.
“The acknowledgement from the Government that difficult decisions need to be taken is welcome, as is the commitment to using ‘the best available evidence’ to drive decision making, and target spending. For too long council funding has been reliant on out of date information on the relative levels of need and available resources which has had a detrimental impact on Liverpool and many other under-funded authorities.
“We will be providing a more detailed response to the consultation in due course.”
More information about the consultation, which is open until 15 August can be found at https://www.gov.uk/government/consultations/the-fair-funding-review-20.