Budget 2020

Based on feedback from councils, the LGA’s Budget submission focuses on getting the right funding to improve services and people’s lives through public service reform.

The upcoming Budget will be the Government’s first after the General Election and since the UK left the European Union. It provides an opportunity to ensure councils play a key role in kickstarting the delivery of national domestic priorities and reforms.

High-quality services, maximising the growth potential of their local areas, and supporting national priorities, such as providing new housing, are what councils are ambitious about achieving. What is needed to help do this are the appropriate powers and funding from government, alongside decisions about long-term reform and investment.

This includes long-term investment to allow councils to play a key role in fixing the nation’s roads, tackling environmental challenges, delivering high-speed broadband and extending high-quality mobile connectivity to all parts of the country.

The LGA’s Budget submission also calls for reform of Right to Buy, investment in technology to reshape services, and more opportunities for councils to borrow for housing and infrastructure projects at favourable rates.

After the UK’s exit from the European Union, it is vital that the Budget signals the start of the consultation process for the UK Shared Prosperity Fund – the intended successor scheme to EU funding. This will help councils and their partners boost local growth.

Devolution can support national ambitions to improve local public services by bringing the decisions that matter closer to local people and helping councils to build sustainable and inclusive local economies.

The repatriation of powers from Brussels must not stop with Whitehall, and the LGA’s submission contains proposals for empowering local areas in England. The Budget should be used to add more detail to the Government’s plans on devolution, announced in the Queen’s Speech.

Certainty over funding is crucial for councils to set new long-term strategies, to make the most of taxpayers’ money. The Government should work with councils on their financial planning by setting out the direction of travel for 75 per cent business rates retention, together with its review of relative needs and resources.

The business rates review is also an opportunity to give councils more power over local taxes, simplify the appeals process, and tackle business rates avoidance.

The additional funding announced for 2020/21 in last year’s one-year Spending Round is helpful, but councils continue to face significant pressure. Local government has lost nearly £15 billion of core government funding over the past decade, and nearly a quarter of staff since 2012.

The Spending Review later this year must also provide sufficient funding and certainty for councils in the long term, including a sustainable solution for funding adult social care. Ambitious investment and public service reform must be built on a stable financial foundation.

Local government finance reform

In the 2019 Spending Round, the Government announced a one-year delay to the introduction of 75 per cent business rates retention and its review of the Fair Funding Review. This gave certainty to councils planning their budgets for 2020/21, but there has been little chance for work to progress since autumn.

LGA view: The Government must publish a timetable for the coming year, setting out dates for further consultations and timings of when key decisions on the reforms will be made. The Fair Funding Review results should be introduced with additional funding and appropriate transition mechanisms, to ensure no local authority’s funding is reduced.

House building

Council house building and reforming Right to Buy are both critical to boosting the supply of new homes, providing good-quality homes to rent, reducing homelessness, and tackling councils’ housing waiting lists.

LGA view: Councils must be able to retain 100 per cent of Right to Buy receipts and be given the flexibility to set discounts locally to invest in new and existing stock.

Local roads

The number of miles travelled on council roads each year increased by 3.3 per cent between 2009 and 2017. During the same period, expenditure on highways and road maintenance fell by 32 per cent.

LGA view: With a £9.8 billion backlog of repairs on local roads, reinvesting 2p of existing fuel duty, worth around £1 billion a year, in local roads would make serious progress on the pothole backlog, and support government ambitions for the national transport network.

Children’s social care

Over the past decade, there has been a 139 per cent increase in serious cases where the local authority believes a child may be suffering, with cases up by 117,070 to 201,170.

LGA view: Councils need long-term sustainable funding and solutions to deal with unprecedented demand for child protection services.

Climate change

Our research into 100 councils’ activities found more than 182 projects related to tackling climate change, including the installation of vehicle charging points, waste prevention schemes, and long-term investment in renewable energy projects.

LGA view: To speed up and scale up the work of councils, we are calling for a joint local and central government task force on climate change that reaches across government.

Broadband

Local government has been a key player in the rollout of improved broadband connectivity to the hardest-to-reach areas over the past five years. The announcement of a Shared Rural Network is positive, but the measure of coverage used to judge the success of the network should match consumer experience on the ground.

LGA view: The Government must use the National Infrastructure Strategy to consider how public funding could help address the significant mobile connectivity digital divide and ensure all communities have high-quality 4G connectivity as a minimum.

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