Agenda item

Nicola Morton, Head of Local Government Finance, introduced the report, which set out the key points of the Government’s technical consultation on the 2018/19 local government finance settlement for Members’ comment.

It was noted that the consultation had been published the previous week, and confirmed the intention to continue with the four-year funding deal announced in December 2015. On the New Homes Bonus (NHB), the Government had proposed not to pay the NHB on properties which had been granted permission on appeal. A calculation would be made which took into account the number of homes which had gone through on appeal and this would potentially be used to decrease the NHB allocation. On this, and other matters included in the consultation such as councils tax precepts for Mayoral Combined Authorities and business rates revaluation, officers would include the LGA’s existing lines, but any additional comments could be included in the response before the submission deadline of 26 October 2017.

In the discussion which followed the following comments were made by Members:

·         The NHB was very important to councils as part of the wider housing finance discussion, and lifting the borrowing cap would also help local authorities to build more homes. The policy objective of the NHB was to incentivise growth, and therefore changes should not be counterproductive to this to make sure there were no unintended consequences.

·         The LGA should be clear in the response that if RSG is taken away there should be a move towards greater business rate retention to meet the funding gap.

·         Regarding Mayoral Combined Authorities, it was confirmed that it would be for individual Mayors to decide what any council tax precept they raised would be spent on when this power was introduced from 2018/19. This would also depend on what functions they had.

·         Concern was raised that authorities who borrowed capital to build schools would then lose this money if the schools transferred to academies. The local authority would only have responsibility for SEN, home to school transport, and failing schools.

Decision

The Resources Board noted the consultation document and agreed that their comments would inform the LGA’s response, which would be signed off by Lead Members of the Board.

Action

Draft consultation response to be cleared by Lead Members of the Board.