Agenda item

The Independent Commission on Local Government Finance published its final report “Financing English Devolution” on 18 February 2015, which provided a summary of the Commission’s conclusions and recommendations.

Eamon Lally presented the report to the Board and stated that it represented a wholesale reform of the local government finance system and local public spending. The report suggested a move towards fiscal devolution of existing taxes and new taxes such as a tourism tax. The report set out proposals for achieving greater self-sufficiency across the local government sector and for the sector itself to take on a greater role in equalising resources at a sub-national level.

Board members raised the following points in the discussion that followed:

·         If we are to depend on the Government for funding local authorities, we need multi-year settlements.

·         Equalisation as referred to by the Finance Commission is a key point, which needs close examination.

·         Local authorities need fiscal independence that would come from beyond just the retention of business rates.

·         The levels of Social Care funding needed to be addressed.

·         The Government remained cautious on devolution and one area for financial devolution which would be welcomed was in relation to health. Public health commissioning had improved since being taken over by Councils from the NHS. If Councils could take control of other elements of the NHS budget so much more could be achieved.

Decision

The Board agreed:

·         The recommendations of the Independent Commission on Local Government Finance in the context of the Executive’s broader work on devolution in England; and

·         How the Local Government Association can promote the Commission’s recommendations with member authorities, MP’s, civil servants and other stakeholders, as it seeks to influence the policies of the next Government; and

·         To request that the Chief Executive submit a future paper which addresses how equalisation as proposed by the Commission could work in practice.