Agenda item

A report on the 8 July Budget will be circulated on a supplemental agenda as part of this item.

Stephen Hughes (Executive Director) introduced the report which updated on recent local government finance policy developments.  In particular, he summarised the key issues in the Chancellor’s Emergency Budget on 8 July with implications for local government and projected the funding position for councils as a result of the changes through the LGA’s Future Funding Outlook.

In the discussion that followed, Members made a number of questions and comments, including:

·        Lobbying for greater freedoms and flexibilities to enable councils to build more homes was highlighted as a key priority, with particular reference to the impact raising the Housing Revenue Account borrowing cap would have on existing and future infrastructure schemes.

·        The Board reiterated the importance of continuing to lobby for councils to retain 100 per cent of Right to Buy receipts to support new housing.

·        The Government’s Business Rates Reform consultation was highlighted as an opportunity push for full devolution of business rates to enable local authorities to set rates and exemptions locally.  

·        In discussing the implications of the National Minimum Wage, serious concerns were raised regarding the upward pressure on council budgets and contract costs – particularly in relation to care – and emphasised the importance that Government be made aware of the extent of the new burdens.

·        Long term financial certainty, particularly in relation to future income sources, was highlighted as vital to enabling councils to plan for future demands.  Members highlighted the need to define the sector’s asks and preferred delivery mechanisms to provide this certainty.

·        Proportionally sharing the financial and efficiency savings from adult social care and health integration between health and local authority partners was highlighted as a key challenge. 

·        With reference to the interconnectivity of neighbouring authorities, a Member highlighted the need for a holistic approach to facilitate cross working and avoid transferring challenges between local authorities.

·     Concerns were expressed regarding the financial and administrative burden on councils as a result of the differential rate “Pay to Stay” proposal for social housing tenants with household incomes above specified limits.

Cllr Sue Murphy (Lead Member for EU Funding) and Russell Reefer (Advisor) provided a verbal update on the latest regarding the 2014-2020 EU funding programme.  In doing so, they drew attention to an announcement in the budget relating to Cornwall being granted Intermediary Body (IB) status and confirm that the LGA would push for IB status to be available to more areas.

·        Whilst Members welcomed the shift in the Government’s position, serious concerns were expressed regarding a lack of engagement in certain local areas between LEPs and local authorities. 

·        With reference to a lack of clarity from Government, Members emphasised the importance that there be a requirement in the Terms of Reference for European Structural Investment (ESIF) Committee to include more than one locally elected representative.

Decision

The Resources Board noted the report and agreed its comments inform the development of the work programme.

Action

Reflect the Board’s comments in the work programme for 2015/16.