19th December 2022
SOLACE STATEMENT ON LOCAL GOVERNMENT FINANCE SETTLEMENT
Patrick Melia, Solace spokesperson for local government finance, said: “While we’re aware officials have done all that they can to provide councils with as much detail as early as possible, the fact remains the local government finance settlement is, once again, only being published in full the week before Christmas – despite the fact the Government’s own advice cautions against such an approach.
“At a time when money has never been tighter due to huge inflationary cost pressures combined with rising demand from the cost of living crisis and the aftermath of the pandemic, this entirely avoidable delay in providing certainty increases financial risk and drives councils towards inefficient short-term focused decision-making. By narrowing the window over which investment decisions can be made, local authorities are hindered in their ability to plan and deliver both greater service efficiencies and capital spending decisions that would catalyse much-needed local growth.
“While providing some extra money is always welcome, this settlement still falls far short of what is required. As highlighted by the Institute for Fiscal Studies’ latest analysis, councils will remain under huge financial pressure and there are very few savings options left.
“All of which points to the inescapable truth that the local government finance system, in both its design and its delivery, is simply not fit for purpose. That is why Solace is calling for a Commission to review the way local government is financed, to not only look at the total quantum of funding available to councils alongside the regressive and ineffective taxation system that supports local government, but the length of the settlements and the timeframes in which the sector receives them.”