27th November 2015
Reflections on the Chancellor’s Spending Review and what it means for us
Up and down the country, top teams will be trying to assimilate the impact of the Chancellor’s Spending Review (CSR) which, combined with the Autumn Statement this year, sets out Government’s spending over this parliament.
Teams across the country will be trying to provide relevant briefings for their members eager to understand the local impacts of Wednesday’s announcements and what they mean for the future of the sector.
The devil is always in the detail and that inevitably feeds through sometime after the key headlines. The landscape, however, needs careful analysis, as in a world where many authorities have agreed or are in dialogue over combined authorities, CSR needs to be seen in the context of those confirmed or emerging arrangements, as well as the existing partnerships locally.
The impact CSR has on key partners working across LEPs, health, police, fire, probation and in the third and business sectors will be as critical to evaluate. Those agreements on integration and sharing will need to be evaluated in the light of some unexpected funding changes in the health economy for example.
What is clear is that Local Government continues to bear its share of public sector constraint. However, there are some interesting dynamics emerging.
The intersection of the grant funding system and business rates means that the government commitment to business rate localisation can be delivered. The issues of redistribution I’ll set aside for another time.
The potential council tax increase for social care at least explicitly recognises the structural significance of a maturing population and the material fiscal demands that entails irrespective of whether that covers the pressures locally. This is an important and strategic matter which helps raises the profile of this issue which affects all major economies.
The issue of whether council tax rises will be acceptable locally remains.
There is an opportunity, too, for some authorities to consider how to sustain their funding locally into the medium term and begin the strategic analysis of how their income streams of business rates, council tax, and other revenues will meet and underpin their community priorities.
On the two themes of national infrastructure investment and the need for continued public sector reform, these two matters sit at a partnership or combined authority footprint level. Therefore, CSR detail will need to be understood not just within each local authority but across all its confirmed or emerging partnership arrangements. Ideally, better news for one public partner could ultimately be better news for all.
By Mike Suarez, Chief Executive, Cheshire East Council and Solace Deputy Spokesperson on Local Government Finance