Local government settlement shows Government is not in listening mode

By Ian Miller | 09 February 2021

The final local government settlement brought no cheer. The Government didn’t listen to the representations that councils, including districts, submitted. New homes bonus allocations for 2021-22 will be based on housing growth in the 12 months to October 2020, using a 0.4% pre-COVID threshold. No account was taken of the impact of COVID on building during half of that period.

A higher threshold for the Mayor of London apart, there was no shift in proposals for criteria for ‘excessive’ council tax increases. The Government presented no compelling reason why the maximum increase for districts should be 2% or £5, a figure that has applied for several years and has not been adjusted to allow for erosion in the value of money. Nor a reason why, in comparison, police and crime commissioners should be allowed to increase by up to £15. In many shires, police council tax has leap-frogged the district share. For councils, the consultation seems a sham. The decisions were taken long ago by the Treasury. The Spending Review on 25 November said ‘the referendum threshold for increases in council tax will remain at 2% in 2021-22’ ignoring the statutory requirement to consult and the process for the House of Commons to approve the referendum principles.

The Ministry didn’t listen to representations about the name of the new ‘lower tier services grant’. Districts are grateful for it (as are unitary councils who also benefit). It reinforces the Whitehall preoccupation with using unnecessarily hierarchical language. What would have been wrong with community services grant or local services grant?

The ‘request’ for billing authorities not to send out business rates bills because of the Budget on 3 March gives the game away: there will be more reliefs, decided centrally. Billing in many councils would otherwise have been under way by then. If the approach devised by the Government requires software changes, there is a severe risk that getting out bills in time for instalments on 1 April will be jeopardised.

As always, Whitehall knows best.

Ian Miller is chief executive of Wyre Forest DC


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