The CLG Committee has today published independent analysis
suggesting ways in which the current needs and funding
assessments for councils could be made simpler and more
transparent.
The research is aimed at contributing to the Government’s Fair
Funding Review and the work implementing 100 per cent retention
of business rates for local authorities.
The analysis suggests a method for simplifying the needs
assessment formula – reducing the number of indicators used – and
for simplifying the wider funding model that translates these
assessed needs into funding. The research also reviews the data
that is used in the calculations.
It also assesses the implications of two potential models for the
ongoing ‘resetting’ of the funding system in light of the
introduction of 100 per cent retention of business rates for
local authorities.
MP, Chair of the
Committee, said: “Councils are currently facing
an uncertain future when it comes to funding with current
settlements coming to an end in 2020.
The Secretary of State told us when he appeared before the
Committee in October that the Government was committed to a
review of the funding formula and the implementation of 100 per
cent retention of business rates for councils.
We hope that Ministers will find this a useful piece of
research and that it makes a value contribution to the debate on
how best to formulate a funding system that is both simple,
transparent and fair.”
The research was undertaken by public sector funding and
financial management specialists LG Futures.
The Committee requested research exploring:
- · A potential
approach to simplifying the current needs assessment
formula
- · Options for
simplifying the wider funding system;
- · The
timeliness of the data sources used in the current needs
assessment formula;
- · A comparison
of potential approaches to the ‘reset’ – ‘fixed period’ or
‘rolling’ – of the business rates baseline
The research can be found on the Committee’s website
at: LG Futures Research
