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Local Government Finance

Volume 487: debated on Monday 26 January 2009

To ask the Secretary of State for Communities and Local Government pursuant to the answer of 18 December 2008, Official Report, column 1049W, on local government finance, what estimate she has made of the resources required by local authorities in England to carry out their proposed new responsibilities for strategic commissioning of education for 16 to 18-year-olds; and what discussions she has had with ministerial colleagues in the Department for Children, Schools and Families on the matter. (247762)

I refer my hon. Friend to the answer I gave him on 18 December 2008, Official Report, column 1049W. My Department maintains a regular dialogue with other Departments at both ministerial and official level on policies which affect local government, including resource implications.

To ask the Secretary of State for Communities and Local Government what local authority revenue was provided from (a) central Government, (b) council tax revenues and (c) special grants for each region in each of the last 12 years, ranked in descending order according to the size of increase. [Official Report, 24 February 2009, Vol. 488, c. 1-2MC.] (250719)

Details of local authority funding provided by central Government, council tax revenues and specific and special revenue grants for each region in England in each of the last 12 years are shown in the following tables.

Central Government grant

£ million

North East

North West1

Yorks and Humber

East Midlands

West Midlands

East of England

London

South East

South West

Total England

1996-97

1,952

5,037

3,554

2,561

3,660

3,112

7,029

4,460

2,757

34,121

1997-98

1,931

4,986

3,495

2,570

3,623

3,120

7,049

4,483

2,784

34,041

1998-99

2,028

5,276

3,685

2,659

3,826

3,242

7,254

4,630

2,880

35,480

1999-2000

2,146

5,529

3,876

2,793

4,010

3,391

7,533

4,809

3,024

37,112

2000-01

1,418

3,588

2,455

1,614

2,493

1,891

5,519

2,537

1,624

23,139

2001-02

2,288

5,897

4,153

3,022

4,287

3,740

8,096

5,301

3,264

40,048

2002-03

2,309

5,957

4,181

3,034

4,322

3,754

8,206

5,323

3,270

40,358

2003-04

2,496

6,514

4,565

3,352

4,760

4,094

8,790

5,781

3,588

43,940

2004-05

2,611

6,830

4,777

3,540

5,049

4,307

9,271

6,044

3,743

46,172

2005-06

2,767

7,226

5,058

3,771

5,395

4,594

9,833

6,410

4,004

49,058

2006-07

1,573

3,819

2,624

1,784

2,723

2,011

5,784

2,714

1,825

24,857

2007-08

1,622

3,943

2,708

1,855

2,819

2,086

5.964

2,787

1,893

25,677

Council Tax

£ million

North East

North West1

Yorks and Humber

East Midlands

West Midlands

East of England

London

South East

South West

Total England

1996-97

525

1,529

974

829

1,059

1,099

1,643

1,759

1,044

10,461

1997-98

570

1,651

1,043

885

1,142

1,185

1,748

1,890

1,127

11,241

1998-99

618

1,784

1,143

985

1,244

1,330

1,866

2,114

1,249

12,332

1999-2000

660

1,887

1,211

1,071

1,343

1,457

1,999

2,297

1,353

13,278

2000-01

695

1,988

1,283

1,153

1,435

1,583

2,127

2,474

1,462

14,200

2001-02

736

2,111

1,380

1,238

1,551

1,709

2,301

2,655

1,565

15,245

2002-03

803

2,234

1,492

1,374

1,686

1,902

2,482

2,930

1,745

16,648

2003-04

879

2,442

1,656

1,518

1,869

2,209

2,955

3,415

2,004

18,946

2004-05

938

2,576

1,772

1,633

1,980

2,376

3,174

3,678

2,172

20,299

2005-06

985

2,698

1,868

1,712

2,077

2,492

3,324

3,867

2,291

21,315

2006-07

1,028

2,834

1,968

1,802

2,179

2,633

3,505

4,083

2,421

22,453

2007-08

1,077

2,977

2,070

1,894

2,284

2,785

3,659

4,305

2,557

23,608

Specific and special Revenue grants

£ million

North East

North West1

Yorks and Humber

East Midlands

West Midlands

East of England

London

South East

South West

Total England

1996-97

97

235

177

120

170

140

341

205

133

1,618

1997-98

110

284

237

125

201

141

384

206

139

1,826

1998-99

112

394

264

146

235

177

534

281

193

2,335

1999-2000

143

441

326

193

289

216

713

382

219

2,921

2000-01

216

649

471

311

425

358

1,223

595

364

4,615

2001-02

332

946

681

419

591

486

1,888

742

472

6,558

2002-03

457

1,269

850

578

811

666

2,484

1,059

717

8,891

2003-04

662

1,740

1,142

806

1,119

842

4,831

1,368

902

13,413

2004-05

733

1,978

1,201

925

1,186

946

4,604

1,509

1,009

14,090

2005-06

781

2,074

1,332

968

1,303

1,031

4,660

1,567

1,070

14,785

2006-07

2,098

5,789

4,081

3,216

4,266

3,903

9,403

5,524

3,462

41,741

2007-08

2,203

6,052

4,368

3,390

4,530

4,115

10,123

5,948

3,757

44,486

1 Includes Merseyside

Source:

Communities and Local Government Revenue Outturn Summary (RS) returns.

The definition of central Government grant used here is the sum of formula grant (revenue support grant, redistributed business rates and police grant) and Greater London Authority (GLA) grant. In past years, where applicable the SSA reduction grant and Central Support Protection Grants have also been included.

The definition of specific and special grants used here is Specific grants inside Aggregate External Finance (AEF), i.e. revenue grants paid for council's core services.

Figures exclude grants outside AEF (i.e. where funding is not for authorities' core services, but is passed to a third party, for example, rent allowances and rebates), capital grants, funding for the local authorities' housing management responsibilities and those grant programmes (such as European funding) where authorities are simply one of the recipients of funding paid towards an area.

Comparison across years may not be valid owing to changing local authority responsibilities.

To ask the Secretary of State for Communities and Local Government what recent assessment she has made of the effects of the economic downturn on the income of local authorities; and if she will review the level of revenue support grant paid to local authorities. (250916)

The effects of the economic downturn on the income of local authorities was an issue identified in a recent report by the Audit Commission entitled ‘Crunch Time’, which looked at the impact of recent economic changes on local authorities' finances. The report found that councils are generally prepared for the impact of the economic downturn.

Following consultation with local authorities on the provisional local government finance settlement 2009-10, I confirmed our plans for the funding of local authority revenue spending through Formula Grant on 21 January which is now subject to parliamentary approval. Overall Government grant to local authorities will next year be £73.1 billion which provides an increase of 4.2 per cent. on a like for like basis. This is the second year of a three year settlement which provides councils with an additional £8.9 billion up to 2010-11 and gives them the certainty and flexibility they need to plan ahead and manage their budgets. We also expect authorities to deliver £4.9 billion net cash-releasing savings over that period, which can be used to improve services and control council tax pressures.

To ask the Secretary of State for Communities and Local Government if she will make it her policy to bring forward payments to local authorities in order to mitigate the amount of interest forgone by local authorities in meeting targets for payment of supplier invoices within 10 days. (251131)

Local authorities are responsible for their own payment arrangements and in the present economic downturn many are taking steps to ensure invoices are settled promptly. In putting in place the first-ever three-year settlement last year, we gave councils an extra £8.9 billion and the certainty and flexibility they need to plan ahead and manage their budgets.