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Local Government: Efficiency Savings

Volume 698: debated on Tuesday 29 January 2008

asked Her Majesty's Government:

For how many successive years they are requiring local authorities to find 3 per cent cash efficiency savings; and for how many years they expect local authorities to find such savings without making cuts in services. [HL1429]

During the 2007 Comprehensive Spending Review period (2008-09 to 2010-11), there will be no mandatory targets for efficiency gains for individual councils in England. While the sector overall is expected to deliver 3 per cent per annum efficiencies over this period—in line with the minimum requirement for the public sector as a whole—targets will only exist at the local level where these are negotiated as one of the up-to-35 targets in each local area agreement.

Cuts in services do not result in valid efficiency gains. Cash released through efficiencies is retained by councils for reallocation to meet local priorities for services. Looking at ways of delivering better services in more efficient ways should be part of normal business processes for any organisation.