CIPFA pre local government settlement briefing


An uncertain future for local authorities

Ahead of the local government settlement this week, the Chartered Institute of Public Finance and Accountancy (CIPFA) has issued a pre-settlement briefing note looking at the some of the stark choices facing local authorities, as they deal with increased pressures on services alongside ongoing funding cuts.

The briefing is based upon the qualitative and quantitative research from a range of local authority stakeholders from Treasurers’ Societies, individual Chief Finance Officers and other experts in local government finance.

The research found that of particular concern to local authority finance chiefs were:

  • Ongoing demographic pressures, both from the ageing population alongside an increasing demand for statutory children’s services.
  • A lack of transparency about the future of the Council Tax Freeze Grant, resulting in authorities who take the grant facing a potential fiscal cliff if funding ends.The implementation of the Care Act and its potential cost implications, for which local authorities currently lack a sustainable financial model.
  • Based on previous experience, there is also uncertainty about long-term capital funding for investment following the general election.
  • Distributional issues underlying the New Homes Bonus which has resulted in a geographical bias in its allocation.

Speaking ahead of the local government settlement Rob Whiteman, Chief Executive of CIPFA, said:

“As we’ve talked to local authorities we’ve seen that the mounting pressures on services, combined with ongoing cuts, are pushing those who manage the public money to make stark choices over services.

“We need the government to acknowledge this and end short-term, stop gap initiatives that harm the sustainability of local authority finances and act against the long-term public interest.

“CIPFA hopes that the forthcoming Local Government Settlement recognises some of these realities and undertakes measures to meet some of these issues. We also believe that now more than ever we need an independent and evidenced based approach to allocating funding to councils in a fair, reasonable and sustainable way.”


Notes to editors

A full copy of the briefing note is available online or from the CIPFA press office.