Launch of independent commission on local government finance

02-06-2014

An independent commission has been tasked with making recommendations for the reform of local government finance and finding better ways to fund local services and promote economic growth in England.

The Commission on Local Government Finance is to be chaired by Darra Singh, partner in the Government and Public Sector team at EY (formerly Ernst & Young).

Its recommendations will be presented to all of the main political parties with the aim of shaping the debate on the future of local government finance and influencing the next government.

The Commission has been established by the Local Government Association (LGA), the national voice of local government, and the Chartered Institute for Public Finance (CIPFA), the professional body for public finance professionals.

Last year both the LGA and CIPFA individually set out proposals for the urgently needed reform of public services to make them fit for the 21st century.

The commission will build on this work. It will examine the need for reform of local government finance and the ways in which the current system stands in the way of the transformation needed to tackle real world problems from the need to create more jobs and grow local economies to tackling the housing shortage.

It will explore how an improved local government finance system could help to address five key challenges facing the country within the context of lower public spending:

  • Promoting economic growth and investment in infrastructure  
  • Ensuring sufficient housing is provided in every place 
  • Integrating the health and social care systems to promote independent living, including preventing unnecessary health interventions
  • Achieving a welfare benefits system that promotes work and protects the vulnerable
  • Supporting families and developing young lives through early intervention.

Commission chair Darra Singh said:

“We know that public spending will continue to fall, there is growing demand for social care and promoting growth is vital. Previous commissions have looked at reforms to local government finance. But the challenges are now much more critical which means the work of the Commission could not be more timely. It is a privilege to be invited to chair the Commission. I am looking forward to working with the other commissioners to identify practical solutions that will help enable local and central government’s vision for our communities.”

LGA Chairman Sir Merrick Cockell said:

 “Reviews of local government finance have been undertaken before. What is different this time is that the nature of the challenge and the prize have never been clearer. Without reform of public services, a combination of rising demand and reducing resources will make the public services people value unsustainable and undermine the nation’s future prosperity.

“Our work to date leads both CIPFA and the LGA to the conclusion that reform of the  local government finance system is central to developing new ways of delivering public services and growing local economies.  The purpose of the local government finance system is to help solve these real world problems. I am really looking forward to the independent commission’s ideas on how this could be done more effectively.”

CIPFA Chief Executive Rob Whiteman said:

“For many years CIPFA has expressed its growing concerns with the way that local government is financed in England.

“Governments of all persuasions have let the public down with their refusal to reform the system and the way in which they have allocated precious public resources has repeatedly demonstrated the urgent need for change.

“CIPFA hopes that this independent commission into local government finance will help to redress this issue and provide impartial and insightful advice to all those involved in the future funding of local government.”

The Commission is expected to publish interim findings in the Autumn ahead of a final report in early 2015.

NOTES

Commission website including commission biographies: http://www.localfinancecommission.org/