Government funds fail to meet needs, says LGA

06 December 2006
 
Council leaders have slated the latest local government finance settlement and warned that the Government is failing to meet the increased cost of services.
Local government and community cohesion minister, Phil Woolas, has said the two-year budget proposals, unveiled last year, will remain unchanged, with councils to receive a total of £65.7bn in grants – an increase of £3.1bn or 4.9% on 2006-07.
Woolas claimed the Government had increased grants to local services by 39% since taking office in 1997, and that council tax rises should be kept to less than 5%. He also promised that in future grant allocations will be made for three year periods.
However Sandy Bruce-Lockhart, chairman of the Local Government Association, pointed out that the highest proportion of extra grant had gone to education and explained: ‘For services other than schools, and other specific grant-funded government priorities, government funding has increased by just 14% in real terms.
‘We look to the Lyons inquiry to provide a funding system which is fair to the council taxpayer and capable of meeting the increasing demands for our services and emerging national challenges.’
Cllr Merrick Cockell, chairman of London Councils, said 20 London boroughs would receive only a minimum 2.7% increase in grant and the settlement was ‘extremely disappointing’.
‘Local councils will now face tough choices between cutting back services or increasing council taxes.
‘The current system fails to take account of London’s rapidly-growing population and its changing needs,’ he added.

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