Headlines: February 4th, 2003

Every local authority is to receive an increase in its level of government funding above the rate of inflation. Final figures from the Office of the Deputy Prime Minister show councils and the communities they serve will benefit from a 5.9% increase for the next financial year.The report shows how grant support will be distributed across the country following consultations with local government on the provisional allocations announced in December.

The Local Government Minister, Nick Raynsford, claimed the settlement was an excellent one for local councils. Last year, he said, the government was able to guarantee authorities an increase at least in line with inflation but this year it had gone a step further and every authority would receive an above inflation increase with the highest ceilings so far.

“We have now increased funding to local government by 25% in real terms over the last six years, he said. “This year’s good increases mean councils should be able to continue to deliver improvements in the services they provide while keeping to reasonable council tax increases.”

Mr. Raynsford said the new system for distributing grant had been the subject of extensive consultation and the government was satisfied that as many of the problems of the previous system as possible had now been removed.

“Obviously there are some councils who do not like the formulae for subjective reasons but central government must look at the whole picture and we are satisfied that the formula is the fairest answer in the round,” he said.