Headlines: December 7th, 2007

Councils in some parts of the country will face tough choices over spending cuts following the Local Government Finance Settlement, according to the Local Government Association. The settlement, announced by the Minister for Local Government, John Healey, provides around three-quarters of all the money councils spend locally.

In response to the announcement, Sir Simon Milton, chairman of the LGA said, “In certain parts of the country the money councils will receive, when faced with the increased pressure on their services, will make it the worst settlement for a decade. The impact across England will vary as there is no one size fits all, but in some regions local councils will have to make tough choices between spending cuts and council tax rises above inflation.”

The LGA has picked out four areas of concern that will have an impact on council budgets for the remainder of this decade. First among these is that an extra 400,000 people will pass their 65th birthdays and many of them will need social care. The next worry is the escalating costs of landfill because Britain is still sending more rubbish to landfill than any other European Union country and landfill taxes are rising significantly. The third factor is the introduction of free England-wide bus travel for over 60s and some disabled people and finally the LGA is concerned about the lack of proper figures on migration.

Giving details of the settlement, Mr. Healey said 66 local and 21 transitional authorities would get a share of a new 1.5 billion pound fund as part of the drive to deal with long term unemployment. The Working Neighbourhoods Fund is being set up for councils and communities to develop more concentrated, concerted, community-led approaches to getting people in the most deprived areas of England back to work. It replaces the existing Neighbourhood Renewal Fund and incorporates the Department of Work & Pensions Deprived Areas Fund.

Mr. Healey said, “In a tough financial climate Government is focusing its efforts and resources where they can have the most impact. New data shows that 20 per cent of men and women living in the most deprived 20 per cent of areas are not in work. At a time when people are working harder than ever before it is only right that we find new ways to get the long term unemployed into work – and also ways to keep them there.”