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Saturday, 2 February 2013

#6keyissues in #nao financial stability of local authorities report

the pdf of the executive summary and full report of the 30/1/13 nao report on this subject can be found here

in summary what struck me from the report was the following:

- authorities still need to find 1/2 of the savings required in the period April 2011 to March 2015  (overall in that period there is a 14% (real) reduction in local authorities income from central government)

- FDs think the largest savings will come through efficiencies;

- the provisions of the Localism Act 2011 have yet to be used in anger as concerns holding referendum when council tax is increased above certain thresholds sets by central government;

- the government attached the highest priority to adult social services in deciding one of the key elements of the formula determining the distribution of grant but in practice in the 3 years ending 2012-13, the lowest reduction in local authority spending was for children’s services (some local authorities attributed this to increased demand for children’s services and concern to avoid the human and reputational risks attached to the failure of that service);

changes concerning the partial localisation of business rates and arrangements for council tax benefits may expose councils more to income reductions;

- 12% of local authorities are at ongoing risk of been unable to balance their budget in future financial years

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