Cornwall’s Local Government Finance Settlement for 2017/18

It is always a nervous time in Local Government circles when the Government announces its financial settlement for this sector. Over the last few years, the news has not been positive; you know it is going to hurt, but how much it will hurt you only find out in the announcement.

This announcement and publication of the settlement marks the start of a consultation period until 13 January 2017. The final settlement for 2017/18 will be laid before the House of Commons in February 2017.

So how much hurt is contained within the proposed settlement? The positve news is overall on first review the settlement remains largely as expected as there is no change in the levels of Revenue Support Grant, Rural Services Delivery Grant or Better Care Fund. However at this stage not all information is available and as always the devil will be in the detail. But we do know there have been changes to the following grants:

  • New Homes Bonus (NHB) – due to further changes in the way the reward is calculated NHB will reduce in 2017/18 by c£0.750m compared to the existing assumptions within the Council’s financial plan;
  • Adult Social Care Support Grant – This is a new grant that has been established, funded from savings in the New Homes Bonus. Amounts will be distributed according to relative need and Cornwall’s indicative allocation is £2.806m but is one-off only for 2017/18. (sadly nothing for Children’s Social Care)

At face-value, there is also a bit of positive news with the Government confirmed that Cornwall Council will pilot 100% Business Rates Retention from April 2017, although the details of that scheme are yet to be announced and are expected to form part of the final settlement in February 2017.

There is good news on Council Tax referendum limits for Town and Parish Councils. As the proposed introduction of a referendum limit to larger Town & Parish Councils will be deferred, although the Government will continue to monitor the situation and look to make excessive increases more transparent. If this was implemented it could have affected at least six Town Council’s in Cornwall.

And now for the bad news. As you maybe aware, the Government allowed local authorities to add onto the Council Tax bill a 2% levy for Social Care. Now the Government is allowing local authorities to increase this percentage. I totally support we need more money in Social Care; however, I have two concerns on this.

The first is Social Care should also include Children’s Social Care, but this extra levy cannot be used to help any Children’s Social Care, in fact is it rather limited on what is can be spent on. So to call it a Social Care levy is rather misleading!

The second is the Government has introduced a postcode lottery on Adult Social Care by means of this levy; whereas it should be properly funding the service in the first place – and yes that includes Children’s Social Care too. A further problem is as the Government is not funding it properly by passing the buck to a local authority who may not want to increase the Council Tax further because of pressures on its residents finances. If a local authority does not increase the levy, then the Government will just blame the Council for not providing the right level of funding. Hardly fair.

Anyway, lets hope there are no hidden surprised tucked away in the detail…

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