Funding devolution, Record fraud, Crowdsourced finance, Liverpool take back ICT…

Written on:October 23, 2014
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LGA in plea for funding devolution
The Local Government Association has called on chancellor George Osborne to devolve more funding freedoms to local authorities in his Autumn Statement. The association called on Osborne to “make place based finance the default method of funding and delivering local public services, empowering local partners to work towards shared outcomes”. It also said that all funding for local growth, regeneration, skills and employment should be devolved to local enterprise partnerships, and allow the complete local retention of business rate revenue.

Councils detect record fraud levels
English councils detected £188m of fraud in 2013/14, a ten-fold increase since 1990, according to a new report by the Audit Commission. Jeremy Newman, Chairman of the commission, urged the government to mandate the provision of fraud data from all local authorities, after the body’s closure next year. The report arrived as the Chartered Institute for Public Finance & Accountancy launched a new code of practice on counter fraud.

Council funding venture gains momentum
Rushcliffe Borough Council has become the tenth UK council to join a funding platform run by crowdsourcing website Funding Circle. The Local Business Lending Partnership initiative allows local authorities to invest in start-up and existing small businesses in their area while earning a rate of interest.

Liverpool estimates insourcing savings at £30m
Liverpool City Council estimates that it will save £30m over the next three years by taking services provided by a joint venture with supplier BT back in house. The authority announced last year that it would exit the Liverpool Direct Limited joint venture providing ICT and back-office functions. The savings would be made between 2014 and 2017, the council said.

LGA welcomes growth findings
The Local Government Association has welcomed the conclusions of the Cities Growth Commission report, released by the Royal Society for the encouragement of Arts, Manufactures and Commerce. LGA chair David Sparks said: “The Cities Growth Commission report confirms that the benefits of devolving powers to local areas in England are simply too big to ignore.”

Local borrowing surplus rises
Local borrowing in the financial year to September was in surplus by £6.5bn, an increase in surplus of £100m compared to the same period last year, according to new figures from the Treasury.
The department’s latest Public Sector Finances Bulletin attributed the rise mainly to “lower net investment so far in this financial year offset by the timing of grant payments from central government, which are lower in the year to September”. In September 2014 local government net borrowing was £1bn, a decrease of £0.2bn on last year.

Councils explore collective model for new homes

Written on:October 23, 2014

The Local Government Association is consulting with councils about a new collective investment model which could unleash a large scale affordable housebuilding programme free from public subsidy. The association has written to local government chief executives to gauge appetite for a plan which would see councils band together to gain institutional investment for thousands of new homes. The proposals are aimed at reducing the costs of entry to gain such…

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Bournemouth’s Wilkinson resigns following suspension

Written on:October 23, 2014

Bournemouth Borough Council’s executive director for finance has resigned, two weeks after it was announced that she had been suspended following complaints about her behaviour. Liz Wilkinson had been driving the authority’s creation of a community finance initiative (CFI) to lend to small businesses and first time buyers. She joined Bournemouth after leaving her previous role as head of financial services and section 151 officer at neighbouring Borough of Poole Council…

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Leeds sells off £93m of property portfolio

Written on:October 23, 2014

Leeds City Council has approved a plan to dispose of £93m of property assets from its portfolio. Earlier this week, the council’s executive board voted to progress the asset management plan, which aims to save £4.5m in revenue costs between 2014 and 2017. The council says that it has already disposed of £27m worth of assets, which has resulted in £6.5m of revenue savings, and says another £4.5m will come…

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What German savings tell us about the European real economy

Written on:October 21, 2014

For the first couple of years that followed Mr Draghi’s ‘whatever it takes’ speech, made in 2012, there was an important change in behaviour by German savers, that resulted in the German household sector becoming one of the primary providers of capital not only to their domestic risk asset markets but also to the global asset markets, including those within the Euroland periphery. Thus, the German private sector acquired not…

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Conference protest, Stockton cuts cabinet, Coventry sells arena stake…

Written on:October 17, 2014

Council attendance at conference sparks protest Protestors harangued developers and council representatives attending the Mipim real estate conference in Olympia this week forcing police to “lockdown” the venue, according to the Guardian.  The paper quoted one protestor outside the venue saying the conference was an event where “councils sell off public land behind closed doors.”Boris Johnson spoke at the conference describing London as the “property capital of the world” but…

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Ask the Auditor: Schools, subsidiaries, associates & JVs

Written on:October 16, 2014

The CIPFA/LASAAC Code of Practice on local authority accounting for 2014/15 includes some important changes from previous years. In our regular feature, Ask The Auditor, Graham Liddell from Grant Thornton UK LLP discusses new accounting requirements for schools, subsidiaries, associates and joint ventures and the practical implications for local authorities. To ask Graham a technical query, email editor@room151.co.uk The 2014/15 Code brings in two big changes: the Code now requires…

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Q&A with Jill Davys

Written on:October 15, 2014

Jill Davys is head of financial services at the London Borough of Hackney and is involved in a number of national frameworks for LGPS administering authorities and the London LGPS CIV. Room151: What’s happening with the LGPS frameworks and how do they work? Jill Davys: So far we’ve set up national frameworks for LGPS funds to access investment consultancy, actuarial and custody services and we’re currently working on another to…

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Barnett formula, LGPS reform and generating revenue

Written on:October 15, 2014

In a change to James’ regular markets briefing, we asked CCLA’s chief investment officer to reflect on some of the challenges facing local authorities today. R151: The Scottish referendum had generated much discussion about local authority finance. Where do you think it all leaves the Barnett formula? JB: In the heat of the debate on Scottish independence, leaders of the main UK political parties committed to sharing “resources equitably across all…

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Is a flight to bonds on the cards?

Written on:October 9, 2014

At Room151’s recent conference for local authority treasurers, 32% of the audience said they were likely to ‘significantly increase their allocations’ to corporate bonds over the coming year. That was higher than both money market funds (with a 16% increase) and other local authorities (28%). As a provider of Sterling denominated, short-term bond funds, the news was of course welcome. But what’s the story behind the number? Firstly, I would…

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