News Roundup: EU structural funds, devolution, tax raising, business rates, pensions advisory board

Councils lose EU funds fight
A coalition of nine councils in Merseyside and South Yorkshire have lost their court battle with the government over their allocation of European Union structural funds. The nine authorities claimed that they had received an unfair cut of 61% in funding for 2014-2020, compared to other similar regions of the UK  hit with a 5% cut. However, the Supreme Court rejected their case by a 4-3 majority.

Commission highlights devolution benefits outside cities
Too much of the current devolution debate is focused on cities, according to a commission which reported this week. The Independent Commission on Economic Growth and the Future of Public Services in Non-Metropolitan England, said that devolving skills and training spending to non-metropolitan areas could generate £8.7bn each year for the national economy. Meanwhile, savings from adopting more effective ways of working across the range of public sector organisations could be worth £12bn over five years, it said.

“Unprecedented pressures” for Scottish authorities
Scottish councils face pressures from next year on a scale not previously experienced, according the country’s Accounts Commission. In its annual report, the commission called for difficult decisions on spending to be taken now to avoid storing up problems for the future. Douglas Sinclair, chair of the commission, said: “Regular reviews of governance are essential due to continuing changes in council staff, management and political structures and delivery models, such as the use of arm’s-length external organisations and the new health and social care partnerships.”

Businesses back local business rate decisions
More than two-thirds of UK businesses agree that councils should be able to set business rates locally in discussion with local businesses, according to a survey. Polling for the Local Government Association, by pollster ComRes, found 68 per cent of businesses across the UK agree that business rates should be set locally in discussion with local businesses. Just 7% of businesses surveyed disagreed.

No new tax-raising powers for councils
The government has set itself against giving new tax-raising powers to local authorities. In its response to a communities and local government select committee report on devolution, it said: “There is a difference between policies which increase the burden of municipal taxation, and those which allow councils to share from the proceeds of enterprise and economic growth. The first ultimately hinders economic growth, the second encourages it.” It also said that it had no plans to allow the local setting of business rate levels.

Scales takes up West Sussex role
Former London Pensions Authority chief executive Peter Scales has been appointed as the chairman of West Sussex County Council’s new pension advisory board. Scales is one of the first people to be appointed to such a role, which was introduced in an attempt to improve governance of local government pension schemes. Scales is currently a senior adviser at investment firm AllenbridgeEpic.

Barnet appoints joint venture partners
London Borough of Barnet has appointed two development firms as partners on the Brent Cross South regeneration scheme in London. The council granted planning permission last year for a new neighbourhood of 7,500 homes on a 78ha site. It will put land into the joint venture with Argent and Related Properties contributing expertise and investment.

Worries raised over Birmingham partnership
Birmingham City Council should scrap its joint venture with Capita to provide its IT services unless it can attract other clients, according to a councillor. According to councillor Ken Wood, a member of the contracts and partnership scrutiny committee, unless the Service Birmingham vehicle is selling services to other agencies the joint venture arrangement is a waste of time, according to the Birmingham Post.

Councils set to create “coordination company”
A new “coordination company” could enable joint working arrangements between South Northamptonshire Council and Cherwell District Council. The two authorities have agreed a deal after a two month consultation on the draft business case. The company, owned by the two authorities, would coordinate services, in conjunction with employee mutual or council-owned companies.

MPs call for equity in public health funding
Funding for public health is falling short of needs for a third of local authorities, according to the House of Commons’ public accounts committee. A report from the PAC said 51 out of 152 upper tier authorities received 20% above or below their fare share, taking into account their relative needs. Committee chairwoman Margaret Hodge said: “The department should set out clear plans for how quickly it will move local authorities to their target funding allocations for public health…”