Pickles counter fraud funding, single investment pot, Miliband pledge, Housing slowdown impact…
0Pickles announces £16m to combat fraud
Local Government Secretary Eric Pickles has unveiled a £16m fund to help councils deal with fraud. Announcing the funding at the Chartered Institute for Public Finance and Accountancy annual conference, he said that councils would be invited to bid for the cash, demonstrating how their proposals will recoup money. The government said that councils are currently losing £2bn to fraud and error. Pickles also encouraged councils to sell idle assets to fund services.
Call to create single investment pot
Government should scrap the current plethora of funding streams for local authorities and replace it with a single investment fund, according to the Local Government Association. The association this week said that the “maze of Whitehall bureaucracy” is creating significant delays in delivering projects and generating confusion and frustration for businesses. According to the report, the public purse is having to spend tens of millions of pounds on bidding for its own money.
Miliband pledges greater freedoms for councils
Labour leader Ed Miliband has outlined proposals to devolve £30bn from central government spending to new “super councils”. In an article for the Sunday Times, he said that large councils similar to the Greater Manchester Combined Authority would also be allowed to keep 100 per cent of extra revenue they generate through business rates, as well as getting greater freedom to set levels. Labour is also planning to slash the number of local enterprise partnerships.
Housing slowdown ‘unlikely to cause significant bank losses’
A slowdown in the housing market caused by rising interest rates would be unlikely to derail the economy or cause significant losses for UK banks, according to ratings agency Moody’s. In a report published this week, it said that although a deterioration in mortgage affordability would lead to a slight slowdown in GDP growth over two to three years, “it is unlikely to change the economic outlook significantly”. It said: “UK banks have the capacity to absorb a shock related to worsening mortgage affordability (e.g., an increase in arrears and write-offs) given the improvement in their capitalisation in recent years.”
Barnsley to create standalone company
Barnsley Metropolitan Borough Council is planning to set up a trading company for its services which support elderly and vulnerable people living in their own homes. The council’s Independent Living at Home Service costs about £2.5m a year to run. The council hopes to charge other councils in the area to run equivalent services, bringing in £2m a year.
Council tax collection rate remains steady
Councils collected 97% of council tax last year, a tiny drop on last year’s rate of 97.4%, according to the Department for Communities and Local Government. The government said that the figures showed that some councils still had scope to step up their efforts against council tax dodgers. The total amount of council tax collected rose by £1 billion, which the government said had resulted from an increase in the number of households.
Independent Scotland ‘faces £16bn public sector deficit’
The Chartered Institute of Public Finance and Accountancy says that an independent Scotland would take on a net liability of around £16 billion. In a report considering the financial implications of any potential devolution, CIPFA said that a devolved Scottish public sector would have assets of around £84bn and liabilities of £100bn. It added that forecast tax revenues would not match spending, “even without taking into account factors likely to impact significantly on the financial sustainability of an independent Scotland”.
