Magazine article Public Finance

Ministers Prioritise Pooled Spending

Magazine article Public Finance

Ministers Prioritise Pooled Spending

Article excerpt

Plans to establish Community Budgets across England have taken a step forward after the government wrote to councils offering help to pool local funding across the public sector.

A letter, seen by Public Finance, was sent the day after Chancellor George Osborne pledged to 'drive the transformation of local public services' through the expansion of pooled spending initiatives in his March 20 Budget. In his statement, he announced further cuts to local government spending of 1%, although these will not kick in until 2014/15.

The letter, from local government minister Brandon Lewis, said 'whole place' Community Budgets could 'deliver better outcomes at lower cost'. He has asked councils to submit expressions of interest to join a new 'multi-agency network' to share learning from the existing four Community Budget pilots.

Lewis's letter stated that the network would be dedicated to 'removing policy barriers that hinder reform' and would be based on the experiences of the four pilot areas: Cheshire West & Chester council; the Greater Manchester combined authority; the west London tri-borough project; and Essex.

Councils will be given support to develop new pooled spending initiatives if they meet six criteria. These include demonstrating a history of joint working and showing that each can provide funding towards the scheme.

The network would allow the government to work with councils to 'codesign practical reforms', Lewis added. It would 'use the learning from the whole place Community Budget pilots... and work with other places to redesign services to support better outcomes for the public and boost growth'.

The Local Government Association welcomed the initiative. Sharon Taylor, chair of the group's finance panel, said Community Budgets could lead to 'much more effective spending* in local areas.

However, these schemes needed careful planning and 'radical thinking about core public spending*, so may take time to develop, she added.

Taylor also told PF the additional spending cuts could place more town halls in financial difficulty. Asked if these cuts - on top of the 2% reduction announced for 2014/15 in December's Autumn Statement - would lead to further cases of distress, Taylor confirmed it was likely. Councils had taken a 'major hif since the government came to power, and the LGA would be undertaking a survey of authorities to assess the impact on their financial health. …

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