The government announced (in the Pre-Budget Report 2005) an additional 305 million in 2006-07, and 508 million in 2007-08, in central grants for local authorities (the first two-year settlement of this kind). It said that this would enable them to continue delivering high quality public services alongside low council tax increases.
Source: Britain Meeting the Global Challenge: Enterprise, fairness and responsibility - Pre-Budget Report, Cm 6701, HM Treasury, TSO (0870 600 5522) | House of Commons Hansard, Debate 5 December 2005, columns 627-642, TSO
Links: Report | HMT press release | Hansard | ODPM press release | LGA press release | Guardian report
Date: 2005-Dec
A survey examined public attitudes to local government funding. Many people did not know which council tax band their house was in. Few people were able to say what proportion of the money their local council spent every year came from council tax. Only 1 per cent of the sample felt that council tax in their area provided very good value for money.
Source: BMG Report of Wave 1 Survey, Lyons Inquiry into Local Government (020 7270 5214)
Links: Report
Date: 2005-Dec
A literature review examined options for changing the way local government was financed in England.
Source: NERA Economic Consulting, Options for Reforming Local Government Funding: A Report for the Lyons Inquiry Study Team, Lyons Inquiry into Local Government (020 7270 5214)
Links: Report
Date: 2005-Dec
A survey examined public attitudes to the principles behind taxation, and tested attitudes to potential options for reform of local government funding. There was high awareness of income tax, council tax, and VAT. Levels of awareness (including the amount individuals paid and different types of taxation) were primarily affected by socio-economic group and income: more affluent respondents were more aware of taxes on savings, inheritance, and capital gains. There was confusion over which services were funded by local government and which by central government. There was a strong feeling that local authorities were bureaucratic, inefficient, and wasteful of public money.
Source: Alison Palmer and Michael Thompson, Public Attitudes to Taxation & Public Services: Report of qualitative research findings, Lyons Inquiry into Local Government (020 7270 5214)
Links: Report
Date: 2005-Dec
The interim report of an official inquiry into local government funding said that the public were confused about who made the key decisions on local services, what those services cost, and how they were paid for.
Source: Consultation Paper and Interim Report, Lyons Inquiry into Local Government (020 7270 5214)
Links: Report | Lyons Inquiry press release | LGA press release | Guardian report (1) | Guardian report (2)
Date: 2005-Dec
A report examined case studies from local authorities who were making innovative use of prudential borrowing (one of the flexibilities introduced in the Local Government Act 2003).
Source: Using prudential borrowing: One year on, Local Government Association (020 7664 3000)
Links: Report
Date: 2005-Nov
A report examined the funding challenges likely to be faced by local authorities in 2006-07. It said that local authorities faced a 2.2 billion 'black hole' in their finances - equivalent to a rise of 10 per cent in council tax bills unless the government injected substantial extra funding.
Source: Beyond the Black Hole: A time of opportunity and challenge, Local Government Association (020 7664 3000)
Links: Report | LGA press release | CIPFA press release | Community Care report
Date: 2005-Nov
An audit report said that local councils could save 140 million by pooling services - an amount far in excess of the efficiency target of 75 million a year over three years set by central government.
Source: The Efficiency Challenge: The administration costs of revenues and benefits, Audit Commission (0800 502030)
Links: Report | Audit Commission press release | LGA press release | EOLG press release | Community Care report | Guardian report
Date: 2005-Nov
The government announced the postponement of the planned revaluation of council tax in England. It said that it had extended the existing inquiry into local government funding (under Sir Michael Lyons), so that it could consider issues relating to the wider functions of local government and its future role.
Source: Press release 20 September 2005, Office of the Deputy Prime Minister (020 7944 3000)
Links: ODPM press release | LGA press release | CIPFA press release | Guardian report
Date: 2005-Sep
A report said that local councils achieved over ?700 million of efficiencies in 2004-05, and already had plans to exceed the government?s target for ?1.2 billion efficiencies for 2005-06.
Source: Annual Efficiency Statements, Institute of Public Finance/Chartered Institute of Public Finance and Accountancy (020 7543 5602)
Links: Summary (pdf) | CIPFA press release | ODPM press release | Guardian report
Date: 2005-Jul
The government announced that 8 local authorities in England would have their budgets capped in 2005-06, and would need to set lower council taxes.
Source: House of Commons Hansard, Written Ministerial Statement 7 July 2005, columns 14-15WS, TSO (0870 600 5522)
Links: Hansard | ODPM press release
Date: 2005-Jul
Following consultation, the government confirmed its intention to move to three-year funding settlements for local government by the end of the existing Parliament. The first settlement, to be announced in autumn 2005, would cover the two years 2006?07 and 2007?08. From 2008?09, three-year settlements would be fully aligned with the spending review cycle.
Source: House of Commons Hansard, Written Ministerial Statement 19 July 2005, columns 60-62WS, TSO (0870 600 5522)
Links: Hansard | Consultation responses (pdf) | Consultation document (pdf)
Date: 2005-Jul
The government began consultation on options for change to the formula grant system - used to distribute grants to reflect the relative circumstances of local authorities, as well as the policy or operational context for local authority services.
Source: Local Government Finance: Formula Grant Distribution - A consultation paper, Office of the Deputy Prime Minister (020 7944 3000)
Links: Consultation document (pdf links) | ODPM press release
Date: 2005-Jul
An article examined the consideration given to issues of equity in the policy debate over local taxation reform.
Source: Michael Orton, 'Inequality and the reform of a regressive local tax: the debate in the UK', Social Policy and Society, Volume 4 Issue 3
Links: Abstract
Date: 2005-Jul
The government said that it planned to cap the budgets of nine local authorities which had sought council tax rises exceeding the level of inflation.
Source: House of Commons Hansard, Debate 23 March 2005, columns 883-892, TSO (0870 600 5522)
Links: Hansard | ODPM press release | LGA press release | Guardian report
Date: 2005-Mar
The government said that the average council tax per dwelling in England would be 1,009 in 2005-06, compared with 967 in 2004-05 - an increase of 4.3 per cent. This would be the lowest increase in more than 10 years.
Source: Press release 23 March 2005, Office of the Deputy Prime Minister (020 7944 3000)
Links: ODPM press release | LGA press release | Guardian report
Date: 2005-Mar
A report provided a detailed overview of the origins and development of participatory budgeting - a mechanism of local government, which brings local communities closer to the decision-making process around the public budget.
Source: Jez Hall, Breathing Life into Democracy: The power of participatory budgeting, Oxfam GB (01865 313184) and Community Pride Initiative
Links: Report (pdf)
Date: 2005-Feb
The government confirmed that local authorities in England would receive more than 60 billion in government grant in 2005-06 - an increase of 6.3 per cent over the previous year.
Source: House of Commons Hansard, Written Ministerial Statement 27 January 2005, columns 24-25WS, TSO (0870 600 5522)
Links: Hansard | ODPM press release
Date: 2005-Jan
The Office of the Deputy Prime Minister set out its capital investment plans resulting from the 2004 Spending Review.
Source: Departmental Investment Strategy 2005-2008, Office of the Deputy Prime Minister (0870 1226 236)
Links: Strategy (pdf)
Date: 2005-Jan