England & Wales Finance

LGiU Response to Budget 2013

This is a budget that will be met with some relief by finance chiefs across the country. The Secretary of State has protected local government from further cuts, although this may be tempered by January’s formula grant reduction next year. Many will also be unimpressed to see the commitment to the council tax deal remain at a time when councils need all the levers available to them.

LGiU welcomes the Treasury’s commitment to growth and the lead role which councils will have via the Heseltine review. The announcement of additional money for housebuilding represents an important shift in emphasis that local government will particularly welcome.  The National Planning Policy Framework, which aimed to free up the planning system, was based on the idea that local government was standing in the way of new homes.  However, with 400,000 plots already approved for development, the real stumbling block is access to finance.  It’s encouraging to see government recognise this.

The Government’s adoption of the recommendations of the Heseltine reviews is key to Mr Osborne’s whole framework for growth. What we need to see now is strong local leadership to make the most of the new menu of economic development powers, flexibilities and resources potentially on the table for ambitious areas and to align these with ‘traditional’ local government growth levers such as education and training.

It seems that finally, the Chancellor understands that growth starts locally, and perhaps the Treasury understands that councils have the vision to understand how this works on the ground.