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Budget 2014: Expert comment on the impact of the announcement on local government

Paul Dossett, Head of Local Government at Grant Thornton UK LLP, said:

"Local government has been one of the hardest hit parts of the public sector, with central government funding having been cut by 40% over the current parliament.  In the run up to the Budget, sector bodies, such as the LGA, the Core Cities Group and the County Council Network, all called for greater certainty on future funding to support effective and sustainable strategic planning. The provision of this certainty was absent in the Chancellor’s speech today. With only 40% of planned spending cuts currently in place, many parts of the public sector will continue to face significant challenges.

"Billed as a 'budget for a resilient economy', the Chancellor announced that public finances will move into surplus during 2018/19, but that additional cuts will be required. However, he provided no further detail – other than a cap on welfare spending – as to where the axe will fall beyond measures already announced.

"There was some good news for some localities in relation to well-trailed infrastructure projects, including Barking Riverside, Brent Cross and the new garden city at Ebbs Fleet as part of a series of measures designed to increase the building of 200,000 new homes and wider regeneration investment. This, along with other transport and infrastructure support, could go some way in offering affected councils a bit of relief.

"More broadly, local government's Budget wish list largely fell on deaf ears, with no certainty on the future revenue funding of local government provided by the Chancellor, and uncertainty remaining over potential additional funding reductions beyond 2015/16. There will of course be some trickle down impact as a result of the increased infrastructure spending announced by the Chancellor, but the long term outlook of local government revenue funding remains highly challenging, and the resilience of some local authorities remains uncertain."