English councils’ funding 26% lower

By stewartb

It is right to draw comparisons between Scotland and Wales on this and other matters. For as long as we are within the Union this is relevant for various reasons including but not limited to: (i) testing UK political parties for consistency over policies and actions (as here with Labour and Wales), and (ii) because of the wider effects of powers and policy decisions over financing held in Westminster.

(I look forward to the day when we compare the performance of an independent Scotland’s government and our public services against benchmarks in places such as the Nordic countries!)

Talking up Scotland by publishing such comparisons is also, candidly, providing a ‘public service’ . This is because the corporate media in Scotland and, UNFORGIVABLY, the ‘public service’ broadcaster, BBC Scotland seem incapable – or more likely, FOR THEIR OWN ‘REASONS’, UNWILLING – to offer UK-wide context or perspective to audiences in Scotland. Except where it is seen as useful for negative framing of a news story!

To add to the useful information on local government finance in Wales relative to Scotland, this from the National Audit Office published in November, 2021 reveals what has been happening in England.

Source: https://www.nao.org.uk/wp-content/uploads/2021/11/The-local-government-finance-system-in-England-overview-and-challenges.pdf

‘Government-funded spending power has reduced by more than 50% since 2010-11.’ and ‘Government has reduced funding for local authorities since 2010, while council tax has risen.’

For more explanation from the NAO: ‘The Department for Levelling Up, Housing & Communities (the Department) measures the income it makes available for local authorities through ‘spending power’.

‘This indicator captures the MAIN STREAMS OF GOVERNMENT FUNDING TO LOCAL AUTHORITIES, in addition to council tax. Accordingly it does not include various other forms of local income, such as sales, fees and charges, or commercial income.’ (my emphasis)

‘If council tax is removed, spending power funded by government fell in real terms by more than 50% on a like-for-like basis between 2010-11 and 2020-21. After an initial fall, council tax has grown substantially in real terms since 2016-17.’

‘The recent council tax growth has led to a real-terms stabilisation in overall local authority spending power. While overall spending power is 26% lower on a real terms, like-for-like basis than in 2010-11, the growth in council tax since 2015-16 has helped stabilise overall spending power in that period.’

In short, according to the NAO, the Westminster government has slashed its direct funding to local government in England since 2010-11. Presumably this has had a negative knock-on effect on the funding delivered through the Barnett Formula as local government is a devolved matter. But voters in Scotland have had effectively no agency over these Westminster decisions!


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