Another year, another budget. So what have we learnt from the contents of the infamous red brief case? Here are some of the highlights for the local government community.            

George the Builder

Fixing the roof whilst the sun is shining has become a well worn phrase for George Osborne. Now the economy is improving he has decided to take his love of manual labour to a new level by building whole homes. The government has created the privately funded Housing Finance Institute (“HFI”) to help local authorities bridge the housing gap. The aim of the HFI is to facilitate the delivery of an average of 55,000 new affordable homes each year until 2020 (at a cost of £2 billion) by providing local authorities with the skills and knowledge they need.

A New Lease of Life

Since the last election we have often been told ‘we are in this together’. The Local Government Association and partner organisations in Scotland, Northern Ireland and Wales, will now be experiencing this in a literal sense as the government launches a platform to advertise spare central and local government space to businesses, individuals and community groups in the most efficient way.

Not So Grim Up North

Last month the Greater Manchester Combined Authority (“GMCA”), in conjunction with its partners, was given control over health and social care for the region. The Budget has allowed for further devolution so the GMCA will be able to keep the full amount of business rate growth, allowing the region to decide how to use the funding. There is potential for this to lead to full business rate devolution with councils being able to keep the total revenue collected through business rates. A number of other local authorities are now piloting similar schemes which suggests this deal may become more widely available.

Leeds will not benefit from the business rate measures but has been given increased control and autonomy over transport, skill and business support. West Yorkshire Combined Authority has been given powers similar to those previously agreed with South Yorkshire, in order to improve the economy and job creation. Additionally, tech incubators will be set up in Manchester, Leeds and Sheffield in order to stimulate growth and support the development of innovative businesses across the North.

Finally, two pilots will be launched in Leeds City Region and Greater Manchester in 2015-16, to trial local sharing initiatives in the areas of shared transport, shared public space and health and social care.

Digital Ambition

Twenty five years following Madonna’s Blond Ambition tour we now have the government’s ‘Digital Ambition’ (probably unrelated). The Department for Communities and Local Government and the Government Digital Service will work with local authorities to create and implement proposals for digitally-enabled and efficient local services.

It’s hoped that this will enble public sector services to be delivered a more ‘joined-up’ manner which will better meet the needs of stakeholders. This approach should also facilitate better data sharing between central government and local authorities.

What Now?

So what does the budget tell us about the future of local government? Although some of the specific measures may not have been expected, if we look at the purpose of the above we can see they reflect underlying trends namely: 

  • a growing consensus regarding the need to increase the number of new homes built;
  • making best use of public assets;
  • increasing independence of certain local authorities in England; and
  • the continuing march of digital technology. 

We’d suggest that all these trends are likely to persist in the short to medium term almost irrespective of the results of the coming election. It’s therefore likely that the next five years will be filled with a host of new challeges and fortunately local authorities are unlikely to get the offer of ‘deal or no deal’.