Transcript Document
Kent Forum 24/11/11 Strategic Level Finance Lee Colyer Chair of Kent Financial Officers Association Issues for discussion • 1. Business Rate Proposals • 2. Medium Term Budget Projections • 3. Communication and Influence 1. Business Rate Proposals • Consultation closed • LG Bodies all disappointed with proposals • Was an opportunity to rebalance relationship between Local Authorities and Businesses • Difference between definition of ‘localisation’ • Proposals hinge on whether Councils can deliver growth above CLG forecast (not known) 1. Business Rate Growth • Appendix A shows taxbase per authority over past five years • Confirms: volatility with little or no real growth • Appendix B shows the yield totals • Confirms: yield has increased due to multiplier and reliefs which would be kept by Treasury • Any financial benefit will be limited but uncertain Questions • Can Kent deliver real sustained growth? • Will government take on board concerns and amend proposals? 2. Medium Term Budget savings • Context is important • First table shows the spend for each authority according to CIPFA stats • Budget Requirement column is the national and local tax burden to fund each authority (incl. local precepts) 3 Year Total Budget Gaps £TBC £3m £3m £11.4m £2.7m £nil £2.5m £1.7m £1.9m £3.9m £2m £1.5m KCC £240m Police £42m Fire £12m GT £330m £2.9m Impact on Kent Economy Medium Term • £330m of public expenditure lost • Expected 1,600 Job Losses Longer Term Factors will add more pressure • End of Council Tax Freeze Grants • 10% less grant when Council Tax Benefit ‘localised’ and exposure to increase in claimants • Withdrawal of New Homes Bonus • Government finances will need to be costed following higher inflation linked benefits and lower growth = more public sector funding cuts. Joint Approach • Knowing how and where savings are to be made is crucial for strategic planning • Proposals require political support before publishing • New era of tightening financial resources requires greater collaboration Positives • Good track record and networks in place • Locality Boards good opportunity to resolve delivery overlaps, decide who is now best placed to deliver • Kent received good Annual Audit Letters Communication and Influence • Kent authorities had grants cut by 28% • Good financial planning and delivering efficiencies mitigated most of the grant cuts • But, national data is hurting Kent Authorities • Inflation should be 2% but persistently high, this hits us hard on utility costs, contracts and fuel • National growth forecast have fallen well short which impacts on income streams • Localisation proposals have been disappointing and not fully funded - trust in Councils? • England has most centralised system of any OECD country (76%/24%) End and Questions?