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Local services like social care and child protection face deep 12 per cent cuts, LGA warns Local services like social care and child protection face deep 12 per cent cuts, LGA warns
(2 days later)
Services funded by local councils face deep budget cuts of around 12 per cent next year, according to the body that represents local government.Services funded by local councils face deep budget cuts of around 12 per cent next year, according to the body that represents local government.
Social care, housing, libraries, and bin collections – which are all managed by councils – could be affected if cuts of £3.3bn from central government grants go ahead.Social care, housing, libraries, and bin collections – which are all managed by councils – could be affected if cuts of £3.3bn from central government grants go ahead.
“Core local government funding has been protected from further in-year cuts in the Budget but it is clear the Spending Review in the autumn will see councils continue to face challenging funding reductions and spending pressures over the next few years,” said Local Government Association chair David Sparks.“Core local government funding has been protected from further in-year cuts in the Budget but it is clear the Spending Review in the autumn will see councils continue to face challenging funding reductions and spending pressures over the next few years,” said Local Government Association chair David Sparks.
“Councils have already made £20 billion in savings since 2010 following reductions in government funding of 40 per cent and have worked hard to shield residents from the impact of funding cuts."“Councils have already made £20 billion in savings since 2010 following reductions in government funding of 40 per cent and have worked hard to shield residents from the impact of funding cuts."
Local authorities are also severely restricted in their ability to raise council tax, meaning it will be near-impossible to raise money locally to replace grant reductions.Local authorities are also severely restricted in their ability to raise council tax, meaning it will be near-impossible to raise money locally to replace grant reductions.
Under rules brought in under the Coalition they must hold a referendum to raise council tax significantly – meaning in practice it does not happen.Under rules brought in under the Coalition they must hold a referendum to raise council tax significantly – meaning in practice it does not happen.
If the pattern of previous rounds of cuts is followed again, reductions are unlikely to fall evenly across the country.If the pattern of previous rounds of cuts is followed again, reductions are unlikely to fall evenly across the country.
According to an analysis by the Institute for Fiscal Studies published in March, local authorities in poorer areas have been forced to slash spending more drastically than those in wealthy areas.According to an analysis by the Institute for Fiscal Studies published in March, local authorities in poorer areas have been forced to slash spending more drastically than those in wealthy areas.
One of the most controversial parts of the Conservative manifesto was to cut benefits for the working age poor by £12 bn over the next three years. But during the campaign they only said where £2 bn of these savings would come from. That leaves £10 bn still to find. Some experts think the only way they can close that gap is by means testing child benefit – with millions of families losing out
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The Tories will increase the threshold at which the 40p rate of tax becomes payable to £50,000 by 2020. They haven’t said so but it is also likely that at some point in the next five years they will abolish that 45p rate of tax altogether for the highest earners. They also want to increase the effective inheritance tax threshold for married couples and civil partners to £1m
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The next two years are going to be dominated by the prospect of a referendum on Britain’s membership of the EU. First off David Cameron has the daunting task of negotiating a deal with other EU leaders an acceptable deal that he can sell to his party so he can go into the referendum campaigning for a ‘yes’ vote. This may be unachievable and it is possible that the Tories may end up arguing to leave. Opinion polls show Britain is divided on EU membership, one poll this year showed 51% said they would opt to leave compared to 49% who would vote to stay in
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Having won the election the Tories now have a mandate to go further and faster reforming the NHS. In order to make cost savings there is likely to be greater private involvement in running services, while some smaller hospitals may lose services they currently provide like A&E and maternity units
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The Tories plans to create 500 new free schools and make 3,000 state schools become academies. They will also carry on reforming the Department of Education and remove more powers from local authorities over how schools are run
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Government spending on renewable energy is under real threat now the Lib Dems are no longer in power with the Tories. Subsidies are likely to be slashed for off-shore wind farm and other green energy supplies. Meanwhile there will be generous tax break for fracking as ministers try and incentivise the industry to drill for onshore oil and gas
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In the campaign the Tories pledged to double the amount of free early education for three- and four-year-olds from 15 hours a week to 30. The extra hours would only be offered to working families where parents are employed for at least eight hours a week. However they have not said where the money will come from to fund the pledge
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The Tories want to slash business regulation, merge regulator and cut costs. The Lib Dems stopped them from reducing the employment rights of workers in power – but these are now under threat
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Regionally, the fall in council spending in the North East of the country has been double that in local areas in the affluent South East.Regionally, the fall in council spending in the North East of the country has been double that in local areas in the affluent South East.
The LGA says efficiency savings at authorities have already been made in previous rounds of cuts and that further reductions will almost certainly affect services.The LGA says efficiency savings at authorities have already been made in previous rounds of cuts and that further reductions will almost certainly affect services.
The Government says the estimates are “premature” and that the Treasury would listen to the views of local councils when it decided where to make cuts.The Government says the estimates are “premature” and that the Treasury would listen to the views of local councils when it decided where to make cuts.
 “These unsubstantiated and premature claims are based on funding decisions which have yet to be made let alone announced,” local government Minister Marcus Jones said. “These unsubstantiated and premature claims are based on funding decisions which have yet to be made let alone announced,” local government Minister Marcus Jones said.
“Councils have worked hard over the past five years to deliver a better deal for local taxpayers, however, like the rest of the public sector will have to continue playing their part in tackling the deficit to ensure the economic recovery continues.“Councils have worked hard over the past five years to deliver a better deal for local taxpayers, however, like the rest of the public sector will have to continue playing their part in tackling the deficit to ensure the economic recovery continues.
“In the run up to the Spending Review and next local government settlement we will continue to listen to the views of councils, Local Government Association and others about the best way of distributing funding to achieve fairness, efficiency and local growth.”“In the run up to the Spending Review and next local government settlement we will continue to listen to the views of councils, Local Government Association and others about the best way of distributing funding to achieve fairness, efficiency and local growth.”
As an unprotected department, DCLG is likely to face deeper cuts than the public sector on average.As an unprotected department, DCLG is likely to face deeper cuts than the public sector on average.