IRRV Alert - week ending 1st December 2017
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Reforming Local Authority Needs Assessment: research published
Reforming Local Authority Needs Assessment: research published
The Communities and Local Government Committee publishes independent analysis suggesting ways in which the current needs and funding assessments for councils could be made simpler and more transparent
- Letter from the Chair to the Secretary of State (DCLG) relating to reforming local authority needs assessment research, 28 November 2017 (
PDF 610 KB)
- Business rates retention inquiry
- Communities and Local Government Committee
Read the research
- Summary ( PDF 452 KB)
- Simplifying the Needs Assessment Formula ( PDF 976 KB)
- Simplifying the Funding Model ( PDF 773 KB)
- Annex to Paper 1 – Simplifying the Needs Assessment Formula and Paper 2 – Simplifying the Funding Model ( PDF 529 KB)
- Review of Needs Assessment Data Sources ( PDF 480 KB)
- Business Rates Retention and the Reset ( PDF 892 KB)
Fair Funding Review
The research is aimed at contributing to the Government's Fair Funding Review and the work implementing 100 per cent retention of business rates for local authorities.
The analysis suggests a method for simplifying the needs assessment formula – reducing the number of indicators used – and for simplifying the wider funding model that translates these assessed needs into funding. The research also reviews the data that is used in the calculations.
It also assesses the implications of two potential models for the on-going 'resetting' of the funding system in light of the introduction of 100 per cent retention of business rates for local authorities.
Formulating a simple, transparent and fair funding system
Clive Betts MP, Chair of the Committee, said:
"Councils are currently facing an uncertain future when it comes to funding with current settlements coming to an end in 2020.
The Secretary of State told us when he appeared before the Committee in October that the Government was committed to a review of the funding formula and the implementation of 100 per cent retention of business rates for councils.
We hope that Ministers will find this a useful piece of research and that it makes a value contribution to the debate on how best to formulate a funding system that is both simple, transparent and fair."
Scope of the research
The research was undertaken by public sector funding and financial management specialists LG Futures.
The Committee requested research exploring:
- A potential approach to simplifying the current needs assessment formula
- Options for simplifying the wider funding system;
- The timeliness of the data sources used in the current needs assessment formula;
- A comparison of potential approaches to the 'reset' – 'fixed period' or 'rolling' – of the business rates baseline
Read the full report: Reforming local authority needs assessment.