Parliamentary Search

Oral question asked in the House of Lords, by Lord Whitty (Labour). It was answered on Monday, 27 January 2025.

Local Government: Funding

Question

My Lords, first, I am sure that the whole House endorses my noble friend’s opening words. It is indeed a moving day.

On my Question, the biggest problem for local authorities is not structure or assessment. This Government and every other Government depend on local authorities’ ability to deliver many of their most important policies and strategies, and yet local government depends on an archaic system of local taxation—both council tax and business tax—and uncertain grants from central government. I hope the assessment that

my noble friend refers to will begin to change that system, but does my noble friend not agree that a fundamental assessment of what local authorities need should be introduced so that we can start to improve the financial position of local authorities before the end of this Parliament?

Answer

I thank my noble friend. For 12 of the last 14 years, I was a local government leader, so his words definitely strike home to me. The Government are committed to local authority funding reform, with the updated approach that I spoke about from 2026 to 2027. We need to fix the foundations that he spoke about, so this will be developed in partnership with the sector and based on the principle of giving councils early certainty of their funding and a much fairer funding picture across the country. We are inviting views on our principles and objectives for funding reform through a consultation. We want to do this in consultation with the sector, and that consultation closes on 12 February. We will move towards an updated system and possible transitional arrangements to determine how local authorities reach their new funding allocations.

Secondary information

Type
Oral question
Reference
843 cc1-3 
Session
2024-26
Oral question type
1st Supplementary
Chamber / Committee
House of Lords chamber
Subjects
Equality Local government finance
Link
View this Oral question on hansard.parliament.uk