On behalf of its membership, the cross-party LGA regularly submits to Government
consultations, briefs parliamentarians and responds to a wide range of parliamentary inquiries. Our recent
responses to government consultations and parliamentary briefings can be found here.
Local audit and local auditors need to be adequately skilled and have an adequate understanding of local government. It also needs to focus on areas that add value rather than on work that is not a priority for local government. It has previously been highlighted (for example in the report of the Redmond review) that many believe that the current focus on asset and pension valuations is inappropriate.
Property continues to provide a good basis for a local tax on business. Business rates is efficient to collect and has been relatively predictable and buoyant in recent years. However, the changing nature of business alongside the nature of demand pressures on councils means that we cannot look to business rates to form such a substantial part of local government funding in the future and alternative means of funding councils will be needed instead of or as well as a reformed business rates system, of which one example is a tax on online businesses.
The consultation and its proposals are wide ranging. In our response we will only comment on aspects of the consultation document that are of direct interest to local government.
It will be important that this funding is kept under review to ensure it is enough to meet demand and that guidance is published as soon as possible so that councils can set up schemes and ensure the new funding reaches businesses. Any new burdens due to administrative or IT costs should also covered by the Government.
While we do not agree with some of the recommendations of the Redmond Review, and others need further consideration, in our response to the review we outlined that a number of quick actions should be taken as soon as possible to have an immediate effect on the audit market.
The changes in the 2003 Local Government Act and 2003 Capital Finance Regulations that introduced the Prudential Code were a major step in freeing local government from centrally imposed borrowing controls
The Treasury Management Code of Practice (“Treasury Management Code”) was introduced in 2001/02. Local authorities are required to “have regard” to the code in setting up and approving their Treasury Management arrangements.
We agree that the current system for the payment of schools’ business rates could be rationalised, although something like the proposed system is currently used in some unitary authorities for maintained schools. We also note that the proposed system would not alter the liability for business rates and also that it will still be part of school funding formulae and will have to be accounted for as part of schools’ accounts.