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the end of ring fenced budgets

20 October 2010

The Chancellor has announced as part of the CSR the end of ring fenced budgets for Local Authorities. Local Authorities currently receive in excess of 90 ring fenced budgets. This will be reduced to less than 10 (covering matters such as schools, fire, police and public health).

This decision, combined with the abolition of Local Area Agreements, which required reporting on prescribed performance indicators to central government, is part of the Government’s Localism agenda – putting power back in the hands of local people.

The move towards local priorities does raise the question as to how matters of national interest and importance will be dealt with. The Government’s current answer seems to be that such issues should be dealt with through incentivising local authorities and local communities to provide such services – but many will question whether cash incentives (for example, those announced today around the New Homes Bonus) will really work.

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