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Public Accounts Committee reports on local authority funding cuts

10 June 2013

The Public Accounts Committee has published a report into the financial sustainability of local authorities, recommending central government takes further steps to assess the impact of funding reductions and reforms before the next spending review. Key issues highlighted were:

  • Procedures should be put in place to address situations where local authorities become financially unsustainable (something the committee views as being more likely in the current funding environment)
  • DCLG should enter into transparent dialogues with other government departments, local government and the public to assess which services local authorities should provide going forward as funding decreases
  • The impact of funding changes on individual local authorities should be assessed in more detail, given the significant variance in decreases in spending power suffered by local authorities – ranging from under 2% to 8.8%.

Clearly there is a financial imperative to make cuts quickly and efficiently but it is important to accurately assess the impact of such cuts before deciding on how they are to be implemented.

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