Local Government Finance Reform

The Government is reviewing how local authorities are funded. It is doing this in two parts: part one is the proposal that local councils should retain a greater proportion of the National Non-Domestic Rates, commonly known as business rates; part two relates to proposals on the Community Budget. The proposals are important to the local voluntary and community sector because:

• they are likely to affect a significant proportion of local voluntary and community organisations funded directly or indirectly by local government;
• changes to local government finances are likely to have a direct impact on local services and therefore on local communities;
• any potential change in the funding of public services is likely to affect the demand on services provided by local voluntary organisations;
• local authorities are key partners for the sector and therefore any significant change for the local authorities is bound to have some impact on the sector.

NAVCA has produced a two page summary which gives a brief overviewof the proposals, potential implications and NAVCA's response. We have also produced a more detailed analysis. and have responded to the consultation. We have also responded to the technical consultation, outlining concerns that these proposals could incentivise councils to end discretionary relief.  

For more information read the Local Government Resource Review: Proposals for Business Rates Retention - Consultation and their plain English Guide.