Foreword by the Deputy Prime Minister
Our local government finance system is complex. Few people make the effort to understand it. Fewer still succeed.
This is unfortunate, because local government finance is important. It deals with huge sums of money and supports vital services. In considering how to reform it, we need advice from the technical experts, but we also want the views of councillors and people who work for or with local government. Above all, we want the views of those who use and pay for local services. These are the people who central and local government, working in partnership, exist to serve. The local government finance system must deliver for them.
To make the green paper as accessible as possible, we have kept it short and simple. For those who want to understand the detail of our proposals, we have produced supplementary annexes, which can be found on the DTLR web-site at www.local.dtlr.gov.uk
The green paper sets out clearly the aims of a good local government finance system. It explains why we are convinced of the need for reform. On most of the issues dealt with in this green paper (government grant to authorities, control of borrowings, council tax and business rates, fees and charges), we are clear what direction reform should take, but have a genuinely open mind on how far and how fast we should move. We shall not take final decisions until we have considered the green paper responses. We shall publish a white paper next year, setting out our decisions.
This green paper deals largely with England. The Cabinet of the National Assembly for Wales is issuing a separate consultation paper which considers the case for reform in Wales. Responses to both papers will inform future proposals for legislation.
Like any other green paper, this is a Government document. It sets out our views and proposals. But we have had a lot of help from others. The reviews of the revenue grant distribution system and capital finance regime were carried out within the Central Local Partnership. The proposals on the business rate have been discussed in detail with local government and the business community. The green paper also benefits from surveys of the attitudes of local authorities, businesses and council tax payers.
We want to continue as we have started, by gathering views and suggestions from everyone with an interest in local government and its work – educating our young people and supporting the elderly, building sustainable communities, which are healthy, clean and safe, with proper access to transport and jobs. Its impact may not be obvious, but the local government finance system affects the ability of local authorities to deliver in all these areas. The deficiencies of the local government finance system are a shared problem. They need a shared solution. It may not be possible to devise a local government finance system that satisfies everyone, but it will not be for want of trying.
John Prescott
Published 19 September 2000
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