Archived decisions

REPORT OF THE

Cabinet / Leader

PART I

CONSULTATION DOCUMENTS AND THE COUNTY COUNCIL'S RESPONSE

On 24 September and 29 October 2007, the Cabinet considered reports detailing the key headlines of several Government consultation documents, together with proposed draft responses. A brief summary of each report and the County Council's response is detailed below.

Housing Green Paper:

The Housing Green Paper outlines the Government's plans for delivering three million new homes by 2020. The Green Paper and its 11 supporting documents have three themes, namely:

    · more new homes (an increase of 20% to the annual house building target for England by 2016 is proposed)

    · better homes and creating places people want to live in (includes proposals to make homes greener with all new homes to be zero-carbon by 2016 with intermediate targets of 25% less carbon by 2010 and 44% less by 2013, and measures to cut water use in new homes by almost 20%)

    · additional affordable housing to rent or buy (includes proposals for an £8 billion programme for affordable housing for 2008-2011 and an increased target of 70,000 affordable homes per year in England by 2010/11)

    The Cabinet welcomed some elements of the Green Paper but expressed concerns in regard to other elements such as the impact on the environment and community cohesion of any local increase to the annual house building target, the categorisation of homeowners back gardens as brownfield sites, the provision of adequate infrastructure improvements, the standard of house building - important to ensure that past mistakes are not repeated, and the absence of any mention of increasing the amount of supported housing such as that for older people or those with learning disabilities. Furthermore, the Cabinet were of the view that the Government tries to exercise too much central control over standards which should be determined locally and that Councils would be able to do more on affordable housing if the Government provided adequate public finance and facilitated Councils using their housing and other property assets.

Formula Grant Distribution Methodology:

This consultation paper sets out options for changing the methodology used to calculate and distribute the revenue formula grant to local authorities for the three years from 2008/09 to 2010/11 and includes revenue support grant, the redistributed non-domestic rates and, for police authorities, the police principal grant. The paper covered issues which affect the County Council such as:

    · removal of the existing damping arrangements for children's and younger adults' personal social services

    · minor changes to the data used for personal social services for older people

    · updating the source data for the highways maintenance formula

    · formula changes for environmental, protective and cultural services to distribute additional funding for concessionary fares

    · changes to the geographical areas used in the area cost adjustment including dividing the existing Hampshire area into two

    · further judgemental changes to the level of needs and resource equalisation

    · tapering the level of floor damping over the forthcoming three year settlement period

    · changes to the basis of data for disability living allowance, income support, pension credit, day visitor numbers and council tax base

In agreeing the final response on the template supplied by the Government for responding to the 29 questions included in the consultation paper, a covering letter was also agreed which detailed a number of points the Cabinet wished to draw to the Government's attention, including:

    · the inadequacy of the four block model - its complexity, lack of transparency, and the scope for ministers to manipulate the results

    · formula grant should fund the basic cost of providing services, via the central allocation block, with the residue only being allocated towards the costs of deprivation. The allocation of formula grant towards deprivation costs should fully allow for the funding already directed towards deprivation costs through specific grants and allocations such as the Neighbourhood Renewal Fund

    · the formulae for personal social services should be subject to a fundamental review

    · Government support should be provided as far as possible as general formula grant, not as specific grants. The Dedicated Schools Grant should be reabsorbed into formula grant

    · Government funding support for borrowing allocations should be restored, either through the revenue formula grant system or by replacing them with capital grants

    · control over non-domestic rates should revert to local authorities

    · the County Council has one of the lowest formula grants per head, has lost substantial grant through resource equalisation and stands to lose further grant from the last formula changes if damping is removed. Services will be at risk and council tax rises will not be sustainable if the floor is unwound over the next three years of the Comprehensive Spending Review 2007 in a much tighter financial regime

    · changes introduced in 2006/07 to the formula grant damping arrangements resulted in a reduction in Government funding support for borrowing allocations. This support should be fully restored, either through the revenue formula grant system or by replacing the borrowing allocations with capital grants.

Dedicated Schools Grant Formula Review - terms of reference:

The broad framework for the review of schools, early years and 14-16 funding arrangements for 2008-11 was announced. The Dedicated Schools Grant (DSG) provides core funding for schools to local authorities and this will continue to be distributed in 2008-11 via the spend plus methodology, rather than a single formula. However, the Government invited local authorities, schools forums' and other stakeholders to comment on the terms of reference for a DSG formula review to look at its distribution in the longer term with the intention of producing a single transparent formula for use from 2011/12. The terms of reference set out the aims and objectives of the review and the detailed issues to be considered including Additional Educational Needs (AEN), high cost pupils, area costs, sparsity, early years, 14-19 funding and interactions with other specific grants including Schools Standards Grant (SSG) and Schools Development Grant (SDG).

The Cabinet welcomed some elements of the review but expressed concerns in regard to other elements; whilst the aim of the review is set out the objectives are not clear, and unlike previous reviews, the principles or characteristics expected of a successful formula are not set out. It is important that the criteria for developing the formula should be transparent and the resulting distribution capable of easy replication by local authorities or stakeholders. It should use data that is already collected which could describe characteristics of children within an authority's schools or the characteristics of an authority as a whole, and data should be robust in terms of collection, integrity and lifetime. In addition, it is not clear where children's social care funding fits into the review and the issue of the return of post 16 funding to local authorities from the Learning and Skills Council, expected in 2011, is also not considered and should be. Finally the review should also consider whether schools funding should continue to be channelled through DSG as a ring fenced grant. The Cabinet's position on this is that Government support should be provided, as far as possible, as general formula grant not as specific grants. The DSG should be reabsorbed into formula grant, as the continuation of ring-fenced funding of the schools budget runs counter to the objectives of the Children Act and the Government's proposals for integrating the funding arrangements for Connexions and 14-19 year old provision.