Budget 2024: pothole boost welcomed, but warning over business rates as Lancashire councilors react

Lancashire county councillors have been counting up the costs and benefits of the budgetLancashire county councillors have been counting up the costs and benefits of the budget
Lancashire county councillors have been counting up the costs and benefits of the budget
The impact of the budget on local authorities and the services they provide has drawn a mixed analysis from some of Lancashire’s most senior politicians.

Leading figures from the political groups represented on Lancashire County Council broadly welcomed the additional funding announced in Labour Chancellor Rachel Reeves’ statement on Wednesday.

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However, those of a different political persuasion to her questioned the sufficiency of the extra cash promised for councils - and also warned of the potential knock-on effects on their coffers of other decisions taken in what has widely been seen as one of the most consequential budgets in more than a decade.

Rachel Reeves set out what she described as “a significant, real-terms funding increase” for local government next year - in the form of £1.3bn in additional grant payments to deliver “essential services”. She revealed that at least £600m would be reserved for social care and £230m earmarked to tackle homelessness and rough sleeping.

Ms. Reeves also announced a £1bn increase for under-pressure services for children with special educational needs and disabilities (SEND) - a six percent real-terms rise.

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As we revealed earlier this year, the cost just of transporting SEND pupils to school cost Lancashire County Council £8.4m more than it was expecting in 2023/24.

The Conservative run authority’s deputy leader - and cabinet member for resources - Alan Vincent said the extra investment was good news, but stressed that it was “ way less than the County Council Network were asking for to improve SEND provision”.

He also warned that another budget measure - to increase national insurance contributions for employers - could hit County Hall hard.

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“We believe that the national insurance costs that would otherwise have been borne by councils will fall on the government.

“But we may lose business rate income if hospitality is hit as badly as it might be and [if] other businesses fail,” County Cllr Vincent said.

At the end of the first quarter of the current financial year, the authority said it was forecasting a £7.6m overspend - and that was after almost £21m of savings actions and use of one-off funding to bridge what would otherwise have been a wider gap.

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However, Labour opposition group leader Matthew Tomlinson said he believed Lancashire residents would “welcome much that is in this budget”.

“The freeze in fuel duty, the £400 rise in old-age pension and the reduction in the price of a pint will all be particularly welcome - as will investments in our hospitals, local clinics and in our armed forces.

“As far as local government is concerned, I welcome the government's commitment to further support the work we do - especially in areas such as rebuilding crumbling schools, affordable housing and particularly with more money for pothole repairs,” County Cllr Tomlinson added.

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The Chancellor announced a £500m increase in baseline funding for roads maintenance compared to the current financial year.

John Potter, a Liberal Democrat county councillor for Preston, as well as the leader of the opposition on Preston City Council, said of the budgetary promises to local authorities: “Any extra money is always welcome, but the devil is in the detail.

“Is the money going to be short-term, one-off grants or proper sustained funding of our councils and the vital services they provide? We will wait and see.”

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Meanwhile, Green Party group leader at County Hall, Gina Dowding, accused the government of taking “a mere pigeon step” on funding for SEND and affordable housing - when “great strides are needed to meet the need for both”.

She added: “The Chancellor could have put an end to the 'right to buy' of council housing and stop selling off our public housing stock.

“Investment in council's public health budgets are proven to reduce demand on the NHS through preventing avoidable illness. These budgets should have been increased.

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“The quality of life of people with over £10m would not be affected by a one percent wealth tax, but it would make a world of difference for the rest of us who are dealing with NHS waiting lists, cold homes and poor public transport." Labour have missed an opportunity to close the inequality gap.”

On the right to buy, the government did announce a cut in the discount offered to tenants purchasing their council house property and also said local authorities would be able to retain the total amount raised from such sales as of next month in order to reinvest it in social housing.

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