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6 Dec 00

HOW MUCH FOR SERVICES IN POOLE NEXT YEAR

BOROUGH OF POOLE - STANDARD SPENDING ASSESSMENT 2001-2002

Poole has been recognised as one of the 35 worst funded Councils following the Government's announcement on Local Government funding.

As part of new proposals announced in November, the Government has outlined two possible options for Council funding for the coming year.

· Under the existing option Poole would receive £70.637million, an increase of only 2.5% in funding from the Government for local services. This compares to other Authorities who would receive increases of up to 10% under the current system.
· The second option puts in place a minimum 3.2% rise which would increase Poole's grant by an extra £500,000.

Brian Clements, Leader of the Council, said; "This is a tough settlement for people in Poole where the allocation announced means there is at least a £1.2million shortfall in the money needed to provide our services. Local people are rightly demanding that we give them good services but this becomes more difficult when expectations are raised and the funding needed is not provided. For example, the Government's announcement that Education will receive an 8.1% increase does not apply to Poole where only 4.1% additional funding has been given to us for our Schools."

"At the same time funding for important every day services for local people such as grounds maintenance and cleansing will not cover basic wage increases let alone the improvements in service. We have been talking to local people about our services on the basis of a 5% increase in Council Tax next year. The Government are expecting Councils to raise 6% more funding for services through Council Tax. If Poole does not receive the extra £500,000 proposed this could mean an additional 2-3% on our Council Tax straight away."

"Facing up to last year's bad settlement with a high Council Tax increase has put us in a better position to cope with a tough settlement this year but the situation has been made worse by the Government offering two options for funding. Until the full picture is known it will be hard to plan for services next year - but what ever happens, we will be faced with some difficult decisions."

Editor's Notes:

Currently grants are given to Local Authorities using a formula for 2001/2002 which include some data changes on earnings which favour London and population which favours rural as opposed to urban authorities. As a result, some Councils could receive an increase in grant of nearly 10% - others would be cut in real terms.

To reduce the difference between Local Authorities, the Government is proposing 'floors' and 'ceilings' which set a minimum 3.2% increase and maximum 6.5% increase in the grant from Central Government. This means that money will be taken from the 12 authorities who exceed the 6.5% increase (mainly based in London) and distributed to the 35 authorities receiving less than the 3.2% which include Poole and Bournemouth.

Further announcements on special grants for Transportation and Social Services are expected over the next few weeks. The Government will consult Local Authorities on the funding proposals until 9 January 2001 after which they announce their preferred option. Once Poole's final SSA has been announced, the budget and Council Tax for April 2001-March 2002 will be set in February 2001.

-ends-

Bob Jackson, Head of Financial Services, tel: (01202) 633105