By Richard Johnstone | 21 June 2011
The government is attempting to keep council tax in England frozen next year by ensuring Whitehall pays for any new burdens imposed on local authorities.
It has beefed up guidance to government departments that requires them not only to justify any new duties and other bureaucratic burdens placed on councils but also to state how much they will cost and where the money will come from.
Previous governments have also sought to keep the pressure on council tax bills to a minimum by insisting that central government pays the costs of any responsibilities given to councils. However,local government minister Bob Neill, launching the revised guidance yesterday, said that the doubling of council tax between 1997 and 2010 was in part due to ‘central government imposed unfunded or under-funded burdens on local authorities’.
The Local Government Association has also argued that new burdens have not always been fully funded.
New Burdens doctrine: guidance for government departments provides information for any department proposing new burdens, which includes an ‘exhortation to authorities’ in speeches. It also includes the transfer of functions from central to local government.
A spokesman for the Department for Communities and Local Government confirmed that the doctrine would be applied to ‘all and any new burdens councils incur as a result of new policies introduced by government’, including those following the passage of the Localism Bill.
Whitehall departments must estimate the costs of implementation and any recurring costs for three years.
The guidance states that they must assess the impact of policies on council tax in each individual year: ‘Departments cannot argue that short-term costs will be offset against long-term savings. Only specific identified cost savings (rather than vague, non-specific, or unquantifiable savings) can be offset against identified costs.’
Once a cost estimate is made, it is to be discussed with the LGA.
Neill said: ‘The coalition government is committed to ensuring that the net additional costs of all such new burdens from central government policy or initiatives are fully funded to help keep council tax down.
‘The New Burdens doctrine sets out the factors that departments should take into account when considering the costs and savings to local authorities arising from changes to policies and programmes. It applies to all departments and covers all local authorities.’
The LGA has proposed introducing an impartial third party in the assessment of new burdens and introducing an automatic retrospective review mechanism on whether the funding provided has been adequate.
