12 November 2004
The announcement of the provisional revenue support grant settlement has been postponed, leading to suggestions that councils could be in line for a funding increase.
Senior local government sources told Public Finance that ministers have put back the expected announcement date from November 16 – the date pencilled in by government officials – until the week beginning November 29.
The delay could have been triggered by technical or data collection problems, but there is speculation that a last-minute funding increase is being negotiated to take the pressure off sensitive areas such as council tax and policing.
The government is understood to be keen to maximise the political impact of the funding settlement ahead of the general election. Having the settlement follow the Queen's Speech debates and precede the pre-Budget report, expected in early December, would allow ministers to make the most of any funding increases, one source suggested.
The postponement has thrown local authority preparation into chaos. 'A lot of people don't know whether to cancel meetings or not,' the source said. 'Briefings will have to be changed.'
A late settlement leaves councils with little time to consider their options. Top-tier authorities are obliged to inform the Department for Education and Skills of their intention to passport funds to schools by December 31 – an immovable deadline.
A spokeswoman for the Office of the Deputy Prime Minister refused to confirm a date for the settlement but said it was unlikely to be next week and would be announced 'within the next few weeks'. She added: 'We don't recognise talk of delay when no date has been announced to be delayed.'
PFnov2004
