Councils face a period of uncertainty after general election, says CIPFA head

12 Jun 17

Local government faces greater uncertainty because of the current political situation after the general election last week, the head of CIPFA has said. 

Rob Whiteman, chief executive of the institute, said councils could not be sure now if government policies, such as changes to the education funding formula, would go ahead as planned.

He told Public Finance: "Local government is now facing a greater period of uncertainty after the inconclusive result of the general election last week."

Whiteman explained to delegates at CIPFA's 2017 local government conference in London today: "Indeed we may now have a period of uncertainty, does the fair funding formula go ahead? Does rate retention go ahead in the way we expected?

"I think this government is going to get really bogged down in Brexit," he added. 

Whiteman also said councils were unlikely to get any more money if austerity slows down and believed Labour's surge in support had shown the public had had enough of spending cuts and public sector pay could be affected as a result. 

"There is a question mark about austerity now. Can a minority government put through more measures of austerity? I think the answer to that is probably 'no', he explained. 

"I don't necessarily mean that is good news for local government, I'm afraid."

Whiteman added: "It could be that there is movement on pay, particularly with inflation rearing itself a little bit but actually your [local government] resources don't budge so you could potentially be in a more difficult position."

He said the domestic priorities would remain the NHS, housing and social care. He said local government was "bottom of the priority list".

On the issue of Brexit he said he doubted whether Theresa May's so-called 'hard Brexit' approach of leaving the single market, customs union and ending freedom of movement would be pursued.

He said: "I suspect that's now in question, even though negotiations begin next Monday, she is in a minority government with a supply and confidence deal with the DUP so her own backbenchers and indeed the backbenchers of the Labour party are likely to exert their muscle a bit more."

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