“Councils anticipate cutting services to ‘legal minimum’ “

Owl says: But this was always the ambition of Conservatives who much prefer “the big society” (charities and volunteers providing services) and “the small state” (councils providing minimum services). We should not be surprised at that – it is what their voters vote for. But what we SHOULD be surprised at is that it is taking MORE of our money to achieve this, not less.

Labour councils are most pessimistic (83% believe this vill happen within 5 years), as they should be, as they are generally in poorer areas and/or the North where reliance on business rates (which will be the main source of council revenue with council tax) will be tricky, particularly in a post-Brexit economy. But Tory councils, even those in business rate-rich areas are also pessimistic (63%).

A sorry state of affairs to look forward to if this government remains in power: higher taxes, lower (rock bottom) services.

“Two-thirds of councils believe they will only be able to deliver minimum services required by law within five years.

The results of a survey by the New Local Government Network (NLGN) comes as Northamptonshire County Council voted through an action plan to cut services to the bone in order to tackle a likely budget deficit for this year of up to £60m–£70m.

NLGN’s second Leadership Index survey found that councils with social care responsibilities are the most pessimistic, with 88% indicating they will be unable to deliver discretionary services by 2023.

Adam Lent, director of the NLGN, said: “This should be a sober wake-up call for a government that is overseeing a country with ever deepening social divisions and growing inequality.

“Councils are best placed to tackle these problems, and should be receiving greater investment to do this, not seeing their services stripped to the bare minimum.”

Lent said areas stripped of libraries, park maintenance, pothole repairs and advice to residents on care, or housing, were likely to see a narrowing of opportunity for residents.

The survey was carried out from 7th June to 2nd July, with 191 council leaders, chief executives and mayors replying.

Labour-run councils are the most pessimistic with 83% predicting that discretionary services will disappear by 2023, compared to 63% of Conservative-run authorities.

Northamptonshire, on Thursday afternoon, approved an action plan that agreed “spending priorities”. These include safeguarding vulnerable children and adults. Also in the plan is a review of contracts with third party suppliers. Around 70% of Northamptonshire’s services are delivered through external suppliers.

Paul Carter, County Councils Network chairman and leader of Kent County Council, said: “It is clear that unless government finds a long-term solution to council funding and a fairer distribution of resources between authorities, other well-managed county councils could find themselves unable to balance the books.

“The new secretary of state for local government recognises the situation we face, but the Treasury needs to better understand the pressures we are under and support counties with short-term resources for the next financial year, ahead of a longer-term deal in the spending review.”

Northamptonshire will also review its external contracts, including Private Finance Initiative Schemes, as well as its capital programme.

Before the meeting, Andrew Lewer, Conservative MP for Northampton South, tweeted that the county council’s “problems are national as well as local”. He revealed he has written to communities secretary James Brokenshire and health secretary Matt Hancock to request a meeting about the authority’s position.

Pressure on the government to provide further assistance to Northamptonshire also came from Anne Longfield, children’s commissioner for England, who tweeted that her organisation was “writing to ministers asking for them to also ensure no vulnerable children are put at risk by cuts to services”.

It also emerged this week that East Sussex County Council last month agreed plans to reduce services to the bare minimum required by law.

Becky Shaw, chief executive, said: “Careful planning, efficiency savings, innovation, hard work and commitment to our four key priorities have enabled us to make the best use of our dwindling resources, but the pressure created by local residents’ needs cannot be met by income raised locally.

“Having transformed our services and saved £129m since 2010, we need to be realistic about what further budget cuts will mean for the residents, communities and businesses of East Sussex.

“Our core offer paints an honest picture of the minimum that we realistically need to provide in the future and we want to use this as the basis for discussion with the government, partner organisations and residents in East Sussex.”

The Times reported this week that the chancellor, Philip Hammond, has told non-protected departments, including the Ministry for Housing, Communities and Local Government, to earmark further cuts before next year’s spending review.

Some departments believe that these budgets could be cut by as much as 5%, according to the report.”

http://www.room151.co.uk/funding/councils-anticipate-cutting-services-to-legal-minimum/

“Next CEO Lord Simon Wolfson says business rates accelerating ‘process of failure’ on the high street”

Lord Wolfson does not mention a transaction tax on online purchases – not surprising as Next has a big online presence too.

“The chief executive of Next has called on the government to reform business rates, which he says are accelerating the rate at which high street shops close.

Lord Wolfson, a Conservative Party peer, says the tax on commercial property has not been updated to reflect the increasing popularity of online shopping and needs changing.

“The one thing that I think the government must do is make rates more responsive to today’s reality,” Simon Wolfson told ITV News.

“Let the thriving towns and cities, we should be paying high rates, but the ones that are dying, actually that process of failure is being accelerated by rates that are stuck at levels that don’t reflect today’s reality”. …”

“Companies got just £21million relief from business rates this year as councils are urged to do more to help ailing high streets”

Owl says: You want to see a conflict of interest in action? Here’s one. Should a council agree to business rate reductions to save their high streets and see their own revenue fall – or should they let the shops die to preserve their income? (Empty shops usually get 3 months free of business rates then have to recommence them even if the shop remains empty).

“Councils are failing to use their powers to cut business rates and help struggling local shops survive.

Local authorities can reduce rates if it is felt necessary to rejuvenate town centres, using rules under the 2011 Localism Act.

But analysis by the Altus Group consultancy reveals that this almost never happens. There were only £21million of reductions in this financial year – or 0.08 per cent of the predicted total £24.8billlion rates bill in England.

Although business rates are set by an independent government body, half the tax raised goes to councils.

Critics warned that their short-term focus on raking in money could end up destroying town centres weighed down by huge tax burdens.

The 50 per cent of rates that councils keep is meant to come with a more responsible attitude to businesses, with authorities cutting taxes where necessary to help firms.

But instead of going down, rates are constantly ratcheted up. Department stores have been hit with an average increase of nearly £151,000, or 27 per cent, in the past two years, while small shops have seen average rates climb 9 per cent to £9,623.

Sam Dumitriu, of the Adam Smith Institute, a think-tank, said: ‘Councils would rather prioritise their chief executives’ salaries over lessening the burden on businesses. There needs to be quite radical reform of rates to support businesses.’

Mike Cherry, chairman of the Federation of Small Businesses, said: ‘Local authorities must get to grips with the dire situation currently sweeping the high street and start backing hard-working retailers being hit hard by crippling rates bills.’

Robert Hayton, head of business rates at Altus, said: ‘Despite the ongoing crisis engulfing our high streets, this year councils in England are planning just £21million in additional help.

‘Given the stream of collapses across the retail and hospitality sectors since the turn of the year – and with many others teetering on the brink – councils could take decisive action now.’

The Daily Mail’s Save Our High Streets campaign is calling for business rates to be reformed, car parking charges to be slashed and huge foreign technology companies such as Amazon to be fairly taxed.

Around 50,000 retail staff have lost their jobs this year and almost 61,000 stores closed between 2012 and 2017 as internet retailers ruthlessly out-compete traditional bricks and mortar companies.

The Local Government Association, which represents councils, said: ‘Councils do what they can to help small businesses and local economies.

‘This is increasingly difficult, with local government in England facing an overall funding gap that will reach almost £8billion by 2025 and growing demand for services.’ “

http://www.dailymail.co.uk/news/article-5927309/Companies-got-just-21million-relief-business-rates-year.html

“PARK AND THRIVE Councils urged to slash parking fees to £1 in a bid to rescue failing town centres”

“GREEDY councils were last night urged to slash high street parking rates to a token £1 to stop town centres turning into “ghost towns”.

A retail veteran said town halls should introduce the nominal charge for the first two hours of parking in a radical 25-point plan to revive the retail sector.

The charging regime could be backed by Government legislation.

Bill Grimsey – ex boss of Wickes and Iceland – also demanded the “broken” business rate regime be scrapped altogether as he blamed the eye-watering tax for the biggest wave of shop job losses since the credit crisis.

He called for business rates to be replaced by a 2 per cent sales tax that would cover “bricks and mortar” chains such as Tesco as well as online giants such as Amazon.

And he called for Theresa May to create a new Town Centre Commission to develop a 20-year strategy.

He said: “The first six months of 2018 have seen the highest rate of retail closures, administrations for more than a decade and there is no sign of a slowdown.

“Our cities, towns and communities are facing their greatest challenge in history, which is how to remain relevant, and economically and socially viable in the 21st century.”

Speaking at the Local Government Association today, the retail veteran will say the days of shops ‘anchoring’ high streets were now gone as shopping habits change.

And he called on Government to change planning laws to bring in more housing and offices.

Libraries and public spaces should be at the heart of each community, Mr Grimsey said. He added that the vacancy rate – or proportion of empty shops – in towns such as Morecambe was now 30 per cent.

Councils trousered a whopping £820 million-worth of profit from parking and fines in 2016-2017.

The Local Government Association claims the so-called parking charge surplus is spent on “essential transport projects”. But a report in April ranked Britain’s roads 27th worst in the world – below Chile, Cyprus and Oman.

Under Mr Grimsey’s plans, councils would charge a nominal £1 for the first two hours of parking in town centres – while introducing 30 minutes free parking in high streets.”

https://www.thesun.co.uk/news/6689229/council-bid-slash-parking-fees-town-centres/

“Retail space returned to landlords in high street crisis, Colliers International reveals”

Owl says: would Tesco be calling for a “level playing field” between high street and online shopping if they had not just closed Tesco Direct – their online retailer!

“Retail space equivalent to about 180 football pitches has been handed back to landlords this year, in a stark sign of the challenges facing the high street.

A day after House of Fraser announced that it would be closing more than half of its stores, an analysis by Colliers International shows that 11.6 million sq ft of retail has been “lost” to administrations, company voluntary arrangements and planned store closures this year.

The property consultancy said that this included the two million sq ft of retail space that Marks & Spencer planned to offload by closing 100 stores.

Fears are growing for the future of high streets as more retailers struggle and try to close stores through CVAs — the contentious insolvency process that allows retailers to shut shops and cut rents at landlords’ expense. New Look, Carpetright and Mothercare are among those that have entered into CVAs this year and House of Fraser’s proposed CVA has infuriated many in the property industry. The British Property Federation, which lobbies for landlords, has called for an urgent inquiry into the practice.

However, retailers say that they are facing a toxic mix of high rents, rising wages and costs and a structural shift in the industry as more people shop online. Yesterday, Dave Lewis, chief executive of Tesco, told the BBC that the burden of business rates, which hits retailers with large store estates hard, was to blame for many of the present woes.

He said that Tesco paid more than £700 million a year in business rates and that “you need a level playing field . . . between an online digital world and a traditional retail store base model”.

Dan Simms, co-head of retail agency at Colliers, said that the retail space at risk of closure this year was already more than the 10.7 million sq ft handed back in 2016, the year BHS collapsed.

“What we are seeing now are a lot more retailers closing stores,” he said. “It is much more broadly based so it feels like things are markedly worse.”

Analysis by Harper Dennis Hobbs shows that about 25 million sq ft of retail space was lost between 2008 and 2010 …”

Only in the Sunday Times …

… would you find an article with the headline:

“Small businesses at risk from house price fall”

about small business owners using their homes as collateral.

Might a headline in the Daily Mirror read:

“Small business owners forced to use houses as collateral as big banks fleece them with high interest rates and government fleeces them with high business rates”!

“Trying to maximise income purely from commercial revenues is NOT what the public want.”

CIPFA chief executive Rob Whiteman has told a conference this morning”

“… At some point in the next 15 – 20 years local government needs to be reorganised. We need to be aware reorganisation would be a good thing.”

But he predicted there was unlikely to be “any meaningful local government reform” for some time.

Local government must rebuild trust with the public, Whiteman told his audience. “In its present form, local government is not perfect.

“I do not think that trying to maximise income purely from commercial revenues is what the public want.”

Don Peebles, head of CIPFA UK policy and technical, echoed this, suggesting local government’s commercial investments should be more about keeping council finances afloat rather than maximising profit.

He said recent changes to the prudential code – the statutory guidance for local government on borrowing and investments – reflected that “the priority is not maximisation of return but the protection of capital”. …”

https://www.publicfinance.co.uk/news/2018/05/local-government-uncertain-place-10-years