Memorandum by Surrey County Council (LGB
1. Surrey County Council welcomes this opportunity
to submit its views to the Committee. This submission addresses
each of the key elements of the draft bill on which the County
Council would like to submit its views for consideration.
2. The Council supports many of the proposed
relaxations in the regulatory regime. However we regret that the
Secretary of State proposes to create considerable reserve powers
to intervene in unspecified circumstances that could have the
effect of nullifying many of the measures. We are also concerned
that many of the measures could lead to residents and businesses
in some areas not only paying more for their own services but
also paying more towards the services for others.
3. The Council welcomes the proposals which
should enable authorities to make capital investment decisions
based on commercial assessment rather than searching for solutions
which can be made to fit within the current regulatory framework.
However, the reserve powers of intervention, which may be invoked
for national rather than local reasons reduce certainty and could
lead to a loss of confidence by both local authorities and the
private sector when considering long-term investment decisions.
The Council is also very concerned, as are its District Councils,
about the proposals to pool housing receipts which amongst other
things, could undermine the Councils' ability to support affordable
4. The Council does not see the need for
the proposals. Authorities are already scrutinised through an
external audit regime that examines the quality of financial administration
and passes judgement on, for example, the level of reserves and
the quality of budget monitoring. In particular, the proposal
for the Secretary of State to specify a minimum level of reserves
to be held by an authority is interference in a decision best
made by local members with the advice of the responsible financial
officer taking into account local circumstances.
5. The Council opposes the proposal to merge
Revenue Support Grant (RSG) and National Non-Domestic Rate (NNDR)
into a single Formula Grant. This proposal further erodes the
identity of NNDR as a local tax and is somewhat at odds with the
proposals on Business Improvement Districts. It will also reduce
funding in some shire districts as they will effectively receive
negative RSG which will be deducted from their business rates.
6. The Council welcomes the principle of
Business Improvement Districts (BIDs) but would have preferred
to see greater powers to levy local supplements to business rates
in order to support the local business community. In reality,
the Council believes there will be very limited take up of this
proposal due to the difficulty in gaining the necessary consensus
7. The Council supports the proposals for
rate relief for small businesses.
8. The Council welcomes most of the proposed
changes to Council Tax but has reservations about the proposal
to allow the Secretary of State to vary the number and ratio of
Council Tax bands. Revaluations are likely to have significant
re-distributional effects and an increase in the number of bands,
particularly the insertion of a band below the current band A,
will exacerbate those effects. An increase in the local tax base
and local revenue to support local services following local consultation
would be welcome. However the fear is that this would offset nationally
by the re-allocation of grant elsewhere, meaning people would
pay more for their own services, and contribute even more to services
in other areas. Transitional damping arrangements, whilst welcome,
do not provide long-term relief.
9. The proposal to remove powers to apply
the Council Tax benefit subsidy limitation scheme is particularly
10. The Council supports any opportunities
to charge for discretionary services and additional powers to
trade although the opportunities to take advantage seem limited.
11. The Council feels that the freedoms
so far proposed are quite restricted. Moreover, the Council is
not convinced that the current performance assessment criteria
are sufficiently robust to be used potentially as a measure to
exclude authorities from even those limited freedoms. An external
auditor's opinion on an authority's capability to handle the freedoms
would be more appropriate, recognising that additional freedoms
may have to be restricted in the case of authorities that cannot
demonstrate sound stewardship of their affairs.
12. The Council, operating as it does in
a two-tier area, has a long history of co-opting other councillors
and giving them voting rights on its committeeson its Area
Transportation Sub-Committees, its district Partnership Committees,
and now its Local Committees, and is likely to consider this for
its NHS Select Committee. Representatives of other organisations
have been invited to attend and speak, but not vote (the statutory
exception being the education representatives on the Children
and Young People Select Committee. The Council would prefer to
retain this distinction between the involvement of those democratically
elected, and those appointed or nominated, and sees no need for
the Secretary of State to become involved in the local schemes
as is envisaged in the Bill.
13. The Council supports the proposal to
give local authorities power to hold advisory polls, and provide
express freedom in the way such polls are conducted.