Beruflich Dokumente
Kultur Dokumente
1
Liverpool City Council, Liverpool City Council General Fund Budget 2019/20, 25 February, 2019, pages 1-2,
paragraphs 1.1 and 1.3. See also: Liverpool City Council, City Council General Fund Budget 2019/20 & Capital
Strategy 2019/20 – Appendix A: Budget Decisions to be Delivered, 22 February, 2019.
2
Marc Waddington, “Mayor of Liverpool promises to resign if 60,000 people want him to”, Liverpool Echo, 25
October, 2012.
3
Bill Gleeson, “Why are more people dying on Merseyside?” Liverpool Echo, 7 October, 2017.
4
For example, Samih Kalakeche, Liverpool City Council’s former adult social care director, reportedly stepped-
down in 2017 over the scale of cutbacks. If the cuts continue, Kalakeche told the press, Liverpool City Council’s
“social services will not exist” in future years. See: Tom Belger, “Resigning council boss warns social care could
be completely axed”, Liverpool Echo, 6 February, 2017.
1
The Basic Plan
5
Total council tax for the city – which includes charges levied by precepting authorities – has increased (in
nominal terms) by 5 percent since 2018/19. Calculation below.
𝑇𝑜𝑡𝑎𝑙 𝐵𝑎𝑛𝑑 𝐷 𝑐𝑜𝑢𝑛𝑐𝑖𝑙 𝑡𝑎𝑥 𝑐ℎ𝑎𝑟𝑔𝑒 2019/20
𝑃𝑒𝑟𝑐𝑒𝑛𝑡𝑎𝑔𝑒 𝑐ℎ𝑎𝑛𝑔𝑒 𝑖𝑛 𝑡𝑜𝑡𝑎𝑙 𝑐𝑜𝑢𝑛𝑐𝑖𝑙 𝑡𝑎𝑥 𝑏𝑒𝑡𝑤𝑒𝑒𝑛 2018/19 𝑎𝑛𝑑 2019/20 = (( ) − 1) × 100 =
𝑇𝑜𝑡𝑎𝑙 𝐵𝑎𝑛𝑑 𝐷 𝑐𝑜𝑢𝑛𝑐𝑖𝑙 𝑡𝑎𝑥 𝑐ℎ𝑎𝑟𝑔𝑒 2018/19
£1,949.87
(( ) − 1) × 100 = 5 𝑝𝑒𝑟𝑐𝑒𝑛𝑡 𝑖𝑛𝑐𝑟𝑒𝑎𝑠𝑒.
£1,856.69
Values obtained from: LCC, Minutes of City Council Budget Meeting, 7 March, 2018, page 8; and LCC, Statutory
Calculations to determine Council Tax 2019/20, 6 March, 2019, page 4.
6
CIPFA, The CIPFA Financial Management Code (Consultation Version), 15 March, 2019, page 27, paragraphs
74 and 75. Elsewhere CIPFA notes that “most budgets remain annual plans covering a single year”. See CIPFA,
Looking forward: medium-term financial strategies in the UK public sector, October, 2016, page 9.
2
Buying Time with Usable Reserves
7
CIPFA, LAAP Bulletin 99: Local Authority Reserves and Balances, July, 2014, pages 9-10, paragraph 35.
8
Ibid., page 4, paragraph 22.
9
LCC, Medium Term Financial Strategy 2013/2014 to 2016/2017, 6 March, 2013, page 40, paragraph 14.1.
Furthermore, the Local Government Association (LGA) advises that reserves “restricted by local agreement to
fund certain types of expenditure” – like controllable earmarked reserves – “can be reconsidered or released if
the council’s future plans and priorities change.” LGA, A councillor’s workbook on local government finance,
March, 2018, page 24.
10
TUSC, Preparing a No Cuts People's Budget, 12 January, 2016.
11
London Borough of Lewisham, Council Meeting Agenda, 3 March, 2008, pages 974 to 976.
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could in principle “be applied on a once-off basis to support service
provision.” Whether general reserves should be used to oppose cuts
was “ultimately a judgement about the benefits of maintaining this
resource rather than applying it”, the CFO added.12
Such sentiments reflect a basic principle of local authority finance:
the level of reserves maintained by a council is a political decision.
CIPFA is clear on this point:
In the absence of prescriptive legislation it has always been
recognised that it should be a local decision to determine
reserve levels. … The assessment of ‘adequate’ and ‘necessary’
levels of reserves is a matter for local authorities to
determine.13
Similarly, a parliamentary briefing paper published in 2016
explains:
Under section 32 of the Local Government Finance Act 1992,
local authorities are required to maintain an appropriate level
of reserve funding. As with prudential borrowing, the
judgement as to an appropriate level of reserves lies with local
authorities: there is no formula to arrive at the ‘correct’ level.14
The fact that elected councillors have the final say on reserve levels
is important.15 So, too, is the fact that “general” and “controllable
earmarked” reserves can be used to balance an annual budget
provided the funding is replaced in future years. Taken together,
12
London Borough of Lewisham, Budget 08/09, 13 February, 2008, page 100 (Apendix Y3).
13
CIPFA, The CIPFA Financial Management Code (Consultation Version), 15 March, 2019, page 34, paragraphs
106 and 108.
14
Mark Sandford, Local government in England: capital finance, House of Commons Library, 2016, 27 June,
2016, page 8. Cited in Unison Leicester City, “No Cuts” Budget Proposal, February, 2017, page 8.
15
Although elected councillors must take account of the advice offered to them by their CFO, they are not
obliged to follow it. “The level of reserves and balances is principally the professional responsibility of the
[CFO] to advise members on. Members are not automatically obliged to accept this advice, but must pay due
regard to it and be satisfied that they have met their own statutory and fiduciary obligations if they are minded
to depart from the advice.” Lambeth London Borough Council, Revenue & Capital Budget 2010/11 to 2012/13,
8 February, 2010, page 19, paragraph 5.8. Similar statements can be found elsewhere. See, for example, Isle of
Wight Council, The Legal Framework Governing Budget Decisions, 21 February, 2007, paragraph 5: “Members
should have regard to the personal duties placed upon the Director of Finance as Chief Financial Officer. The
Council may take decisions which are at variance with his advice, providing there are reasonable grounds to do
so.”
4
both of these facts indicate that useable reserves can legally be
drawn down to temporarily stop Tory cuts, thus buying time for
councillors to mobilise a mass campaign to force this weak Tory
government into retreat – ending austerity and winning money
back from central government.
Liverpool City Council’s Usable Reserves
Through its 2.99 percent council tax increase for 2019-20 LCC will
draw in estimated additional revenue of £5.076M over the next
year.18
This tax hike can and should be reversed, with the resultant
shortfall of £5.076M to be met by drawing on usable reserves.
16
LCC, Statement of Chief Financial Officer on Adequacy of Provisions & Reserves 2019/20, 22 February, 2019,
pages 2 and 6.
17
LCC, City Council General Fund Budget 2019/20 & Capital Strategy 2019/20 – Appendix A: Budget Decisions
to be Delivered, 22 February, 2019.
18
𝐴𝑚𝑜𝑢𝑛𝑡 𝑟𝑎𝑖𝑠𝑒𝑑 𝑏𝑦 𝐿𝐶𝐶 ′ 𝑠 2019/20 𝑡𝑎𝑥 𝑖𝑛𝑐𝑟𝑒𝑎𝑠𝑒 = 𝐶𝑜𝑢𝑛𝑐𝑖𝑙 𝑇𝑎𝑥 𝑅𝑒𝑞𝑢𝑖𝑟𝑒𝑚𝑒𝑛𝑡 2019/20 − (𝐵𝑎𝑠𝑖𝑐 𝐴𝑚𝑜𝑢𝑛𝑡 𝑜𝑓 𝐶𝑜𝑢𝑛𝑐𝑖𝑙 𝑇𝑎𝑥 2018/
19 × 𝐶𝑜𝑢𝑛𝑐𝑖𝑙 𝑇𝑎𝑥 𝐵𝑎𝑠𝑒 2019/20) = £174,841,000 − (£1,602.16 × 105,960.17) = £5,075,854.03.
Values obtained from: LCC, City Council General Fund Budget 2018/19-2019/20, Capital & Investment Strategy
& Statutory Calculations to determine Council Tax for 2018/19, 23 February, 2018, page 17, paragraph 5.7; and
LCC, Statutory Calculations to determine Council Tax 2019/20, 6 March, 2019, page 2.
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Other Council Tax Charges
19
£52.066M − £21.112M − £5.076M = £25.878M
20
𝐴𝑚𝑜𝑢𝑛𝑡 𝑟𝑎𝑖𝑠𝑒𝑑 𝑏𝑦 2019/20 𝑖𝑛𝑐𝑟𝑒𝑎𝑠𝑒 𝑖𝑛 𝑃𝑜𝑙𝑖𝑐𝑒 𝑎𝑛𝑑 𝐶𝑟𝑖𝑚𝑒 𝐶𝑜𝑚𝑚𝑖𝑠𝑠𝑖𝑜𝑛𝑒𝑟 (𝑃𝐶𝐶) 𝑝𝑟𝑒𝑐𝑒𝑝𝑡 = (𝐵𝑎𝑛𝑑 𝐷 𝑃𝐶𝐶 𝑃𝑟𝑒𝑐𝑒𝑝𝑡 2019/20 ×
𝐶𝑜𝑢𝑛𝑐𝑖𝑙 𝑇𝑎𝑥 𝐵𝑎𝑠𝑒 2019/20) − (𝐵𝑎𝑛𝑑 𝐷 𝑃𝐶𝐶 𝑃𝑟𝑒𝑐𝑒𝑝𝑡 2018/19 × 𝐶𝑜𝑢𝑛𝑐𝑖𝑙 𝑇𝑎𝑥 𝐵𝑎𝑠𝑒 2019/20 ) = (£201.97 × 105,960.17) −
(£177.97 × 105,960.17) = £2,543,044.08.
𝐴𝑚𝑜𝑢𝑛𝑡 𝑟𝑎𝑖𝑠𝑒𝑑 𝑏𝑦 2019/20 𝑖𝑛𝑐𝑟𝑒𝑎𝑠𝑒 𝑖𝑛 𝑀𝑒𝑟𝑠𝑒𝑦𝑠𝑖𝑑𝑒 𝐹𝑖𝑟𝑒 𝑎𝑛𝑑 𝑅𝑒𝑠𝑐𝑢𝑒 𝐴𝑢𝑡ℎ𝑜𝑟𝑖𝑡𝑦 (𝑀𝐹𝑅𝐴) 𝑝𝑟𝑒𝑐𝑒𝑝𝑡 =
(𝐵𝑎𝑛𝑑 𝐷 𝑀𝐹𝑅𝐴 𝑃𝑟𝑒𝑐𝑒𝑝𝑡 2019/20 × 𝐶𝑜𝑢𝑛𝑐𝑖𝑙 𝑇𝑎𝑥 𝐵𝑎𝑠𝑒 2019/20) − (𝐵𝑎𝑛𝑑 𝐷 𝑀𝐹𝑅𝐴 𝑃𝑟𝑒𝑐𝑒𝑝𝑡 2018/19 × 𝐶𝑜𝑢𝑛𝑐𝑖𝑙 𝑇𝑎𝑥 𝐵𝑎𝑠𝑒 2019/
20) = (£78.84 × 105,960.17) − (£76.56 × 105,960.17) = £241,589.19.
𝐴𝑚𝑜𝑢𝑛𝑡 𝑟𝑎𝑖𝑠𝑒𝑑 𝑖𝑛 2019/20 𝑏𝑦 𝐿𝑖𝑣𝑒𝑟𝑝𝑜𝑜𝑙 𝐶𝑖𝑡𝑦 𝑅𝑒𝑔𝑖𝑜𝑛 𝐶𝑜𝑚𝑏𝑖𝑛𝑒𝑑 𝐴𝑢𝑡ℎ𝑜𝑟𝑖𝑡𝑦 (𝐿𝐶𝑅) 𝑝𝑟𝑒𝑐𝑒𝑝𝑡 = 𝐵𝑎𝑛𝑑 𝐷 𝐿𝐶𝑅 𝑃𝑟𝑒𝑐𝑒𝑝𝑡 2019/20 ×
𝐶𝑜𝑢𝑛𝑐𝑖𝑙 𝑇𝑎𝑥 𝐵𝑎𝑠𝑒 2019/20 = £19.00 × 105,960.17 = £2,013,243.23.
𝑆𝑢𝑚 𝑜𝑓 𝑎𝑏𝑜𝑣𝑒 𝑒𝑠𝑡𝑖𝑚𝑎𝑡𝑖𝑜𝑛𝑠 = £2,543,044.08 + £241,589.19 + £2,013,243.23 = £4,797,876.50.
Values obtained from: LCC, Minutes of City Council Budget Meeting, 7 March, 2018, page 7; and LCC, Statutory Calculations to determine
Council Tax 2019/20, 6 March, 2019, pages 3 and 4.
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Summary