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Liberal Party NEC Statement - UK Council Funding and Section 114 Notices
The Liberal Party notes with concern the precarious state of Local Authority finances in the wake of the covid-19 pandemic and the threat of the issuing of section 114 notice’s, implying the bankruptcy of affected councils.

Reports suggest that despite an injection of 3.2 billion pounds in support from central government, local Councils still face an accumulated shortfall of a near identical sum as their incomes have collapsed.

Many councils have exhausted their reserves as they have tried to maintain public services after 10 years of austerity which has seen a reduction in central Government funding.

While the Liberal Party acknowledges that many authorities have acted competently and with due diligence in their financial management, some Local Authorities have failed to ensure best value in expenditure and income generation for their residents.

Faced with this situation the Liberal Party calls for the following measures:
  • A recovery fund, to be issued to authorities in risk of issuing section 114 notices, which can demonstrate financial difficulties not related to poor financial performance prior to the Covid-19 outbreak;

  • For poor performing authorities to be allowed to pursue the section 114 notice process. This will lead to extensive reviews of those authority's financial circumstances and central Government assistance, where there is proven need;

  • Publication this year of the Green Paper on Adult Social Care, which has been promised in 2017 and 2019, and a commitment from government to directly supplement funding to adult social services. Increases in spending in social care by local authorities is taking essential funding away from other Local Authority non-statutory services;

  • For the government to permit more a progressive Council Tax banding regime, and for all properties to be reevaluated from 1991 to 2020 values to ensure fairer relative distribution of the Council tax burden;

  • More freedoms for LAs to levy fees and charges without government interference; and provide guidance and incentives for LAs to introduce charges such as Tourist Taxes which the party see’s merit in. The UK remains one of the few remaining countries where Tourist Taxes are not collected by local authorities as a standard;

  • For government to launch arts and culture kick-start funds and commercial incentives to facilitate the transfer of arts and culture operational costs away from local authorities into independent charitable organisations.

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