The summer is here but this is usually a busy time for finance departments as they gear up for the next budget. Richard Harbord says the burden of producing lawful finances along with the complexities of what may or may not happen with business rates combine to undermine the message of even the most persuasive book on positive thinking.
It is a statement of fact that everything conspires against the section 151 officer. The summer and Christmas tend to be peak times for activity, however well you plan. The evidence? A number of authorities still seem to be assisting auditors with their enquiries and it is time to start the detailed processes for the 2018-19 budget.
Comfort seems in short supply. I have just read a new management guide on positive thinking, but its lessons don’t seem to have worked. Everywhere I look there are difficulties. I repeat an earlier plea that this is the time for leadership. Regrettably, that seems to be the last thing available centrally; the only way forward is fudge and muddle.
It has not been an easy few months for chief officers in local authorities. It is difficult to be precise, but it seems to me that a larger number than usual have found themselves in difficulty and departing their posts. I am sure that part of this is down to the difficulties of maintaining workable but smaller budgets and meeting the aspirations of elected members, never easy at the best of times.
And when times are hard it is vital for finance officers that professionalism comes to the fore. I fear conflict with elected members will increase, especially in election years, as it becomes increasingly difficult to afford things held dear by councillors, things that they quite rightly believe their electorate would like to see. The pressure to achieve a lawful budget with adequate provisions has become an enormous burden.
I would quite like to see some research into people leaving authorities other than by choice. The question of accountability and responsibility are very important. This includes a look at the relative positions of officers and elected members.
Future shocks and resets
The difficulty of future resources remains. The minister for local government said last week that centra government still intended to go for greater business rate retention and said that much could be done without primary legislation. I am not sure that this is correct, but it depends on your definition of what’s to be done.
The work on the fair funding formula is definitely continuing and that must mean a reset to the existing retention scheme when that is complete. Probably around 2020-21. I suspect this will be a total reset rather than a partial reset. There will, as always, be winners and losers and that may require some kind of transition. I am all in favour of this. I believe these things should be as complicated as possible, preferably so only finance can understand the full effects.
Though, officers should beware of attracting to much attention. There has been considerable difficulty over the implementation of the new business rate relief schemes and government has blamed local authorities for slowness in applying the reliefs, though the difficulty has been the software used for the relief calculations. There now seems to be an agreed date and reliefs will be applied swiftly after that. I can’t help feeling that many businesses are going to be disappointed at the size of their relief.
That will only add to the frustrations surrounding business rates. There is considerable anger and concern at the workings of the new appeal system for business rates. Because of the new system having built in delays before an appeal can formally be made it is not so transparent as the old system and tracking appeals will be even more difficult. It seems the ability to actually make an appeal is limited to the ratepayer and agents are having to work in clients offices to achieve access to the Valuation Office Agency on behalf of their clients. This is bizarre as is the limited access local authorities have to the appeal system.
This weekend the chancellor said, when asked about giving financial help for local authorities faced with the cost of checking tower blocks and cladding, that that is why local authorities kept their massive reserves for. So, the chances of help there look remote. Perhaps the chancellor does not understand that not every authority has the level of reserves that have been reported for Kensington and Chelsea.
I think it is time I re-read the positive thinking book. I clearly didn’t quite grasp it all the first time.
