|Client:||Welsh Government and Minister for Public Services|
|Project:||Systems of Local Government Finance, Local Taxation and Resource Allocation|
|Year:||2015 – 2016|
|Team:||Clive Grace, Mike Bennett and Tim Allen|
The purpose of this work was to examine the existing base of knowledge and research to establish how far it might inform potential options for the future funding and finance of Welsh local government.
As well as examining specific issues of policy we proposed three key principles of change:
- There is no ideal approach to systems of local finance and funding, rather there is a need for trade-offs between different possibilities. However the available choices need to be guided by a principled theory of change.
- Culture and tradition, political expectations, and approaches to public services are among the factors that influence how far experience is potentially transferable between countries and explains the diversity of international local government finance. For example, some states regard more services as appropriately local and needing local delivery and responsibility, while others see a greater proportion of services as national, and see national consistency and therefore control as a greater priority.
- Effective local government finance reform needs to be approached holistically to reflect and respond to a system characterised by interdependence and pluralism. Reform also needs to be suited to the adjustive capacity in the political and administrative context for which it is designed. This requires clarity of roles, responsibilities and functions for local government. It also requires a view about what level of government should deliver which services. Local finance and funding reform is a means to achieve more effective delivery of public policy and services but cannot be seen in isolation. The benefits will be limited in the absence of clear objectives, effective policy, strong service delivery and robust and regular evaluation.