Investing in better local services

Funding to modernise local government services to deliver improved schools, better care for the elderly and to help the fight against crime received a boost today with an average annual real terms increase of 3.1 per cent, the Chancellor Gordon Brown announced.

"This settlement is good news for local government," the Deputy Prime Minister, John Prescott said when he welcomed today's announcement. "But it is money for reform.
"We have worked closely with local government to put together a six part package that will get extra money to where it is most needed, reward improved performance, provide more certainty over the next three years and give a huge boost to investment. It is a golden opportunity to make a real difference in the lives of our local communities."

The six part package includes:

a very good across the board increase in revenue grant for local authorities;
piloting of new local Public Service Agreements (PSAs) between local authorities and central government which will help to improve performance and reward success;
a new Neighbourhood Renewal Fund to channel £100 million in 2001-02, £300 million in 2002-03 and £400 million in 2003-04 to where it is most needed to tackle deprivation more effectively;
a huge boost to local authority investment in schools, transport and other key services;
extra resources for a new local government on-line initiative to deliver a step change in the electronic delivery of local services;
greater certainty over future funding levels for local authorities.

Notes for editors

1. Standard Spending Assessments - which increase on average by 3.1% per year in real terms over the three years (allowing for changes in responsibility) - are the amount of spending by local government as a whole which the Government is prepared to support through Revenue Support Grant. The plans for 2001-02 to 2003-04 are:

Standard spending assessments

£ million	2000-01	2001-02	2002-03	2003-04
Education	21,332	22,513	23,863	25,261
Personal Social Services	8,462	8,869	9,344	9,962
Police	3,350	3,650	3,839	3,995
Fire	1,393	1,463	1,521	1,583
Highway Maintenance	1,859	1,905	1,955	2,005
Environmental, Protective and Cultural Services	8,175	8,533	8,905	9,302
Capital Financing	1,735	1,948	2,223	2,623
Total Standard Spending Assessments	46,305	48,881	51,650	54,731
Note 1: All Standard Spending Assessments are for local authorities' revenue spending. Note 2: Figures for 2000-01 have been placed on a comparable basis to 2001-02 by adjusting for transfers made during the 2000 Spending Review reflecting changes of responsibility in 2001-02. Total transfers out of SSAs sum to £473 million. Note 3: Capital Financing figures for 2000-01 include the PFI Special Grant.

2. Grant support for spending is provided within the Department of the Environment, Transport and the Regions' local government programme (as Net Aggregate External Finance (AEF)). This programme also covers other activities including the new Neighbourhood Renewal Fund, resources for a new local government on-line initiative to pump-prime electronic delivery of services, and funds to reward authorities who achieve targets within local PSAs. The capital budget figures here are to fund these initiatives - the vast majority of capital investment is provided to local government through other departmental programmes.

DETR - Local Government

£ million	2000-01	2001-02	2002-03	2003-04
DETR-LG
Total*	35,353	36,801	39,241	41,855
of which: Resource Budget	35,306	36,745	38,965	41,529
Capital Budget	47	57	277	327
including:
Net AEF	34,928	36,358	38,378	40,718
Neighbourhood Renewal Fund		100	300	400
Local Government On-Line		25	135	190
Other Spending	424	318	428	548
*Departmental Expenditure Limit Note 1: Total DEL, Resource Budget and Net AEF for 2000-01 contain £473 million which has been transferred out for 2001-02 reflecting changes of responsibility in 2001-02.

3. Further details of local PSAs and pilot authorities will be announced shortly.

4. For more information, please call the DETR press office on: 020 7944 3042; out of hours: 020 7944 5925/5945 or e-mail: press@detr.gov.uk. Or call Public Enquiries: 020 7944 3000; e-mail contacts:

External links

Department for Communities and Local Government (formerly Department of Environment, Transport and the Regions)