The PAC report, Local government funding: assurance to Parliament, was published on 12 September and complained that there is a “gap in assurance” for £2.8 billion of ‘target’ grants. Though grants are given to local authorities for specific tasks such as welfare provision and transport improvement, departments are not monitoring whether the money is being used as agreed and thus has achieved intended goals.
Commenting on the report, Graeme McDonald, Director of the Society of Local Authority Chief Executives and Senior Managers (Solace), argued that the assurance issue would be solved if local authorities formed a “fiscally autonomous layer of government” with its own mechanisms for assurance, asserting: “Local government should raise and spend money locally.”
“Expecting Whitehall to have a handle on how each public pound is spent is both unrealistic and undemocratic,” he said. “Only with devolved powers will local people be able to make the decisions that ensure their money is spent wisely.”