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Local government finance settlement

The relevant section from the consultation which confirms the government intends to defer the setting of referendum principles for town and parish councils for three years:-

3.4 Town and parish councils

3.4.1 Since the introduction of council tax referendums in 2012-13, no referendum principles have been set for local precepting authorities such as town and parish councils ("parishes"), although the Government has made it clear that it would keep this under review and take action if necessary.

3.4.2 Ahead of the 2017-18 round of council tax setting, the Government issued a challenge to parishes to demonstrate restraint when setting precept increases that were not a direct result of taking on additional responsibilities, and to make precept decisions more transparent to local tax-payers. The average increase set by the sector in 2017-18 was 6.3% and the Government indicated that continued deferral of referendum principles would be dependent upon it receiving clear evidence of how the sector is responding to the challenge.

3.4.3 In response, the sector provided details of a range of activities around fiscal responsibility, transparency and engagement, the promotion of good practice and use of other sources of income, county-level engagement regarding significant precept increases' and publishing the Good Councillors' Guide to Finance and Transparency.

3.4.4 Having noted this work and the sector's request for longer-term certainty to aid financial planning, the Government intends to defer the setting of referendum principles for town and parish councils for three years. However, this is conditional upon:

- the sector taking all available steps to mitigate the need for council tax increases, including the use of reserves where they are not already earmarked for other uses or for "invest to save" projects which will lower on-going costs, and;

- the Government seeing clear evidence of restraint in the increases set by the sector as a whole.

·In NALC's response to the local government finance technical consultation we said if the sector is to respond effectively and efficiently to the range of fiscal challenges and onward devolution that the same confidence and certainty afforded to principal councils should be extended to local councils, calling for a multi-year initiative within which timeframe council tax referendum principles would not be extended to the sector, this would provide not only much needed financial certainty but also sufficient breathing space needed by the sector to re-dress the imbalance caused by changes to the tax base and loss/reduction of local council tax support grant.

• Provisional settlement 2018-19 Consultation (PDF, 447 Kb)