As it happened: Budget 2015 and how it affects local government



6.15pm: Here is the LGA's Budget 2015 on-the-day briefing - and with that, we will end today's live blog. Thank you for reading. 


5.03pm: Some more Budget reaction:

  • Terry Scuoler, chief executive of the EEF manufacturers' organisation, said: "The Chancellor gets three cheers from manufacturers for the measures he's included to boost exporters. His decision to bring forward compensation for industries facing vast and uncompetitive energy costs, such as steelmakers, is a huge vote of confidence for them and for manufacturing more widely. In addition, he has committed to a stable and competitive tax regime, which we wholeheartedly support."
  • GMB general secretary Paul Kenny said: "Osborne has claimed more recoveries in the past five years than the RAC. Even a blind person would see the short-term bribes Osborne is offering. What he is planning, however, is the most draconian cuts in services that we rely on for a civilised way of life."
  • Public and Commercial Services union general secretary Mark Serwotka described the Budget as "another brutal assault on unemployed, sick and disabled people".
  • John Longworth, director general of the British Chambers of Commerce, said: "The Chancellor's focus on business growth and prosperity will receive a warm welcome from businesses of all sizes. The Chancellor avoided the temptation to use newfound windfalls for gimmicks. His focus on fiscal responsibility will play well with business audiences."
  • The Institute of Directors said: "This was a solid and responsible budget. Few chancellors would be able to resist the temptation to binge on a £22 billion windfall from the sale of bank shares this close to an election. By using it to pay down our national debt, George Osborne has shown commendable discipline."
  • Unite general secretary Len McCluskey said: "George Osborne's smugness today is utterly out of place for someone who missed every target he set himself. He cannot hide the long-term economic pain he caused to the decent people of this country with his senseless austerity, run away from the living standards that he levelled back to 2007, or hide from the record levels of personal debt swamping the people of this country."
  • Barnado's chief executive Javed Khan said: "We're disappointed that the Chancellor has chosen to combat in-work poverty with tax changes that benefit higher earners three times more than the poor. Struggling working families will see precious little from the tax change."

4.32pm: Councillor Peter Fleming, chairman of the LGA's Improvement and Innovation Board, has responded to the announcement in today's Budget that HM Treasury, the Department for Communities and Local Government and the Government Digital Service will collaborate with partners in local government

"Councils are on the frontline of public services and help residents navigate and access a range of vital public services. Any commitment to greater digital collaboration to enable the public sector to join up more effectively around residents will help our communities.

"Councils are best placed to work with residents in shaping and designing digital solutions appropriate to local circumstances, so it is absolutely vital that we all work together and share our expertise and understanding of our customers.

"The LGA has long been supporting local government to deliver digital services and, with a wealth of knowledge and experience, central government needs to work with us on this project."



4.09pm: The LGA is calling on residents, councillors, councils and anyone else who values public services to sign up to our Future Funding thunderclap, which is campaigning for fairer funding for local government:

Local councils have shouldered the biggest cuts of any part of the public sector - in total more than 40% while continuing to deliver the local services you and your family need. They've kept parks open for your children to play in, cared for your elderly relatives, cleaned your streets, collected your rubbish on time and provided nearly 800 other services. If councils continue to get less money from the government, we will all have to make difficult decisions about which services continue. In the next five years we need fairer funding for local government so that services you value can continue to be delivered.


3.45pm: A reminder that our Budget 2015 on-the-day briefing will be published at later this afternoon. 


2.33pm: LGA Chair Cllr David Sparks has also looked ahead to the next parliament:

"Between the Chancellor's first Budget in 2010 and the end of the next financial year, the money government gives to councils to provide local services will have fallen by 40 per cent. Local authorities have played a huge role in balancing the country's books, but more of the same cannot be an option in the next five years.

"The next government must protect funding for local services, tackle the adult social care crisis and set out a new settlement for England which devolves decisions about infrastructure and skills as well as health and social care, down to local areas.

"Motorists who rely on good roads, young families who use local children's centres and older people who depend on care will all feel the repercussions of a failure to fundamentally reform how their services are provided and paid for."

The LGA's 100 Days campaign is calling on the next government to implement a number of measures aimed at boosting housing, improving school provision, halving the number of unemployed young people and supporting people to live independently at home. 


2.20pm: The Local Government Association has issued our response to today's Budget. LGA Chair Cllr David Sparks, said:

"This Budget has acknowledged the need for changes to the way public services are funded and delivered and for more of the important decisions to be made closer to the people who use them.

"But it has not protected funding or delivered the bold approach to English devolution which will be essential to the survival of our libraries, children's centres, parks and local buses in the next few years.

"The adult social care system is currently stretched to breaking point. If older people are to get the quality of care they deserve then funding for care must be protected. Investing money in the NHS while forcing councils to cut their social care budgets is simply a false economy. This hasn't been addressed by the Chancellor today, which makes it all the more vital that it becomes one of the biggest priorities for the next government."


2.11pm: George Osborne was on his feet for 59 minutes, making this the longest Budget speech of this parliament - and of his career as chancellor.

Here are the figures from previous Budgets:
  • 2010: 54 minutes
  • 2011: 56 minutes
  • 2012: 58 minutes
  • 2013: 54 minutes
  • 2014: 55 minutes
(source: Treasury/BBC)


2pm: On the subject of the Chancellor's announcement of a major review of the business rates system,Simon Pitkeathley, Chief Executive of Camden Town Unlimited Business Improvement District, says:

"A review of business rates is needed to level the playing field so that companies large and small can grow. This needs to be radical and should overhaul the current dysfunctional system."

"Business leaders, Local Enterprise Partnerships and Business Improvement Districts such as ourselves now need to take a leadership position and build a consensus around what any new rates system should look like."

"Any overhaul of business rates should recognise the financial contribution that many small companies already make to improving their local area."


1.54pm: As Ed Miliband concludes his response to the Budget, here is a word cloud of the Chancellor's speech. The size of each word indicates its frequency of use.


1.43pm: The Budget book is now available online

Meanwhile, you can read the Chancellor's speech in its entirety here.









1.37pm: The chancellor announced a major review of the business rates system and a reduction in the annual investment allowance to be set at a rate "much more generous" than £25,000.

Read LGA leader Councillor David Sparks's response to the Treasury's announcement of a business rates review here.


1.33pm: And the Chancellor sits down...


1.23pm: George Osborne announces support for the North of England, including a transport strategy for the North, funds for the Health North initiative and the agreement of a new city deal for West Yorkshire Combined Authority.

Greater Manchester to be allowed to keep 100% of growth in local business rates.

The Chancellor also gives the go-ahead for £60 million investment in energy research accelerator in the Midlands, with new national energy catapult to be in Birmingham.

The LGA's DevoNext campaign fully backs greater devolved powers. We believe de-centralising power can bring economic, political and social benefits to communities across the country. 

Our online resource gives detail about what powers councils have already been given and what they're doing with these powers, as well as tools to help councils negotiate further devolution.


1.13pm: The Chancellor pledges funding to tackle children's mental health. Read the local government response to the children and young people mental health taskforce report




12.56pm: This from @LGANews


12.48pm: The Chancellor highlights today's employment figures. The LGA warned in January that a million people were not getting help into work.


12.39pm: Mr Osborne said that "Britain is walking tall again" with faster growth than any major economy.

Latest projections show living standards "will be higher than when we came to office", said the Chancellor.

Mr Osborne said: "We set out a plan. That plan is working. Britain is walking tall again."

The "central judgement" of the Budget is "to use whatever additional resources we have to get the deficit and the debt falling".

The Government's goal is for the UK to be "the most prosperous major economy in the world, with that prosperity widely shared", said the Chancellor.


12.33pm: And we're off. Says George Osborne: "Britain is growing, creating jobs and paying its way."


12.30pm: Only minutes away from George Osborne's final Budget speech before the General Election. To follow our live tweets of his speech, follow @LGANews


12.22pm: Budget tipple

Tradition dictates that the Chancellor can drink whatever he or she wants while making the Budget speech – including alcohol, which is otherwise banned under parliamentary rules.

Previous Chancellors have opted for whisky (Kenneth Clarke), gin and tonic (Geoffrey Howe), brandy and water (Benjamin Disraeli), spritzer (Nigel Lawson) and sherry and beaten egg (William Gladstone). Today, however, George Osborne (like his two predecessors, Alistair Darling and Gordon Brown), will drink water.


11.54am: As PMQs fast approaches (followed hot on its heels by the Budget speech), some gentle encouragement to sign up to our Future Funding thunderclap, which is campaigning for fairer funding for local government in order to protect key public services. 


11.39am: Today's budget – with a General Election only weeks away – is likely to have an impact on local government and the services it provides. In May 2015 the country will have a new government which will be faced with a number of difficult issues. 

At the top of the in-tray will be the ‘must do' tasks it will have to tackle. Launched at the LGA's annual conference, 'Investing in our nation's future: the first 100 days of the next government' is the LGA's campaign which identifies the key priorities for this new government.

Our offer, to whoever forms that government, is to help them deal with the issues that matter most to the people of this country, changing lives for the better and investing in the future of our nation.

You can find out more about the campaign here


11.35am: Ever wondered why the Chancellor holds aloft the red box?


11.30am: Ahead of George Osborne's speech, which is due to begin at 12.30pm immediately after Prime Minister's Questions, we have taken a look back at the content of last year's Budget speech - represented in a word cloud (a visual representation of what he said, where the size of each word indicates its frequency of use, for those of you wondering). 


11.27am: The Chancellor has emerged from Number 11 and is on his way to Parliament. 

With him he has his red box, which is synonymous with the budget, in a tradition dating back to 1860 when William Gladstone had a wooden box hand-crafted and covered with scarlet leather. George Osborne used the Gladstone Box for his first Budget in 2010 but used a new box in 2011.

Made by industrial trainees at Babcock Rosyth Defence Ltd ship and submarine dockyard in Fife, the new box is made of yellow pine, with a brass handle and lock, covered in scarlet leather and embossed with the Royal initials and crest and the Chancellor's title. 


11.22am: The LGA is launching Local Government Finance Day on March 24 to highlight the work councils have undertaken in dealing with significant cuts in funding. The day is part of our Future Funding campaign, which has been backed with an Early Day Motion.


11.12: As expected, the Budget dominated this morning's headlines. 

According to our daily news headlines round-up:

George Osborne is to set out his tax and spending plans in the Budget later - his last before the election. Reports suggest the UK's finances may be boosted by a £10 billion windfall, as a result of low inflation and stronger economic forecasts, giving the Chancellor room to ease planned spending cuts and fund tax cuts for millions of workers. Labour said the Conservatives were planning "more extreme spending cuts" after the election. Further details on a devolution deal for West Yorkshire, a review of the business rates and plans to hand five million pensioners with annuities the right to cash them in from April next year, are also expected. 


10.52am: The Office for National Statistics says unemployment fell by 102,000 between November and January to 1.86 million.

The number of people claiming jobseeker's allowance last month fell by 31,000 to 791,200. Average earnings increased by 1.8% in the year to January, 0.3% down on the previous month, said the ONS.


10.42am: The LGA Budget Submission states:

"Local government will have dealt with a 40 per cent real terms reduction in core government grant funding by April 2016. Local government has received a greater reduction in funding than the rest of the public sector and therefore should not be subject to further cuts in this year's Budget. Any further reductions to public spending need to be driven by public service reform."


10.06am: Back to the LGA Budget Submission for a moment...

We also believe the government should take action in the following policy areas:

Education and children's social care

  • Reverse the 48 per cent cut in the Early Intervention Grant to councils recognising that this is a false economy that will increase costs elsewhere in the public sector.
  • End restrictions preventing schools and councils from pooling budgets to integrate child protection and narrow the attainment gap for deprived pupils.
  • Make five year allocations of schools capital to a single local capital pot in each area to free councils and schools to work together to make the most efficient use of scarce capital to provide new places and repair and rebuild crumbling schools.

Growth, skills and infrastructure

  • Implement funding and policy commitments in the Growth Deals swiftly without imposing bureaucratic hurdles.
  • Devolve all funding for local growth, regeneration, skills and employment support through councils to Local Enterprise Partnerships in a single investment fund.
  • Inject a further £1 billion a year into roads maintenance by investing the equivalent of just 2 pence per litre of existing fuel duty. 
  • Fully fund the cost of the concessionary fares scheme and allow councils to have greater control over all bus subsidies and local provision.
  • Guarantee the 39 LEP areas strategic decision making powers over how, when and on what their share of England's 2014-2020 £5.3 billion European Structural and Investment Funds (ESIF) is spent.

Local government finance

  • Introduce more local flexibility over who receives the single person discount to help ensure support goes to those who need it most.
  • Relax council tax referendum rules to allow local communities to decide on local policy priorities through the ballot box.
  • Introduce and fund a new council tax discount for volunteering to support voluntary work across the country.


9.59am: We will be tweeting all things Budget-related throughout the day - including live tweeting the Chancellor's speech - from our Twitter handles. Follow @LGAComms and @LGANews to stay up to date with developments.


9.40am: The LGA has also called on the Government to ensure this year's Budget takes into account issues in several key areas, including:

Adult social care

  • Protect funding for social care services in a similar way to how health spending is being protected.
  • Fully fund the cost implications of the Care Act and the Supreme Court judgement on Deprivation of Liberty Safeguards.
  • Fully integrate the funding for the commissioning of care and health as a step towards a single point of commissioning.

Welfare reform

  • Fully fund council tax support, acknowledging that the scheme to date has taken millions of pounds out of funding for council services, and has increased the cost of living for some of the poorest.
  • Provide longer term certainty for local welfare assistance funding at a level that is responsive to demand.
  • Maintain funding for Discretionary Housing Payments (DHP) at the 2014/15 rate in line with the ongoing demand that it is designed to mitigate.
  • Ensure that any new costs or administrative burdens from the welfare reforms that are passed from central to local government are matched by the appropriate funding in line with the ‘new burdens doctrine'.


9.26am: Our Budget Submission covers several key areas, which we have urged the chancellor to address.

We are calling on the Government to:

  • Protect public services in England and ensure adequate funding so that councils can provide these services locally.
  • Make place based finance, underpinned by multi-year settlements for all local public services, the default method of service funding and delivery, empowering local partners to work towards shared outcomes.
  • Engage in true, meaningful devolution of decision-making powers and funding to the local level. The devolution settlement across the UK has to be fair


9.05am: Before the Chancellor stands up, we'll be looking at how the Budget could affect local government and summarising theLGA's Budget Submission, published last month.

We'll also be looking at the LGA's campaigns and the potential impact on them of this year's Budget, including100 Days,Future Funding and DevoNext.

And we'll bring you infographics and unusual Budget facts as the day progresses.

Meanwhile, the@LGACommstwitter handle will live tweet the Chancellor's speech.


9am: Good morning and welcome to our live coverage of Budget 2015.

The chancellor George Osborne will, at around 12.30pm today, deliver his final Budget before the General Election on May 7.