British Academy: We must debate how England is funded

The British Academy has today launched a new publication examining the distribution of public funding across England and calls for a debate on the funding of English local government.

The amount of government money that councils receive is being reduced and the demands on them are increasing. With Brexit looming, and public finances in the news again, this work explores and explains how public spending is distributed in England and why.

While the Government has recently committed to major public funding decisions including the NHS ‘birthday bonanza’ and the ‘Brexit dividend’, there has been little discussion of how England is currently funded.

Governing England: Devolution and funding is a collection of five papers by academics and policymakers on funding government and public services in England.

The publication examines the funding of government and public services from a range of perspectives:

• The historical context of current debates on public service spending, and why reform to local government funding arrangements has proved so contentious, by Professor Iain McLean FBA FRSE, Professor of Politics, University of Oxford


• An overview of how England is funded, by Alun Evans CBE, Chief Executive, the British Academy, and Martin Rogers, Policy Adviser, the British Academy


• An evaluation of the role of redistribution, financial incentives, local discretion and national standards in the funding of local public services in England, by David Phillips, Associate Director at the Institute for Fiscal Studies


• An exploration of the issues raised by the move towards to 100% Business Rate Retention, by Aileen Murphie, Director, MHCLG & local government value for money at UK National Audit Office


• The history of local government up to the present day, by Professor Tony Travers, Interim Dean of the School of Public Policy at the London School of Economics and Political Science.

With the Government focused on Brexit, the publication warns that there is a risk that the financial position of England is not fully recognised or analysed.

Alun Evans, Chief Executive of the British Academy and a co-author of the report said:

“As the UK prepares to leave the EU, financial and political uncertainty abounds. Local government is under severe financial pressure. With central government focusing more on incentivising growth than financial equalisation, things are likely to get harder in the short term – particularly in some regions. We must debate how England is funded and today’s publication aims to open that debate. Devolution must go hand in hand with a considered approach as to how local authorities can fund themselves.”

The publication is part of the British Academy’s Governing England project, a multidisciplinary project drawing on expertise from the humanities and social sciences to address issues around the government and governance of England.