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United Kingdom : Final Local Government Income and Expenditure Figures for 2016-17.

A National/Official Statistics Publication for Scotland.

Scotlands Chief Statistician today published Scottish Local Government Financial Statistics: 2016-17. This is an annual compendium publication that provides a comprehensive overview of financial activity of Scottish local authorities based on their final, audited accounts. The publication covers: local authority revenue expenditure and income, capital expenditure and income; reserves; debt; local taxation; and local authority pensions. The figures released today were produced by independent statistical staff free from any political interference, in accordance with professional standards set out in the Code of Practice for Official Statistics.

Revenue Expenditure and Funding

All Services

In 2016-17 gross revenue expenditure on services was 15.590 billion and income was 5.578 billion, resulting in a net cost of services of 10.012 billion. 4.830 billion of the net costs of services was on Education and 3.136 billion was on Social Work. These two services accounted for around three-quarters of the net cost of services. In addition, expenditure on the repayment of debt and the financing of capital investment was 1.686 billion, which results in a funding requirement of 11.699 billion.

Where a local authority provides housing, a separate account, (the Housing Revenue Account (HRA)) is kept to record the costs of housing. This is a self-financing stand alone account mainly funded from rental income. The statistics therefore report the General Fund and the HRA separately.

General Fund Revenue Expenditure and Funding

In 2016-17 gross expenditure on revenue services was 14.913 billion and income was 4.401 billion, a net cost of services of 10.511 billion. Further costs for the repayment of debt and the financing of capital expenditure amounted to 1.207 billion. This left a funding requirement of 11.718 billion.

This funding requirement is met from grant from the Scottish Government, Non Domestic Rate income, Council Tax and Reserves.

Total Funding in 2016-17 was 11.708 billion. This is made up of Scottish Government General Revenue Grant with 6.839 billion (58%), Non Domestic Rates with 2.769 billion (24%), Council tax with 2.091 billion (18%), and other funding of 0.009 billion (rounds to 0%).

This left a deficit of 9.914 million to be funded from reserves

The value of General Fund reserves at 1 April 2016 was 1.495 billion. After taking into account the deficit for the year plus a transfer from other reserves of 5.315 million the value of General Fund reserves at 31 March 2017 was 1.490 billion, a decrease of 4.599 million.

Housing Revenue Account Revenue Expenditure and Funding

In 2016-17 gross expenditure for the HRA was 0.677 billion and income was 1.176 billion, a suplus of 0.499 billion. Expenditure on the repayment of debt and the financing of capital investment was 0.479 billion. This left a surplus of 19.429 million to be added to HRA reserves.

The value of HRA reserves at 1 April 2016 was 154.909 million. After taking into account the surplus for the year, plus a transfer to other reserves of 4.899 million the closing HRA reserves was 169.439 million, an increase of 14.530 million.

Council Tax

The average Band D Council Tax in Scotland was 1,149 in 2016-17.

Council Tax income was 2.091 billion in 2016-17 (after Council Tax Reduction).

The total number of chargeable dwellings (i.e. the tax base) has increased slightly each year, rising from 2.40 million in September 2012 to 2.47 million in September 2017.

Non-domestic Rates

Non-domestic rates bills are calculated using the rateable value (RV) of a non-domestic property, multiplied by the poundage rate (48.4p in 2016-17) plus any relevant supplements (such as Large Business Supplement), less any rates reliefs.

Non-domestic rates income collected increased from 2.579 billion in 2015-16 to 2.731 billion in 2016-17. This is due to the net effect of several factors such as the inflationary increase in the poundage rate, the increase to the large business supplement, the curtailment of empty property relief and other changes to the tax base (e.g. new or demolished properties).

Non-domestic rates reliefs provided relief of 0.59 billion in 2016-17, down from 0.63 billion in 2015-16. A curtailment in empty property relief was the main factor which contributed to the reduced total.

As at 1st April 2017, the non-domestic rates tax base comprised of 233,386 non-domestic properties on the Valuation Roll with a total rateable value of 7.358 billion.

The non-domestic rates Distributable Amount was 2.77 billion in 2016-17.

Capital Investment

To be able to deliver services a local authority has to invest in its assets, such as roads, schools and flood defences. In 2016-17 local authorities spent 2.962 billion on capital expenditure.

General Fund Capital Investment

In 2016-17 capital expenditure by the General Fund totalled 2.285 billion, an increase of 21% or 0.393 billion.

This capital expenditure was funded from Scottish Government grants (33%), other grants and contributions (7%), borrowing money (42%), credit arrangements (finance leases / private finance initiatives) (9%) capital reserves (5%), and revenue reserves (4%).

Total General Fund borrowing at 1 April 2016 was 10.068 billion which equates to borrowing per head of population of 1,874. New borrowing for capital expenditure increased this by 954 million, with repayments of borrowing reducing the borrowing by 438 million. The value of borrowing at 31 March 2017 was 10.580 billion, an increase of 513 million. This equates to a borrowing per head of 1,958, an increase of 84 (4.5%) per head over the financial year.

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Publication:Mena Report
Date:Feb 28, 2018
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