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"However, I am determined that the people of Birmingham should not be penalised for slow action by their local authority, and should still receive the allocation on the same basis as all the targeted authorities."
I understand the concern of my right hon. Friend the Secretary of State. I recently visited Birmingham and saw in action one of the projects that the money is funding. It is called Enta, which has worked in the city for many years to help get people back into employment and enjoying working life, particularly those who have been unemployed for many years.
Thanks to section 6 of the Sustainable Communities Act 2007, which requires the Secretary of State for Communities and Local Government to make arrangements for the production of local spending reports, local spending reports provide information on expenditure by bodies exercising public functions in a particular area over a specific period. The first local spending report was published this April and covered a substantial proportion of local public expenditure. It represented an important but, I stress, initial step.
The Government are continuing to strengthen the information provided and to ensure that it is accessible and easy to use. However, as I said, given such a mass of information, it is important to produce not only volume, but quality, and that the reports are practical, useful and cost effective.
Future local spending reports will be published online in a clear and user-friendly format that will enable easy interrogation of the data. They will include a wide range of public data on local spending by public bodies, including local authorities, and information will be made available on the local data exchange. An analytical capability will be available on the places databases. Greater transparency will make it easier to look across all local services in a specific area and to spot evidence of duplication or waste. It will help authorities and citizens to do a health check on the public spending in their areas.
It is of course already a legal requirement that local authorities produce a statement of accounts for each financial year which sets out their income and expenditure and gives a year-end balance sheet. The timely publication of high-quality year-end accounts is fundamentally important to sound financial management in every walk of life, not just local authorities. However, in local authorities, the statements must be presented fairly and give a true view, from 2009-10, of the authority's financial position. That means that the accounts must comply with the highest standards of accounting practice applicable to company accounts in the private sector.
Local authority accounts achieve that, but they also incorporate some modifications that are required by statute, largely to recognise the distinct nature of public sector bodies that are financed by taxation. The need to meet private sector standards and the statutory requirements makes local authority accounts rather complicated to say the least, but some authorities provide very useful summary accounts that give a clear presentation of their finances.
Birmingham city council failed to meet the timetable set down for the publication of those accounts this year. Accounts must be approved by council members by 30 June and published by 30 September. As I said, Birmingham city council failed to meet the timetable last year, and its audited accounts for 2008-09 had still not been published by 30 November 2009. We understand that the Audit Commission is to report on its concerns about the late publication of audited accounts very shortly.
Finally, I should like to touch briefly on the local government finance settlement, which of course makes the delivery of local authority services possible. The year 2010-11 will be the final year of the first ever three-year settlement for local government in England. Allocations of formula grant and area-based grant have been published for all authorities for all of those three years. We have also published allocations for all authorities of 100 per cent. by value of all specific grants that can be announced in advance. In other words, we have been as transparent as we can about the supply side, and we have given local authorities more certainty about available resources than has previously been available.
Over the current three-year settlement, we have also provided an additional £8.6 billion to local government-an average 4 per cent. increase per year in funding. However, we do expect local authorities such as Birmingham to ensure that the citizens to whom they are accountable know exactly, and in a timely fashion, how that money has been spent. That is their responsibility, and it is our responsibility to ensure that they fulfil it well and properly.
I thank my hon. Friend for this timely reminder of the work that we still have to do to ensure that we are as transparent and accountable as we can be. I also thank him for giving me the opportunity on the occasion of my final Christmas in this House to wish all the hon. Members a happy Christmas and a peaceful new year. I also wish to add my thanks to the those of the Deputy
Leader of the House to all the people who work in this House to make things easier for the rest of us. Happy Christmas!
7.36 pm
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