Newsletter September 2025

This February 2025 report  highlights the need for predictability in local authority capital finance. It explains what is needed for sufficient certainty to unlock billions of pounds of investment. This includes:

• a new round of Tax Increment Financing, with full retention of business rates and/or council tax, and no national cap;
• structural reforms to Business Rate Retention and New Homes Bonus;

• recommendations for grants for development;

• broadening the local tax base.

I wrote this article following reports that the Treasury was intending to change the primary measure of public sector debt. Much of it was based on TRL Insight’s 2018 report Building Freedom. It argued that:

• the Government should avoid making a simple technocratic change;
• Instead it should look at fiscal reporting in the round and implement more comprehensive reforms, facilitating:
•  investment in early intervention and preventing future costs;

• local authority-led growth.

Before Autumn 2024 Budget, TRL Insight wrote to Rachel Reeves and Darren Jones.

This letter summarised points in the article described immediately above:

• Fiscal reporting should be considered in the round
• More comprehensive reforms should be made based on the Government’s vision for the future of the UK, reflecting:
• the need for greater investment in early intervention and preventing future costs;

• the growing financial autonomy of local government.

This June 2024 report examines how the Government achieved a strong growth spending on services and goods in the early 2000s. The key to this was increasing tax bases and shrinking bills for other expenditure. Increasing tax rates contributed little and there wasn’t any net borrowing in real terms over the period 1997-98 to 2005-06.

During the 2024 election campaign and since, there has been a narrative that tax rate rises are necessary to fund improvements in public services. By contrast, this study highlights the importance of putting in place conditions conducive to growing tax bases. This, it argues, is the key to implementing spending pledges.

This LinkedIn article accompanies the report described immediately above, Tax Receipts and Government Spending.

This short read challenges the dominant media narrative that the only way to pay for increased public spending is through increasing tax rates.

It points out that the Government can take many actions which will stimulate the growth in tax bases. In the absence of external shocks to the economy, these could provide far higher increases in tax receipts than tinkering with rates. On the other hand, should such shocks occur, the public services will be in a far better shape to weather them.

This LinkedIn article points out that the biggest problems facing the NHS cannot be fixed by putting money into it.

Rather, they can only be solved by investing further upstream: in public health and in social care – crucially, including respite care.

This short read was in response to an item on the Sky News Daily podcast which contained an interview with a carer.

This LinkedIn article was published to coincide with the Get Britain Working white paper. It discusses how councils have been bringing together services to support people with health issues into work – a policy which was expected to be covered in the white paper.

It also argues that benefit sanctions and Government negativity towards claimants are counter-productive, increasing stress levels and thereby exacerbating health problems.

This evidence covers issues such as:

• The restricted tax base of local government;
• Problems with grant funding and plans for it;
• Problems with Business Rate Retention;
• Lack of financial autonomy for councils;
• Directions for expanding devolution and the Prudential System;
• Replacing the use of capital receipts for revenue purposes with a flexible capitalisation regime;

• MHCLG involvement in policies led by other departments affecting councils.

This response covers issues such as:

• Equalising for local taxes;
• Tax Increment Financing;
• Problems with using taxbase projections;
• Lack of financial autonomy for councils;
• Using retention of council tax to refocus NHB;
• Modelling partial and rolling resets;
• Broadening the local government tax base;
• Being pragmatic regarding simplification;
• Improved assessment of unit cost differences;
• Improving the Community Infrastructure Levy;

• Increasing financial autonomy and ditching the language of “rewards”.

This representation covers issues such as:

• Systematically analysing return on investment;
• Investment in social care and public health;
• Policies to reduce offending and reoffending;
• A toolkit for carbon reduction;
• Putting people in charge – and how planning reforms and enforced unitarization are at odds with this;
• Local authority finances and property taxes;

• Public finance reforms and metrics for higher living standards.

TRL Insight’s Tax Receipts and Government Spending shows how the Government achieved an increase in spending on services & goods from 2000 to 2005 that has not been seen since (see above). This was due largely to growth in the tax bases for the three or four taxes with highest yields and a reduction in other spend.

This analysis could be extended to:

• seek to identify what factors lay behind these increases in tax bases;
• identify which categories of other spend fell significantly and the reasons for this;
• examine the evidence base for rising prosperity in 2000-2005 being exceptional;

• examine high spending growth in 1988-1993.

Statistical models designed to explain variations in waste collection costs have often resulted in a poor match to recorded spend.

I could review existing models then carry out analysis to find a model which fits spend data better. This would explore the impacts of variables such as volumes of waste collected, number of households and household size, property types, settlement types (urban, towns, villages, hamlets), and staff wage differentials.

An improved model could help explain your costs to external audiences and predict future costs. For higher cost areas, it could provide evidence for lobbying for improved funding.

I can analyse your authority’s income and spending over an extended period and compare with key drivers of income and costs.

This can help you explain policy decisions to external audiences. By also considering forecasts for demographics and similar data, it can help to provide a sense of the possible future trajectories for these figures.

​I have previously carried out similar analysis for collections of local authorities as an associate of LG Futures and LGiU and as an employee of London Councils. More recently (2023-24) I have performed this analysis for a single local authority as part of an APSE Solutions team.

In my February 2025 report Unlocking capital investment in local economic development, on pages 59-63 I provide a case study of Newcastle’s Accelerated Development Zone.

I could extend this to provide case studies of other New Development Deals, Enterprise Zones and similar innovations in local economic development.

Further examples of case studies I have written can be found in Inclusive economies and healthy futures: Supporting place-based action to reduce health inequalities, published by the Local Government Association in December 2021.

If you are arranging a conference, seminar, webinar, workshop or training session and you’d like me to give a talk or presentation or facilitate a discussion, please get in touch.

My website and the past work described in my last newsletter will give you a sense of the subjects I can speak on. These include:

• local taxation and fiscal devolution;
• local authority income and expenditure;
• local infrastructure and economic growth;
• community empowerment;
• policies to achieve social & financial returns;

• local impacts of national policy.

TRL Insight could play a role in putting together an event which brings together the practitioners of such analysis with representatives of the public sector and bodies that advise and scrutinise it. This could examine the practicalities of a more systematic assessment of such opportunities when budgeting for multi-year periods.

This October 2024 report by New Local argues that the way the planning system is currently set up encourages confrontation and controversy. The main way for residents to engage with a planning application is to object.

If, instead, communities are given access to play a more constructive and engaged role, it is possible to build widespread consensus. This can lead to faster and better quality development.

I’d particularly recommend the podcast – and you can listen to it while eating your lunch or doing the washing up! Both the podcast and the report contain inspirational case studies.

This podcast on Local Economic Development is presented by David Marlowe, CEO of Third Life Economics and Mike Spicer, Managing Director of PolicyDepartment. Mike, when working at British Chambers of Commerce, set up the LEP Network, while David spent eight years as CEO of large complex public bodies.

They chat with expert guests on major themes and provide updates on hot topics in local economic development.

I’ve listened to a few episodes and always want to make copious notes on each one!

The podcast is available on Spotify, Amazon Music, Apple Podcasts and Google Podcasts.