Pixel Funding Advisory Service

Service Plan for 2022-23

After years of waiting, the local government funding reforms will be implemented in 2023-24. These reforms were originally promised for 2019-20 but a combination of Brexit and then COVID forced Whitehall to delay their implementation.

Reforms could be far-reaching – and will affect the financial position of every council in England. We are expecting a redistribution of funding (Fair Funding Review), a baseline reset, a replacement for New Homes Bonus (NHB), and changes to other grants, including social care grants. There will be winners and losers from these changes.

Our service is designed to help you to prepare for these challenges by understanding how they might affect your authority’s finances. We provide regular analysis and briefings (in plain English) to help explain the proposals. And our forecasting models help you see how changes will impact on your authority in practice. In particular, our Fair Funding model will track (and forecast) all the proposals as they are published.

Highlights for 2022-23

Webinars. We started our regular online webinars during the pandemic, and they have now become a core feature of the service. They are now held at least every month, and often more frequently if there are important announcements.

Website. Our website provides you with all our news, updates and some new interactive tools.

Updated MTFP model and Fair Funding model. As new proposals are made, it will become increasingly important to keep these models updated so that you can see the latest impact on your authority’s funding.

In-depth and accessible briefings. We provide rapid briefings on the key announcements (spending review, Budget, settlement), with more detailed follow-on briefings. Our briefings are written in plain English to explain announcements, and to analyse the impact on local government.

Email updates. Rapid emails to tell you about announcements, with a short explanation of their content.

Pixel’s forecasting models

A key part of the service we provide are our two forecasting models: the Medium-Term Financial Planning (MTFP) model and the Fair Funding model. These models will help you to make robust estimates of the potential financial impact of the Government’s proposals on your own authority.

Medium Term Financial Planning (MTFP) model

This model allows authorities to see the potential effect of all funding changes at authority level and to make funding forecasts to 2030-31. The MTFP model includes our forecasts for:

  • Fair Funding Review. Latest outputs from the Fair Funding model and our latest intelligence on the “damping” options on overall resources (starting in 2023-24).
  • Business Rate Retention Scheme (BRRS). Key decisions about reforming the current system, including the baseline reset, cap compensation and s31 grants for reliefs.
  • Changes in other grant funding streams, including New Homes Bonus and social care grants.
  • Longer-term funding assumptions. Projections for funding over the medium term, from 2025-26 onwards.

Fair Funding model

The Fair Funding Review will be implemented in some form in 2023-24. We do not know whether a full or cut-down version will be implemented. The last consultation paper was released as far back as December 2018, so changes are very likely. Ministers will want to modify proposals so that they can show progress on “levelling up”.

If plans remain on-track, there will be a consultation paper before the Summer 2022 covering issues such as council tax equalisation, deprivation and social care formulae. As announcements are made, we will provide analysis and update our model.

Our Fair Funding model is still based on the proposals that DLUHC made before COVID, and it provides subscribers with a unique insight into what all the latest proposals mean for your authority and across the country. Our model includes the latest data, formula proposals and our judgement on how the whole funding package might come together.

Our model is also helping to inform the debate nationally about the potential impact of the Fair Funding Review.

If you would like to see the Fair Funding model and its impact on your authority, please contact me. We can also arrange workshops for individual authorities on request.

Other services for 2022-23

We will continue to provide our usual in-depth and responsive service:

  • Briefing notes on all the key announcements including the provisional and final settlements, Autumn Budget/ Spring Statement, further social care reforms, and any other relevant announcements.
  • Rapid briefings on the key working groups, if and when they are reconvened, including: Systems Design, Needs and Redistribution, Implementation Working group.
  • Full analysis of any consultation papers, including advice on how to respond.
  • Strategic papers on wider economic and fiscal changes, and the impact on local government funding.
  • Updates on reports from think-tanks, such as the Institute of Fiscal Studies, where they have local government funding implications.
  • Regular updates on the parliamentary debates, select committees and ministerial statements.
  • Tactical advice on preparing for 2023-24, including budget-setting strategy and NNDR3 2021-22.

We provide unlimited email and telephone support to subscribers. There is a subscriber page on our website containing all our briefing notes and latest models.

Every authority – or group of authorities – can arrange an online meeting. The topics for discussion at these meetings can be agreed on a case-by-case basis.

Events for 2022-23

Our events programme for 2022-23 will now take place online (Teams), with unlimited places free to subscribers.

We hold webinars every month with our partners at LG Improve (Dan Bates).

You can see all our previous online webinars (with slides) on our website: https://pixelfinancial.co.uk/events

Prices

We are applying inflation (5%) to our prices for the first time since we launched our service in 2010.

An annual subscription is £2,625 (plus VAT) for upper tier authorities and £2,100 (plus VAT) for district councils and fire authorities.

We offer significant discounts for authorities joining in a county group.