Pixel Funding Advisory Service
Service Plan for 2024-25
Next year will be another year of enormous uncertainty for local government funding. A General Election (likely in the Autumn) will bring new ministers and new ideas about local government funding. There is also currently no spending review for 2025-26, and only the vaguest indications of future spending plans. And of course, we continue to wait for the major funding reforms that have been promised for nearly a decade.
A particular challenge for 2025-26 is that the provisional settlement is likely to be in the immediate aftermath of the Election. Agreeing the new settlement will be a priority for the incoming government. But there will be very little time between the Election and new numbers being announced, giving local authorities very little time to adjust. The only good news is that the scope for making any policy changes will be very limited, thus reducing the chances of the unexpected changes in funding immediately before budget setting.
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 MTFP model will help you to assess the assumptions for 2025-26 and over the next spending review period.
Highlights for 2024-25
Updated MTFP model and Fair Funding model. Updated MTFP model to reflect the expectations for 2025-26.
Webinars and annual conference. Our regular webinars have now become a core feature of the service. We will be holding a webinar on financial resilience in local government (April 2023) and an in-person conference (June 2024).
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.
Website. Our website provides you with all our news, updates and latest models.
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.
The Medium Term Financial Planning (MTFP) 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:
- Assumptions for Settlement Funding Assessment (SFA). We currently assume that SFA will be cash-flat in 2025-26 and beyond. Business rates baselines will be uplifted in line with Consumer Price Index (CPI).
- Business Rate Retention Scheme (BRRS). Key decisions about reforming the current system, including the baseline reset, cap compensation and s31 grants for reliefs.
- Damping and transitional support. Updated options for transitional support following any funding reforms.
- 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, to 2030-31.
We will be undertaking a full refresh of the MTFP model, with updates to reflect local authorities’ requirements. The model will be updated to show the all the specific fire grants, develop the council tax assumptions (including showing the valuation list and Council Tax Support separately), and we will streamline the model where possible.
With the introduction of the premium on second homes in 2025-26, we will also include an element estimating the additional revenue for every local authority, and allowing you to input your own assumptions.
Changes in the distribution of funding will be implemented in some form in the coming years (our model assumes 2026-27 but it could be later). Our Fair Funding model provides subscribers with a unique insight into what all the latest proposals mean for your authority and across the country. As proposals are put forward by ministers (or by a new government), we will update the model so that it shows the latest position.
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 2024-25
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,.
- 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 2025-26, including budget-setting strategy and NNDR3 2023-24.
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. Training session on MTFP model or business rates system.
As more fire and police authorities join our service, we will be extending the MTFP model so that it covers both types of authority more effectively. To start with, we will include all the fire grants within the MTFP model. This is useful both for fire authorities and for those county councils and unitary authorities with a fire function. The first iteration of this new model will be in April 2024.
Also, watch out for our new service, which will help authorities to develop a range of funding scenarios. We can develop a range of scenarios (up to 15) based on the variables within the MTFP model (25+ variables). These scenarios can be compared to your in-house forecasts, and to spending projections. The service will be additional to the subscription – but give you in-depth, tailored support. You can find out more about the service on our website: https://pixelfinancial.co.uk/news
Events for 2024-25
Our events programme for 2024-25 takes place online (Teams), with unlimited places free to subscribers. We hold monthly webinars with our partners at LG Improve (Dan Bates): https://pixelfinancial.co.uk/events
Details of our webinar on local government financial resilience in April 2024 will be released soon. We will have an external speaker at this event, as well as our usual updates and analysis.
We are going to hold an in-person conference in June 2024. We will have a range of speakers, as well as opportunities for networking. Arrangements will be released in the near future.
Prices
We are applying inflation (5%) to our prices in 2024-25. An annual subscription is £2,900 (plus VAT) for upper tier authorities and £2,320 (plus VAT) for district councils and fire authorities.
We offer significant discounts for authorities joining in a county or regional group.
Partnerships
We have been working in partnership with LG Improve and we would recommend their new service. The service itself provides analysis and benchmarking of local authority financial accounts and makes use of LG Improve’s unique database containing 8 years’ accounts data.
Contact:
Adrian Jenkins
0796 998 0016
Website: https://pixelfinancial.co.uk/
Subscriber page: https://pixelfinancial.co.uk/subscribers