Council spending 2015/16
Where does council money come from and where is it spent?
Council will spend around £845m. This is bigger than lots of corporate
businesses and we provide hundreds of important services. One of our key duties
is to ensure that we are giving value for money.
The majority of council funding (70%) comes from central government. In recent years there has been significant change to the services councils provide and consequently to the way we get our funding. For example, the transfer of Public Health from the NHS in 2013/14 and the change in the provision of care and support resulting from the Care Act.
The Council has limited or in some cases practically no control over a lot of the money it spends. Of the £845m total spend, £194m is spent on Housing Benefit payments according to government eligibility criteria, and £189m is ring-fenced for Schools spend.
Council tax makes up a small but important portion (11%) of the overall money we receive to provide services.
have been able to retain a proportion of the business rates collected locally,
and to retain a portion of any growth. Previously all business rates were
handed over to government and redistributed nationally according to need.
However, the Government still sets the rules for the level of business rates
and takes most of the money. Retained business rates makes up 8% of council
Camden is able to retain 17p in the pound of business rate growth above the level of inflation. However if business rates fall the Council will suffer declining income. In that scenario we would bear the first £6.2 million in any fall in local business rates. This means that, more than ever before, it is important to work together to harness the benefits of economic growth.
Capital and revenue finance and funding
Local government finance is a complicated mix of law and accounting rules. There are key differences to how we can spend money and how finance works in the business world. One of the differences is the money and rules surrounding capital and revenue finance and funding.
- Revenue expenditure is essentially the running costs. This is the money we spend to run the services we provide. It includes the costs of employees, supplies and services, premises and utility costs.
- Capital expenditure is money spent on improving and investing in Camden's infrastructure, for example our roads, schools and buildings. The main point is that we, unlike private businesses, get separate funding for revenue or capital expenditure.
The overall rule is that we can spend revenue money on capital items, if there is any left over after paying the revenue bills, but we cannot spend the capital money on revenue expenditure.
More information on the breakdown of the income the Council receives and how it is spent is available here.
For further information on the Council’s finances, including our medium-term projections and financial strategy, please visit our financial strategy updates page.