The Financial Health of Local Authorities in England and Wales: Role of the Rate Support Grant, 1974/1975-1980/1981

The financial health of local authorities in England and Wales is examined over the period 1974/1975-1980/1981 to determine the manner in which financial positions have been affected by central government transfers under the rate support grant. The results of the analysis are preliminary pending fuller analysis of needs positions, but they do demonstrate that local party control has very little relation to grant allocations. This is mostly because of the interrelation with levels of urban stress, which is found to be a very significant correlate with levels of grant received. It is concluded, therefore, that in contrast to the USA, local authorities in England and Wales have received progressively larger grants in relation to higher levels of urban stress.