b'Preface The original version of this Guide (called simply A Guide to Local Authority Charging Powers) was published in February 1995 as an FT Law and Tax Special Report, towards the tail end of the then Conservative Government administration. Over the intervening period there have been many developments and changes of law impacting on local authorities ability to impose discretionary charges for services supplied or performed and with regard to local authority trading initiatives of various kinds. Local authorities remain under significant pressure to find new and innovative ways to address the unprecedented cuts in grants and other funding from central government, set to continue throughout 201920.More and more local authorities are seeking ways to supplement income by increasing revenue. Simultaneously, rising demand for some services are presenting Councils with difficult choices about which services they can afford to provide and at what cost to the user.By 2020, local authorities will have faced a reduction to core funding from the government of an estimated 16bn over the preceding decade. The funding cuts in local government are so great that efficiencies alone will not be enough. Pressures on budgets are increasing due to an ageing population pushing up demand for adult social care services such as home care for the elderly and infirm, the number of children in care doubling and waste management costs rising. LGA analysis indicates that these three areas of spending will soak up an ever-larger share of council budgets. Other servicestransport, leisure, culture, planning and economic developmentwill need to accommodate the further cuts meaning that spending in these areas will fall by 201920. Recently, it has been suggested that local authorities will be able to increase council tax in order to pay for social care. Spending in this area has fallen by 9% over the past five years, and local authorities may be given powers to increase council tax beyond the 2% they are currently able to. It is to help mitigate the effects of these unprecedented budgetary pressures that the use of charging to support service expenditure or to influence demand for services at the local level, merits close examination. However, councils need to ensure that their approaches to charging deliver the benefits expected and remain on the right side of the law. Charging for the provision of local authority discretionary services is not a new phenomenon but whenever local authorities impose new charges or increase existing charges, controversy is never far behind. There has been a significant rise in local authority commercialisation. A 2017 report by Localis, Commercial Councilsthe rise of entrepreneurialism by local authorities, states that:the sectors combined profits of externally traded services of 1.5bn between 2008 and 2013 exceeded that of companies like JD Wetherspoons (353m), John Lewis (885m) and Waitrose (1.25bn) over the same period. As part of our research into this phenomenon Localis has conducted a survey of 150 key local government figuresincluding chief executives, leaders, cabinet members and chief finance officers, and the results show that councils are behaving innovatively in a number of ways:8'