Responding to COVID-19: insight, support and guidance

Frequently asked questions

The Index

What are the aims of the Resilience Index?

The Financial Resilience Index is an analytical tool to support a high-level understanding of a local authority's financial resilience. It aims to help councils recognise potential signs of risk to their financial stability.

How does this support councils to improve their resilience?

The index provides a platform to facilitate constructive dialogue between those charged with decision-making and governance. The Resilience Index uses past data to support medium term financial planning.

Why is there no single overall indicator?

This data is not a predicator of failure. It does not produce a league table based on a single risk measure, as CIPFA does not believe that such a measure exists.

Why are only statistics for England available?

The current version of the index is focusing on England only. We are looking into supporting other areas where appropriate in the future.

Can we use it to tell which authority will be next to issue a S.114 notice?

No. There are a multitude of factors that can impact the decision to issues a S.114 notice. It is important to understand the local narrative that will accompany this data.

This model offers a transparent source of data to support Section 151 officers in their duty to employ good financial management.

Will this be updated next year?

We intend this data to be developed and updated on an annual basis.

The indicators

Who decided my nearest neighbours?

CIPFA maintains a model that generates sets of statistical nearest neighbours. The default model uses 20 factors including demographic variables, deprivation, employment and population density.

Why does my district not have a social care ratio?

District councils do not have responsibility for social care. CIPFA is still working with the Society of District Council Treasurers to identify a similar measure for districts.

Why is there no children's social care judgement for my authority?

District councils do not have responsibility for social care, which is why this has not been included in the index.

Why does the index use a number of different denominators?

The use of the different denominators reflects the discussions of the working group to provide greater accuracy. The denominators are total service expenditure, net expenditure and net revenue expenditure.

My reserves sustainability measure is the same as another authority, but the graph makes me appear higher risk?

In instances where authorities perform identically against both this indicator and the change in reserves indicator, they are presented on the graph in alphabetical order.

The data

Where is the data from and is the raw data available?

The underpinning data is publicly available - CIPFA has not used any data provided specifically by councils. The primary data source is the Revenue Outturn data set compiled by MHCLG. Because these data sets are readily available, CIPFA will not supply the raw data.

I think my data is wrong.

The financial data used in this index is all publicly available and should therefore be correct. However, any queries can be sent to analytics@cipfa.org.

COVID-19

Why does this data not account for the impact of COVID?

This data is based on 2019-2020 that is centrally collected. This was one of the founding principles of the Resilience Index.

2019-2020 was not materially affected by the pandemic as the data cut off was 31 March 2020. Therefore, it provides a useful pre-COVID baseline showing the resilience of councils as they entered the pandemic. We will reflect on 2020-2021 data indicators later in the year.

Why did you not net off the additional COVID payments?

There were two payments very late in March. One was the first tranche of COVID Funding. the second was business rates relief. This was treated differently within the RO data for different local authorities. Local narrative will cover variations, for example if reserves increased.

Could reserves show as having increased as a result of the treatment of these grants?

It is possible that reserves may be distorted as a result of these grants. This should be included in any local narrative.

Treatment of Direct Schools Grant deficits

From our discussions with the Resilience Index working group, we are aware that the RO form does not provide a clear picture on Direct School Grant deficits where a reserve is required. We aim to discuss with MHCLG how this could be improved for future years.