Funding black hole will swallow popular council services

The Local Government Association has launched its campaign to influence the forthcoming Spending Review by warning about the growing risk to vital local services if the Government does not take action to secure the financial sustainability of councils.

However, the LGA said that, with the right funding and powers, councils can continue to lead their local areas, improve residents’ lives, reduce demand for public services and save money for the taxpayer.

Between 2010 and 2020, councils will have lost almost 60p out of every £1 the Government had provided for services.

Some councils are being pushed to the brink by this unprecedented loss of funding and an ongoing surge in demand for children’s services, adult social care services and homelessness support. This is on top of having to absorb other cost pressures, such as higher national insurance contributions, the apprenticeship levy and the National Living Wage.

More and more councils are struggling to balance their books, facing overspends and having to make in-year budget cuts.

Councils provide more than 800 services to residents in their local area – some of these are legal duties they have to provide whilst others are optional powers they can use depending on local priorities.

Money is increasingly having to be diverted from these optional services, which help build communities people want to live in, to plug growing funding gaps, while some councils have already been forced to cut their services back to the legal minimum “core offer”.

With councils in England facing an overall funding gap of £8 billion by 2025, local government leaders fear many more will have to take similar action.

That could mean many cherished local – but discretionary – services such as the maintenance of park face being drastically cut back by councils across the country.

An investigation recently found that one in three parks no longer has any staff on site, park funding has been reduced by at least £15 million in the past two years, with 95 per cent of councils expecting to make further cuts to parks in the next five years.

Cutting these discretionary – often preventative - services is also a false economy as they can help alleviate pressure on statutory services. Other parts of the public sector, such as the NHS, are also then forced to pick up the pieces. For example, parks and leisure facilities can help improve the health and wellbeing of residents.

LGA Chairman Lord Porter said:“The money local government has to provide vital services is running out fast and huge uncertainty remains about how councils will pay for services into the next decade and beyond.

“If the Government fails to adequately fund local government then it will be our local communities and economies who will suffer the consequences. It will be those who rely on vital adult social care to live independent lives, rural bus routes to get out and about, council tax support to ease financial burdens and those who value clean streets, green spaces and roads fit for the purpose.

“The Spending Review will be make or break for vital local services and securing the financial sustainability of councils must be the top priority.

“This is the only way to ensure councils can meet their legal duties to provide dignified care for our elderly and disabled, protect children, and prevent and reduce homelessness and protect the wide-range of other valued local services which also make such a positive difference to communities and people’s lives.”

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