Local authorities report facing a £54 billion shortfall and considering cuts to services
The County Councils Network has highlighted that the funding gap is mainly due to increasing costs in children’s services, adult social care, and school transport for SEND pupils.
According to the County Councils Network (CCN), local councils are at risk of becoming primarily care service providers, as they may need to prioritize these services over others. The CCN predicted that if current projections hold, local authorities in England could face a cumulative £54 billion shortfall over the course of this Parliament. Without additional funding or a reconsideration of councils’ statutory duties by the government, this shortfall is likely to persist.
Councils deliver a variety of services, some of which are legally required, such as children’s services and adult social care. Despite annual council tax increases, local authorities have had to allocate more funds to these essential services, resulting in reduced spending on other crucial services like buses, libraries, and road maintenance for residents.
The CCN emphasized that the projected £54 billion deficit is primarily driven by rising demand and costs in children’s services, adult social care, and home-to-school transport for SEND pupils. These three areas account for 83 percent of the total expected increase affecting councils by 2030.
Factors contributing to the increased cost of adult social care include a growing population of adults with disabilities requiring complex care and a significant number of individuals with mental health conditions in need of support.
The CCN’s warning, directed at 22 councils facing potential bankruptcy, comes as a result of a survey conducted among council executives, revealing that without changes in funding or responsibilities, several local authorities could be at risk of financial collapse in the coming years. This could impact services offered to over 16 million residents in England.
Councilor Barry Lewis, the finance spokesman and vice chairman of the CCN, highlighted the urgent need for additional resources to address these service pressures and proposed substantial reforms to manage rising costs effectively.
In response to the report, a government spokesperson acknowledged the challenges faced by local authorities and pledged to work with them to provide greater stability through multi-year funding settlements and other reforms. The government is set to provide more details in the upcoming spending review and local government finance settlement.
It is evident that local councils are grappling with significant financial strains that could jeopardize their ability to deliver essential services to residents.
PA Media contributed to this report.
