Councils 'face £5.8bn funding black hole'

Councils 'face a £5.8bn funding gap'

Councils 'face a £5.8bn funding gap'

First published in News

COUNCILS need to make huge savings before next April, equivalent to an eighth of their total budgets, a new report warns.

Analysis from the Local Government Association, which represents almost all English councils, says local authorities face a £5.8bn funding ‘black hole’ between March and 2016, caused by government cutbacks and rising demand for services such as adult social care.

The funding gap in adult social care alone amounts to £1.9bn in 2015-16, the LGA said.

April marks a critical point for the under-pressure service, with the pooling of £5.4bn from councils and the health service, and is already being described as a “make or break” moment.

But despite the cuts, the LGA said, councils will try to protect spending on social care next year as much as possible, potentially meaning cuts will have to go further and deeper in other areas such as bus services, libraries or leisure centres.

The North-East and Yorkshire and Humberside are among the regions with the most severe long-term problems. North-East councils’ forecast funding for 2019-20 is, on average, just 74 per cent of expected demand; while Yorkshire and Humberside is the lowest in England, at 73 per cent. The South East stands at 83 per cent.

Conservative LGA chairman Sir Merrick Cockell said: “In recent years, local government has worked tirelessly to save billions while protecting services for those who need them most.

“But the scale of the challenge facing local authorities next year is stark. Council finances are on a knife-edge and the old way of doing things – including the way we care for our elderly population – just won’t work any more.

“Next year will be a make or break moment for adult social care.”

A major report into the future of adult social care funding to be released later this week is expected to warn the service could become unsustainable if current cuts continue.

However, local government minister Brandon Lewis said the LGA’s “doom-laden and alarmist claims lack credibility”.

Councils account for a quarter of all public spending and must play their part in reducing the deficit, he said, adding that councils were balancing their books and the public thinks they are delivering services better than before.

“There is significant scope for councils to make sensible savings and cut waste by tackling the £2bn of council tax left uncollected, the £2bn ignored or lost from fraud, the £2.4bn of surplus properties left dormant and the £19bn piled up in reserves,” Mr Lewis said.

Comments (5)

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7:04am Tue 1 Jul 14

bambara says...

Even the Tory local government representatives are now saying these cuts are unacheivable, and the Tory councils are subject to much lower cuts than the Labour ones.
Even the Tory local government representatives are now saying these cuts are unacheivable, and the Tory councils are subject to much lower cuts than the Labour ones. bambara
  • Score: 0

11:48am Tue 1 Jul 14

John Durham says...

The vast majority of services provided by councils are determined by central government. Its something like 1,500 pieces of legislation and set standards. Yet the government requires these councils to try to maintain these services and set standards of care whilst cutting back the funding for them.
Of course, the public are being fed the spin that its all the councils' fault when services are cut or council tax is increased.
A win, win for the government but a lose, lose for anyone who depends on those services like the elderly, disabled etc.
The vast majority of services provided by councils are determined by central government. Its something like 1,500 pieces of legislation and set standards. Yet the government requires these councils to try to maintain these services and set standards of care whilst cutting back the funding for them. Of course, the public are being fed the spin that its all the councils' fault when services are cut or council tax is increased. A win, win for the government but a lose, lose for anyone who depends on those services like the elderly, disabled etc. John Durham
  • Score: 2

12:32pm Tue 1 Jul 14

loan_star says...

Maybe now they will start cutting back on councillors expenses and the pay of the top brass instead of always picking the lower paid easy targets!
Maybe now they will start cutting back on councillors expenses and the pay of the top brass instead of always picking the lower paid easy targets! loan_star
  • Score: 0

1:31pm Tue 1 Jul 14

BMD says...

C,Mon Ada, lead from the front, I am sure you could manage a £130,000 cut.
C,Mon Ada, lead from the front, I am sure you could manage a £130,000 cut. BMD
  • Score: 1

1:34pm Tue 1 Jul 14

stevegg says...

I think you will find the police and fire service are in a far worse position as they have no slack anymore and further cuts in 2015/2016 to come are going to be extremely painful for them and more so the public who will likely see a reduced service due to ever dwindling resources/staff. By 2016 Durham police will have lost circa 700 police officers since 2006 leaving only 1000 to do the same job. Councils still have a long way to go to match their level of efficiency savings but bleat on like they have nothing else to cut. Its far to easy for council officials to write off unpaid council tax than it is to collect it, they make only token efforts at recovering this unpaid money and as a result taxpayers like us foot the bill. The time has come to be ruthless in this area and chase all unpaid arrears relentlessly. There is no doubt, even with efficiency gains in the council there are going to be some tough and unpallitable decisions with the withdrawal of many services we have taken for granted by 2016 with the entire focus placed on the mandatory provision of services alone and those dicetionary ones consigned to history. Despite all the spin to the contrary you cant do more with less, you only get less back!
I think you will find the police and fire service are in a far worse position as they have no slack anymore and further cuts in 2015/2016 to come are going to be extremely painful for them and more so the public who will likely see a reduced service due to ever dwindling resources/staff. By 2016 Durham police will have lost circa 700 police officers since 2006 leaving only 1000 to do the same job. Councils still have a long way to go to match their level of efficiency savings but bleat on like they have nothing else to cut. Its far to easy for council officials to write off unpaid council tax than it is to collect it, they make only token efforts at recovering this unpaid money and as a result taxpayers like us foot the bill. The time has come to be ruthless in this area and chase all unpaid arrears relentlessly. There is no doubt, even with efficiency gains in the council there are going to be some tough and unpallitable decisions with the withdrawal of many services we have taken for granted by 2016 with the entire focus placed on the mandatory provision of services alone and those dicetionary ones consigned to history. Despite all the spin to the contrary you cant do more with less, you only get less back! stevegg
  • Score: 2

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