Council cuts hurt the most vulnerable: Rachel Reeves must use budget to stabilise local government

22 October 2024, 07:48

As more than 1,500 councillors, council leaders, senior officers, politicians and organisations gather for the start of the Local Government Association’s Annual Conference in Harrogate today (Tuesday), we have launched a new survey highlighting the urgent need for the Chancellor to act to stabilise local services in next week's Autumn Budget.

Our survey has found that one in four councils expect to apply for emergency government bailout agreements to avoid bankruptcy in the next two financial years. The situation is becoming increasingly precarious, with councils warning of cutbacks to essential services unless immediate financial support is secured.

Local councils are responsible for protecting vulnerable children, supporting older and disabled adults, and maintaining essential services like waste collection and social care. We are warning that without government action in the Budget, these services that form the backbone of our communities are at risk.

This is not just about numbers on a spreadsheet. Budget cuts needed to plug growing funding gaps will affect the most vulnerable members of society and the services our communities rely on every day.

An unprecedented 18 councils were given Exceptional Financial Support from the Government in February to help meet their legal duty to balance their books this year (2024/25). Yet, with councils already facing a funding gap of £2 billion next year, our survey reveals a worsening crisis with a growing number of councils being pushed further to the financial brink and likely to need EFS.

It shows that around one in 10 councils this year say they have discussed the possibility of requesting EFS from the Ministry of Housing, Communities and Local Government, while 25 per cent are likely to apply for EFS in 2025/26 and/or 2026/27 without additional government funding.

It also found 44 per cent of councils with social care responsibilities said that they are likely to apply for EFS in 2025/26 and/or 2026/27 without additional government funding.

The Chancellor must use the Autumn Budget to stabilise local government finances. This includes providing adequate funding for vital services, multi-year financial settlements, and initiating a cross-party review of the funding system.

Providing stability to the local government sector financially will not only protect key services but also provide a return on investment for the taxpayers while improving local services and communities.

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Cllr Louise Gittins is Chair of the Local Government Association, which represents 350 councils across England and Wales.

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