"Without further funding, some councils will find themselves struggling to set balanced budgets in 2024/25 and potentially unable to do so as they look forward to 2025/26."
Responding to the report by the Levelling Up, Housing and Communities Committee on ‘Financial distress in Local Authorities’, Cllr Pete Marland, Chair of the Local Government Association’s Resources Board, said:
“The extra government funding recently announced is positive will help councils meet some of the pressures they face this year, particularly in adult and children’s social care. However, as this report sets out, significant challenges remain going into 2024/25 and beyond.
“Councils have led the way at finding ways to save money and reduce costs and this work will continue, but they will still need to raise council tax this year and many will need to make further savings to local services in order to plug remaining funding gaps. As the Committee rightly highlights, cost and demand pressures will continue to stretch council budgets to the limit. Without further funding, some councils will find themselves struggling to set balanced budgets in 2024/25 and potentially unable to do so as they look forward to 2025/26.
“The amount of funding available to councils is out of line with the requirements placed upon them. As well as needing to address this, any incoming Government needs to give urgent attention to the entire system of funding local government to deliver vital local services, including reform and legislative change. With fair, sustainable funding and multi-year settlements councils can plan ahead and help to deliver against national priorities such as economic growth, housing, net zero support for families and children and improved health.”
Ends