Debate on MHCLG spending estimates, House of Commons, 2 July 2019

Councils will face an overall funding gap of £3.1 billion in 2019/20, which we estimate will rise to £8 billion by 2024/25. The pressures are particularly acute in adult social care, children’s services, public health and homelessness support. Overspends in these services have forced councils to make in-year budget cuts to balance their books.


Key messages

  • Between 2010 and 2020, councils will have lost almost 60p in every £1 of central government funding. This has created an unsustainable gap in council funding that is having a significant impact on the services which local authorities deliver in their communities.
  • Councils will face an overall funding gap of £3.1 billion in 2019/20, which we estimate will rise to £8 billion by 2024/25. The pressures are particularly acute in adult social care, children’s services, public health and homelessness support. Overspends in these services have forced councils to make in-year budget cuts to balance their books.
  • Residents’ satisfaction with local services has remained relatively high in recent years, despite the funding reductions councils have dealt with. However, there are signs of this satisfaction decreasing.
  • Councils have responded to the financial challenge by streamlining services and innovating. There are 550 shared services arrangements among councils, which have achieved £805 million of cumulative efficiency savings.1 Local government has all but exhausted the potential for substantial savings, and new investment is now urgently needed.
  • National political uncertainty and an unresolved Brexit means the chances of the Government carrying out a three-year Spending Review in 2019 look increasingly unlikely. Councils urgently need some certainty about how local services will be funded next year.
  • It is vital that the Government uses the Spending Review to deliver truly sustainable funding for local government. Investing in local services is good for the nation’s prosperity, economic growth and overall health and wellbeing.

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Debate on MHCLG spending estimates, House of Commons, 2 July 2019


#CouncilsCan

#CouncilsCan: Spending Review 2019
 

With the right funding and powers, councils can continue to lead local areas, improve residents’ lives, reduce demand for public services and save money for the taxpayer. Securing the financial sustainability of local services must be the top priority for the Spending Review.

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