Autumn Budget and Spending Review Submission 2024

Challenge and opportunity

The 2024 Autumn Budget and the 2025 Spending Review are taking place in the context of challenging fiscal conditions. At the same time the new Government has set out an ambitious programme to reform and restore key elements of our public services. Our submission is aimed squarely not only at improving the lives of our councils’ residents but also at helping the Government deliver its missions in the context of these financial challenges. Councils will be a key partner for Government in delivering its objectives.

But we cannot shy away from the fact that councils are under severe financial strain. Inflation, wage pressures and growing demand and complexity of need mean that councils face a funding gap of £6.2 billion over the next two years. And this needs to be seen in the context of the estimated £24.5 billion in cuts and efficiencies in service spending that councils made between 2010/11 and 2022/23. If councils’ net service spend had grown in line with inflation, wage growth, demographics and demand drivers since 2010/11 it would have been a full 42 per cent higher in 2022/23 than actual service spend in 2022/23. Councils have had to absorb these huge pressures through service cuts or efficiencies.

Given the scale of the financial challenges councils have already overcome, and of those they face going forward, it is not surprising that the financial sustainability of some councils is being severely tested. This is clearly demonstrated by the fact that 18 councils, 16 of them with social care responsibilities, are reliant on Exceptional Financial Support from Government in order to secure their financial sustainability for 2024/25. This is unprecedented. While the underlying reasons for this support vary across these councils, the sheer scale of this intervention by the Government indicates the risk of financial failure is potentially becoming systemic. The sector needs immediate financial support to head this off.

Despite councils’ best efforts, financial pressures are affecting the scale, range and quality of council services provided to local residents. The clearest evidence of this is that councils’ service spending is increasingly focused on adult and children’s social care; on average social care councils allocated 65.6 per cent of their 2024/25 service budgets to social care. Ultimately spending is increasingly concentrated on fewer people, so councils are less able to support local and national agendas on key issues such as housing, economic growth, and climate change.

It is reassuring to hear that the Government recognises the financial challenges facing the sector. At an LGA event on 18 July, the Deputy Prime Minister acknowledged that, “the biggest crisis facing local government is financial”. She committed to provide financial stability and certainty through long-term integrated funding settlements, and to ending the “bidding wars” between councils for grant funding. The Deputy Prime Minister was also clear that local government funding was in need of reform.

Following through on these commitments, alongside providing sufficient funding for councils, will provide councils with the financial stability and certainty they need to make their full contribution to public service delivery and help the Government deliver its ambitions. The return to local communities and the Government on this investment will be substantial. This was recognised by the Deputy Prime Minister who was clear that councils sit at “the very heart” of the Government’s five missions. Councils are “key partners to deliver the 1.5 million homes, as well as the secure affordable council and social homes we will deliver, the key partners in delivering safer streets and bringing our high streets back into life. And of course, [councils] are key partners in delivering that critical frontline social care. These are the foundations of a good life”.

A key ask of our Local Government White Paper published in June 2024 was a fundamental reset of the relationship between local and national government. It is time for a new, equal and respectful partnership between local and national government, drawing on the best international practice. We are an outlier in the OECD, heavily reliant on national decisions for funding and powers. As a result, at a time when people are struggling to afford the basics, millions of pounds of taxpayers’ money is spent by local government to chase down new sources of investment from Whitehall. 

If we are to meet the challenges of the coming decade, we need a joined-up and strengthened system of governance that has a sharper focus on outcomes for the people we serve. We want to work with government to create a non-bureaucratic and agile forum for local and national government to discuss forthcoming legislation, aggregate expenditure levels and emerging areas of joint priority. This would ensure local government is able to bring its frontline expertise and experience to the heart of national policy development, drawing on the experience of systems which do this well. This would also provide an opportunity to build on and expand the highly successful programme of sector support that the LGA provides, and which is currently funded by government.

Our submission

Our submission builds on the same clear-eyed analysis presented by the Deputy Prime Minister; councils are the key to delivering communities’ key priorities and the Government’s missions, but significant steps need to be taken to provide councils with financial stability and certainty in order to unlock their full potential. We recognise that providing additional financial support to councils when public resources are tight is challenging, but as demonstrated throughout our submission the potential return on this investment is substantial. Councils do not spend money for its own sake, every penny goes on providing services that are at the heart of local communities’ priorities and the Government’s missions.

Our submission is built around a number of sector-wide priorities set out in our Local Government White Paper. This paper draws on evidence provided through substantial consultation with councils and stakeholders. The council-led nature of this exercise means that our priorities are not consciously designed to reflect the Government’s missions, but the read across between the two is clear and telling nonetheless. Breaking down barriers to opportunity by supporting children and young people, kick starting economic growth and housing supply, making Britain a clean energy superpower and delivering net zero, ensuring that adult social care is both effective and able to support the NHS to be fit for the future, and making safer streets for all are shared objectives for both councils and the Government. Councils’ priorities are also the priorities at the heart of the Government’s missions.

We identify eight priorities within our submission. Two of these are cross-cutting finance themes. The first relates to the need for sufficient and sustainable funding. The second highlights the benefits of investing in preventative services rather than a reactive, demand-led model to service spending. There is substantial evidence that preventative spending in areas such as adult social care, children’s social care and homelessness services improves people’s lives and reduces cost to the public sector over the long-term. Equally, investment in services such as culture and leisure, public health and community safety offers similar benefits in terms of outcomes and savings. We believe that a greater focus on preventative spend – providing appropriate services at the right time rather than waiting until an individual is in acute need – provides better value for money, improves people’s lives and should be at the heart of the Government’s approach to public services.

Our remaining six themes reflect key service priorities identified in the consultation to inform our White Paper. In each we clearly set out the benefits to communities and the Government of providing the resources and reforms councils need to deliver to their full potential. We urge Government to use the 2024 Autumn Budget and the 2025 Spending Review as an opportunity to capitalise on the substantial contribution councils can make to meeting communities’ priorities and delivering Government’s missions. A full list of the proposals in this submission can be found in Appendix A.

Priority 1: Sufficient and sustainable funding

Councils need a significant and sustained increase in overall funding that reflects current and future demands for services. In addition, the system for funding councils is out of date, opaque and urgently in need of reform. Councils need multi-year and timely finance settlements, and greater certainty over financial reforms, to enable them to plan ahead and make meaningful financial decisions. Financial certainty and stability will improve the value for money of local spending and enhance councils’ ability to drive public service reform and key government agendas and missions.

Key proposals include that Government should:

• Provide councils with a significant and sustained increase in overall funding that reflects current and future demands for services.
• Provide councils with multi-year and timely finance settlements.
• Lead a cross-party review of options to improve the local government funding system. This should include a fundamental review of council tax alongside other council funding sources. The review also has to include consideration of whether business rates retention represents a viable future funding model.

Priority 2: A new focus on prevention and services for the wider community

Preventative services – those that intervene earlier in people’s lives and reduce the need for later acute and reactive spend - are vital to people living fulfilled, happy and productive lives. They are also vital to addressing the drag on our economy from socioeconomic inequality and poor health. The LGA wants to work with the Government to improve outcomes and increase the efficiency of public spending by intervening at the earliest practical opportunity to minimise preventable disadvantage. We are asking the Government to enable greater local flexibility and to take a more long-term, broad-based approach to spending decisions to ensure that short-term savings do not impair more enduring social and economic outcomes.

Key proposals include that Government should:

• Ensure that the potential long-term benefit of spending on prevention is routinely considered in both Treasury and departmental spending decisions.
• Work with councils to strengthen cost-benefit analysis with an enhanced understanding of social return on investment and better tracking of long-term outcomes.
• Increase investment in the public health grant and in other vital areas of public health and prevention. At a minimum, funding should be restored to the public health grant, which has suffered a cut of 27 per cent in real terms since 2015/16.
• Implement the Hewitt report recommendation that the share of total NHS budgets at Integrated Care System level going towards prevention should increase annually by at least 1 per cent over the next five years. This should include commissioning strategies overseen by Integrated Care Partnerships.

Priority 3: Building the houses we need

Councils share the Government’s commitment to build more homes and are ready to play their part in addressing the national housing and homelessness crisis. By enabling councils to deliver more affordable, high-quality homes, the Government can alleviate homelessness and support our communities. This will ultimately improve public finances through reduced temporary accommodation costs and housing benefit expenditure, and support the Government's mission of kickstarting economic growth.

Key proposals include that Government should:

• Strengthen Housing Revenue Accounts via a long-term rent settlement of at least 10 years and restoration of lost revenue due to rent cap/cuts, to give councils certainty on rental income and support long-term business planning.
• Reform Right to Buy to support 1:1 replacement of existing social housing to avoid continued net loss of stock. This should include: allowing councils to retain 100 per cent of sales receipts; permanent flexibility to combine receipts with other government grants; and the ability to set the size of discounts locally; and exempting new build homes.
• Realigning temporary accommodation housing benefit subsidy rates to 90 per cent of 2024 Local Housing Allowance rates, so that councils have more resource to invest in homelessness prevention.

Priority 4: Supporting our children and young people

The Government has stated that “every child should believe that success belongs to them” – and we agree. Councils play a key role in building great places for children to grow up and in breaking down the barriers to opportunity. That includes through the delivery of children’s services and as co-leaders of local education systems, making sure that every resident, from babies through to adults and whatever their background and needs, has what they need to thrive.

Key proposals include that Government should:

• Introduce a cross-government strategy for children that clearly articulates the role that each department plays in delivering the best possible start for children.
• Provide sustainable funding to enable a move towards preventative and early help services across children’s services and special educational needs and disability (SEND) provision – making sure that children and families get the help they need, when they need it, and before situations deteriorate.
• Introduce a children’s workforce plan to make sure that babies, children and young people have the right professionals supporting them to achieve their potential.
• Introduce long-term reform to the SEND system, as set out in the LGA/CCN-commissioned research, which improves outcomes for all children with special needs and is also financially sustainable for councils.
• Write-off all Dedicated Schools Grant deficits to relieve the associated financial pressures that councils are currently facing. Ahead of this, Government should provide councils with certainty on the future of the statutory override for these deficits.
• Provide funding to address the substantial and growing cost pressures of home to school transport, particularly for children with SEND, or work with councils to identify ways to manage demand for, and access to, this service. These immediate measures should be accompanied by longer-term reform of home to school transport.

Priority 5: Reforming and sustainably funding adult social care

The Labour Manifesto rightly identified adult social care as being vital to ensuring that everyone can live an independent and prosperous life. Immediate investment to stabilise the here and now, and pave the way for longer-term reform, is needed. But investing in care and support must also be seen as a key enabler of delivering the Government’s mission to build an NHS that is fit for the future, particularly the move to a more preventative model of health and care. More broadly, given its scale and size, adult social care can play an important part in helping to the deliver the Government’s mission on economic growth.

Key proposals include that Government should:

• Provide immediate funding to alleviate the worst consequences of the current challenges, with the exact amount identified through a collaborative process across the care and support sector.
• End the reliance on council tax and the social care precept as a key means for funding adult social care.
• Commit to review NHS Continuing Healthcare.
• Provide new and dedicated funding to help kickstart a concerted effort to shift to a more preventative model of care and support.
• Take action on care worker pay.

Priority 6: Backing local climate action

Climate change is an urgent and mounting threat to human wellbeing and the health of the planet. Its impacts risk upending every ambition we hold for people, places and services. Its solutions demand action from everyone at every level and in every place. Only local government can lead, mobilise and connect action in places; councils demonstrate this every day. We hold influence to drive down a third of every place’s carbon emissions efficiently and effectively. In the context of wider funding pressures, a continuation of the status quo risks threatening the future of local climate action at a time that it is most needed.

Key proposals include that Government should:

• Revitalise partnership with local government through a Local Green Energy Mission Delivery Programme with responsibility to move forward local government’s contribution to accelerating action.
• Ensure that every area is covered by a Local Climate Action Plan agreed by central and local government, with long-term funding certainty to build scale and accelerate project delivery.
• Rapidly retrofit social and fuel poor homes. Bring forward and devolve all funding for retrofitting social and fuel poor homes to councils.
• Rewire current proposals to extend the Emissions Trading Scheme so that the cost are passed to manufacturers and retailers of fossil-based content rather than councils, with the aim of accelerating decarbonisation investment.

Priority 7: Delivering economic growth

We are pleased that the Government wants councils to be at the heart of its Kickstarting Growth mission and that devolution is to be deepened and widened across the whole country. For all councils to play a full and meaningful role, they need long-term certainty of funding and the flexibility to make investment decisions that reflect local economic priorities. This includes skills and employment, transport and digital connectivity.

Key proposals include that Government should:

• Work with LGA on the English Devolution Bill so that all councils, including in mayoral combined authorities, can play a full and meaningful role in delivering inclusive growth.
• Introduce a simplified, consolidated and long-term approach to growth and infrastructure funding, giving local leaders flexibility over where and how investment decisions are made locally.
• Take immediate action to stabilise the existing growth funding landscape by progressing current Levelling Up funded projects and providing an additional year of fully flexible UK Shared Prosperity Fund (UKSPF) revenue funding to remove the funding cliff edge for many projects and organisations delivering growth.
• Work towards a fully devolved and integrated employment and skills offer so business and public sector can respond faster, better and inclusively, to the needs of local people and employers.
• Introduce a reformed funding package for local bus services that removes bureaucracy and ensures that tax-payers money goes to supporting people and routes where it’s needed the most.

Priority 8: Safer streets

The Government has clear ambitions to “take back our streets”. Mission objectives include: cracking down on antisocial behaviour with more neighbourhood police; tough new penalties for offenders; a plan to get knives off our streets; a specialist rape unit in every police force; and a new network of Young Futures hubs. This area also has an added focus due to recent violent disorder. The Government recognises the mission and its stated aims cannot be achieved without local authorities acting as delivery partners. To do so, councils need resources and not just duties, as well as a radical reform of the partnership landscape.

Key proposals include that Government should:

• Invest in communities hardest hit by recent violence to ensure extremism does not thrive. This includes Youth Hubs and diversionary activities for young people.
• Reform the duty and partnership landscape to ensure Community Safety Partnerships are equipped with the powers and partners to deliver.
• Ensure Community Safety Partnerships are adequately resourced to deliver.
• Make sure Community Safety Partnerships have the intelligence and data sharing capabilities to prioritise local responses.

To unlock the full potential of councils the sector needs sufficient and sustainable funding, and increased freedoms and flexibilities. Over the long-term there needs to be a review of, and reform to, the overall revenue funding system for councils.

Cost pressures

Economy-wide pressures

A fundamental challenge facing the sector is that cost and demand pressures are rising faster than funding. While inflation has fallen since its peak in 2022/23, the sector is still grappling with the huge resulting uplift in its cost base. Councils also continue to face wage pressures driven by increases in the National Living Wage (NLW) alongside cost and demand pressures in specific service areas. Our analysis demonstrates that by 2026/27 cost and demand pressures will have added £8.9 billion to the cost of delivering council services since 2024/25. This is 12.5 per cent in additional service cost pressures in just two years.

The NLW has been a particularly significant driver of councils’ costs over recent years. The NLW rate increased by 9.7 per cent in 2023/24 and 9.8 per cent in 2024/25. Both of these increases were at the top end of the Low Pay Commission’s forecast. If this pattern continued into 2025/26 this would mean a 6.5 per cent increase in the NLW for 2025/26. (Based on the Low Pay Commission’s March 2024 forecast)

Our analysis indicates that these increases added £1.4 billion and £1.6 billion to the cost of commissioned adult social care services in 2023/24 and 2024/25 respectively. A 6.5 per cent increase in 2025/26 would add a further £1.2 billion. That is a potential £4.2 billion in additional costs for commissioned adult social care over three years due to unfunded NLW increases. Furthermore, although less exposed to the NLW than adult social care, other council service budgets have been affected by these unfunded NLW increases as pay awards have exceeded affordability for many councils.

Service specific pressures

In addition to the economy-wide inflationary and wage pressures there are individual service areas with cost and demand dynamics that are exerting higher cost pressures:

• Rising costs in children’s social care – councils face growing complexity of need and increases in placement costs.LGA research has shown that in 2022/23 councils paid for over 1,500 placements costing £10,000 or more per week – more than 10 times greater than the 120 placements purchased by councils at this price in 2018/19. This has created huge pressure on councils’ budgets with budgeted real terms spend on children’s social care increasing by £2.8 billion (25.7 per cent) from 2019/20 to 2024/25. There appears to be no real sign of this budget pressure reducing. Of the additional £2.8 billion in budgeted spend since 2019/20, £1.3 billion of this increase was from 2023/24 to 2024/25.
• Escalating costs of home to school transport for children with special educational needs and disabilities (SEND). The number of children and young people with an Education, Care and Health Plan increased by 62.7 per cent from 2018/19 to 2023/24. This in turn has driven a real-terms increase in budgeted spend by councils on home to school transport for children with SEND of £544 million (64.3 per cent). Overall, councils budgeted £1.4 billion in 2023/24 for SEND home to school transport.
• Increasing costs and demand in adult social care means budgeted net spend on adult social care increased by £3.7 billion (18.1 per cent) in real terms from 2019/20 to 2024/25. As with children’s social care, despite the rate of inflation falling from its recent peak there is little sign of these cost pressures tailing off. Of the additional £3.7 billion in budgeted spend since 2019/20, £1.9 billion of this increase was from 2023/24 to 2024/25. A Spring 2024 survey of Directors of Adult Social Services concluded that the financial situation facing the service “is as bad as it has been in recent history”. Budget overspends in 2023/24 were the highest for a decade, savings required in 2024/25 are at their highest for eight years and there is an “increasing reliance on one-off reserves to prop up budgets”.
• Increasing costs of homelessness services with multiple contributory cost and demand drivers, including asylum and resettlement issues and an insufficient supply of affordable housing. Government data shows that more than 117,000 households, including 151,630 children, were in temporary accommodation at the end of March 2024 – the highest figures since records began in 1998. Councils’ budgeted net spend on homelessness services has increased by £604 million (77.4 per cent) in real terms from 2019/20 to 2024/25. Again, there is no sign of these cost pressures abating with £336 million of this increase taking place from 2023/24 to 2024/25.

There is no sign of pressures subsiding in these service areas. Based on a continuation in these pressures our modelling shows the significant cost pressures they will generate for the sector over 2025/26 and 2026/27 (Table 1).

(Source: LGA analysis of multiple public data sources).

Funding gaps

When overall cost pressures are compared with modelled change in core revenue funding for councils we estimate that councils face a £2.3 billion funding gap in 2025/26 rising to £3.9 billion in 2026/27. This is a £6.2 billion shortfall across the two years. These funding gaps relate solely to the funding needed to maintain services at their current levels. The implication here is that councils do not have enough funding simply to stand still.

Our funding gap analysis assumes that council tax referendum thresholds remain at their 2024/25 level going forward and that councils raise their rate to the maximum. This would mean a 5 per cent increase in the rate for social care councils – 3 per cent on council tax plus 2 per cent via the adult social care precept. This implies an above inflation rate increase in council tax for local residents in the middle of a cost of living crisis. Councils will be hugely reluctant to pass these costs on to their residents, but they have very little option as not doing so will widen their funding gap and place more services at risk. Leaving councils with no option other than to raise council tax is not the answer to the sector’s current financial challenges.

Long-term pressures

Councils’ ability to cope with current cost and demand pressures is hampered by the years of funding reductions in the 2010s. Councils’ core revenue funding has begun to rise in recent years, but we estimate that Core Spending Power is still 22 per cent lower in real terms in 2024/25 compared to 2010/11. Councils are tackling their current cost and demand pressures having already removed roughly one fifth from their budget baselines over the previous years.

But the savings councils have had to make since 2010/11 are not solely due to funding reductions. Councils have also had to deal with growing demand and more complex patterns of need. Taking all of these funding, cost and demand pressures into account it is clear that councils have made huge savings in their service spending since 2010/11.

For instance, our analysis shows that in 2010/11 councils had a cash terms net revenue spend of £45.3 billion on services. This fell in the first half of the 2010s but then grew, partly due to the addition of public health responsibilities, to £58.3 billion by 2022/23. However, we estimate that if council net service spending in 2010/11 had grown in line with inflation, wage growth and demographic and demand drivers it would have been £82.8 billion by 2022/23 – 42 per cent higher than actual service spend in that year. This means that councils have made £24.5 billion worth of cuts or efficiencies to their net service spending from 2010/11 to 2022/23.

Table 2 shows the scale of these cuts and savings by service area. In some service areas such as culture and leisure, and highways and transport net spend in 2022/23 was effectively half of what it would have been had it kept pace with inflation, wage growth and demographic and demand pressure since 2010/11.

Even in service areas with significant statutory responsibilities and demand pressure, service spend is still significantly lower than it would have been had it moved in line with cost and demand pressures. For instance, we estimate that councils have made £6.6 billion in cuts and efficiencies in adult social care net spending from 2010/11 to 2022/23. (This is a conservative estimate. We include modelled demographic pressure but we do not factor in growing complexity of need over this period and any resulting impact on unit costs). Spend on this service area was effectively a third smaller in 2022/23 than if it had moved in line with cost and demand pressures since 2010/11.

(Source: LGA analysis of multiple public data sets. Methodology available on request)

(Notes. 1. Totals may not sum due to rounding. 2. Data shown is for London Borough Councils, Metropolitan Borough councils, Shire Counties, Shire Districts and Shire Unitaries. The Greater London Authority, standalone fire authorities, Combined Authorities, National Park Authorities and Waste Authorities are excluded. 3. Children’s social care is adjusted to include on Sure Start and services for young people from 2010/11 and throughout the time series).

Financial sustainability and resilience

Budget setting

Councils find themselves in 2024/25 in an incredibly challenging financial position. They face significant funding gaps going forward yet have already made huge cuts and efficiencies in their service budgets since 2010/11. They have to continue to find savings in order to meet demand for statutory services, yet opportunities for savings in discretionary services have largely been exhausted and many of these services have effectively been halved in size. This combination of past and ongoing pressures means that financial resilience in the sector is at an all-time low. An LGA survey following the 2023 Autumn Statement showed that one in five leaders and chief executives felt they are at risk of receiving a Section 114 report by the end of 2024/25.

Exceptional Financial Support

The scale of the pressures facing the sector was demonstrated in February 2024 when the then Department for Levelling Up, Housing and Communities (DLUHC) took the unprecedented step of announcing that 18 councils would receive Exceptional Financial Support in 2024/25 to address financial pressures that the councils considered unmanageable. Almost all these councils (16) had social care responsibilities. This meant that the sector entered 2024/25 with more than 1 in 10 social care councils dependent on a significant one-off relaxation of the financial framework – an agreement that revenue spend could be capitalised - to secure their financial sustainability. While the underlying reasons for this support vary across these councils, the sheer scale of this intervention by the Government indicates the risk of financial failure is potentially becoming systemic.

The sheer number of councils that have been allowed to capitalise revenue spending under the Exceptional Financial Support scheme demonstrates that there is clearly an ongoing need for additional financial support for some councils. However, it is worth considering whether the current scheme is effective. The Institute for Government, for instance, recently described the system in which councils are temporarily allows to borrow or use capital receipts to finance revenue spending as "completely unsustainable".

In our view there is a risk that the system as currently designed could potentially load struggling councils with further debt and/or undermine future capital programmes by burning through councils’ capital receipts. In this context the Government should assure itself that the current Exceptional Financial Support is achieving its objective of supporting councils in returning to financial sustainability in an efficient and effective manner.

Use of reserves

Evidence of this pressure is clear in councils’ recent use of their financial reserves. In 2022/23 there was a net reduction in councils’ total usable reserves (unringfenced earmarked and unallocated reserves) of £1.7 billion, with 59.4 per cent of councils reducing their reserves. Latest figures show that in 2023/24 there was a further reduction of £1.1 billion, with 53.9 per cent of councils reducing their reserves. Councils’ reliance on their reserves across these two years is unprecedented in recent years and is a clear warning signal that a large number of councils are struggling to balance their books. While use of reserves is high across the sector, they are highest amongst councils with social care responsibilities. Some 71.5 per cent of these councils drew on their reserves in 2022/23 and 71.1 per cent in 2023/24.

While some councils have been able to use reserves to temporarily offset budget pressures, drawing on reserves is not a sustainable solution to current budget pressures. While some councils’ reserves grew during the COVID-19 period others did not or did so from a very low base. Furthermore, use of reserves may provide a degree of resilience over the short-term, but this is only temporary as reserves can only be spent once. If councils use reserves repeatedly to offset recurrent pressures they will rapidly find themselves still having to address unfunded pressures but now also with depleted reserves. In this context it is concerning that 42.1 per cent of councils drew down on their reserves in both 2022/23 and 2023/24.

Risks to service sustainability

Service sustainability

Despite the financial pressures councils have faced since 2010/11 the vast majority have met their statutory responsibility to balance their books annually. But this does not mean that services remain unchanged and sustainable. As demonstrated above (Table 2) councils have made huge cuts and efficiencies in their services since 2010/11. Several service areas with fewer statutory responsibilities such as highways and transport are now roughly half the size they would have been had spending increased in line with inflation, wage costs and demographic drivers. But even services with a greater number of statutory responsibilities and regulatory oversight have seen cuts and efficiencies over this period. Lack of capacity will hamper councils’ efforts to support the Government’s missions and play a full part in initiatives such as further digitalisation of public services.

Despite the best efforts of councils to continue to provide the services needed by their residents it is inevitable that the sheer pressure of funding reductions and cost and demand pressures over a prolonged period is impacting on the scale, range and quality of local service provision. Key issues include:

• Council spend is increasingly concentrated in fewer services and on fewer people: As resources have diminished, councils have protected services such as social care (adult and children’s) where there are clearly defined statutory responsibilities and regulatory oversight. Ultimately spending is increasingly concentrated on fewer people, so councils are less able to support local and national agendas on key issues such as housing, economic growth, the cost-of-living crisis, and climate change. On average (at the median) social care accounts for roughly two thirds (65.6 per cent) of budgeted net service spend (excluding education, fire and police) in 2024/25 amongst councils with social care responsibilities, up from 55.8 per cent in 2015/16. In some councils the share of service spend on social care is even higher, with a quarter of social care councils budgeting for social care spending to account for over 70 per cent of their net revenue spend.
• There are growing concerns over the quality and scale of service provision: Due to financial pressures councils are struggling to provide the services their residents need:
  • The LGA Annual Resident Satisfaction Survey shows that the share of respondents that are satisfied with council service provision has fallen for every service area in the survey between 2016/17 and 2023/24. Satisfaction levels for each service have all fallen by between 3 and 16 percentage points since 2016/17.
  • In children’s social care, Local Child Safeguarding Practice Reviews (undertaken where a child dies or is seriously harmed, and where abuse or neglect was already known or suspected) indicate that many of the issues that undermine the effectiveness of safeguarding practice are to do with serious resource shortages. Separately there is evidence that due to market pressures some councils have no choice but to continue using unregulated placements for under 16-year-olds in care. Ofsted recently stated that, “the national shortage of placements for children with complex needs means some particularly vulnerable children live in these settings for long periods”.
  • In adult social care, as of 31 March 2024, 418,029 people were waiting for an assessment, the commencement of their care package or direct payment, or a review of their care plan. Unmet or under-met needs that flow from waiting times in adult social care may lead to greater reliance on unpaid carers. In 2021 there were 2.4 million unpaid carers providing 20 hours or more care weekly, up by 17.3 per cent from 2011. The Nuffield Trust say this ‘indicates a shift towards unpaid carers supporting people with high care needs who may well have drawn on formal care in the past’.
• Reduced spend on preventative services: The growing share of council spending focussed on meeting their statutory obligations has also led to a greater focus on reactive, demand-led spending, such as on temporary accommodation, and a reduction in spend on preventative services. This is despite the growing body of evidence of the financial and social benefits of prevention. For instance, reductions in spending on preventative services for adolescents is highly correlated with rising rates of 16 and 17-year-olds entering care. Equally, sport and cultural services can boost productivity and reduce pressure on the NHS and social care services. Overall, a system in which councils only have sufficient resources to meet demand-led need is likely to offer poorer value for money than one where they are able to invest in preventative measures to manage demand.

Workforce sustainability

Recruitment and retention challenges

A key challenge facing councils in maintaining service sustainability is the growing difficulties in relation to workforce recruitment and retention. LGA research has demonstrated that more than nine in 10 councils are experiencing staff recruitment and retention difficulties. Further evidence produced by the LGA this year demonstrates the particularly acute situation in legal services, finance, adult social care, IT, building control and environmental health. Also: 

• In children’s social care Department for Education (DfE) statistics show that the current vacancy rate, the level of children and family social workers leaving during the year, and the sickness absence rate are all the second highest in their data series and higher than pre-pandemic. Children and family social workers report significant increases in their stress levels and workloads over time.
• In adult social care the workforce vacancy rate remains high at 152,000 vacant posts a day in 2022/23 (although this is down from a high of 165,000 in 2021/22 due, in considerable part, to the addition of care workers to the Shortage Occupation List). Turnover rates remain high at 28.3 per cent in 2022/23. On average, care workers with five or more years of experience are paid just 6p per hour more than a care worker with less than a year’s experience. The differential was 33p per hour in March 2016. Four out of five jobs in the economy pay more than care worker median pay.
• The LGA’s 2022 workforce survey revealed more than half of county, district and single tier authorities who responded are experiencing difficulties recruiting planning officers. In 2023, the LGA launched the Pathways to Planning graduate recruitment programme in response to this challenge. In less than a year, Pathways to Planning registered interest from over 30 per cent of the local planning authorities in England and received more than 2,200 applications from graduates. The programme recruited 80 planners in 2023/24 and has the potential to deliver up to 120 new planners every year. The key obstacle to the programme’s growth is local planning authorities’ limited funding: up to 50 per cent of councils who expressed interest in the programme in 2023/24 could not create a new graduate post or fill a vacant post due to financial pressures within the local authority.

National Living Wage

There are multiple factors underlying the sector’s workforce issues, but recent Government policy on the NLW has certainly added further challenges. Over the last few years, significant increases to the NLW have meant pay awards to the 1.4 million people covered by collective bargaining in local government have been heavily weighted towards the lower end of the pay spine leaving the pay rates of middle earning professionals in the sector out of touch with comparable employers not just in the private sector, but in other parts of the public sector too. This exacerbates the recruitment and retention issues reported by 94 per cent of councils that means key roles needed to deliver front line services are vacant.

Local government is supportive of the NLW and understands the Government’s desire to ensure the cost of living is one of the considerations of the Low Pay Commission when recommending changes to the NLW rate. It is imperative, however, that the Government supports that policy by ensuring local government receives sufficient additional funding to ensure the sector can accommodate an increasing NLW in a workable manner. This also applies to the Government’s commitment to “improve public service workers’ living standards throughout the parliament”, which requires a level of sustainable funding for local government that allows the sector to invest in its workforce.

Policy decisions on the NLW must also consider the impact on public sector employers and the services they provide, in particular, social care. It is not in the best interests of the wider economy for the policy towards the NLW to result in reduced public services and local investment if councils are not appropriately funded to meet the additional costs that result. Existing capacity issues in both local government and social care will be exacerbated if NLW commitments are not matched by funding commitments to the sector.

Local government pay competitiveness

The limits of funding and the accelerated increase of the NLW in recent years have exacerbated local government’s pay comparability not only with the private sector, who compete for key professionals in areas like building control, planning and law, but also the public sector, most commonly the NHS. To illustrate the difficulty the sector is in; while the recent announcements on public sector pay mean that social workers in the NHS will receive a pay award of 5.5 per cent, with the required funding made available to their employers; social workers in local government are likely to receive an award in the region of 3 per cent because the full and final offer made by the National Employers, which is at the limit of affordability for employers, has to be weighted towards the lower end of the pay spine as a result of the need to comply with the NLW.

With two of the nationally recognised trade unions announcing formal ballots for industrial action in response to the National Employers’ offer, it is imperative that decisions made regarding funding for one group of public sector workers who are subject to Pay Review Bodies are not at the expense of another group whose pay is set through collective bargaining. The LGA understands the Government’s priority to introduce a new deal for working people and is keen to work with government, for example on the reinstatement of the Schools Support Staff Negotiating Body and the Fair Pay Agreement for Adult Social Care and we hope that existing collective bargaining is not disadvantaged when the Government is considering the funding level for the sector.

Apprenticeships

Councils have paid almost £1 billion into the Apprenticeships Levy since 2017 but have only been able to spend around £485 million (49.9 per cent) due to the restrictive rules around its usage. To date almost £200 million has been returned to HMRC meaning that while council funding is stretched to breaking point in many places, the sector is losing money that it would like to be able to use to bring together the two key objectives of improving local government workforce capacity and improving skills and opportunities in local communities. The Government should allow councils to retain unutilised apprenticeship levy, to be able to redirect that resource into improving local government workforce skills and capacity.

An outdated and inefficient funding system

The financial challenges faced by councils have been exacerbated by a local government funding system which has not been subject to significant reform since the introduction of 50 per cent business rates retention in 2013/14. Councils operate in a dated, patched-up system where financial planning is hindered by a drip feed of one-year finance settlements and financial sustainability is increasingly secured by one-off grants or Exceptional Financial Support from Government.

A crucial issue is that councils’ ability to mitigate the funding and demand pressures they face has been hampered by one-year funding settlements and continued uncertainty over funding reforms. These act as obstacles to councils making innovative and meaningful decisions, limit their ability to focus on long term strategic and economic planning, and undermine their financial sustainability. The potential to deliver maximum value for money is held back by uncertainty and a limited ability to plan for the future. For instance, councils may end up planning on the assumption that they will have less funding available to them than is the case, needlessly scaling back non-statutory services and making redundancies.

The system has effectively been drifting for a number of years. The last major reform of revenue funding arrangements took place in 2013/14 with the introduction of the system for 50 per cent local retention on business rates. As a consequence, key elements of the funding system, including the data and formulae at the heart of the allocation model, have not kept pace with changed patterns of need and demand locally. The IFS has estimated that only 39 local areas out of 150 in England receive a share of funding that is within 5 per cent of their share of estimated spending needs.

Overall, the funding system is out of date, opaque, and overly complex. It also limits the ability of councils to be more self-sufficient by raising income from other sources. The system needs reform urgently.

Actions to support council finances over the short and long-term

While there is a strong case for wholesale reform of the local government funding system, the pressing nature of the challenges faced by the sector means that immediate interventions to help stabilise councils’ finances are also needed. We think there are a range of interventions the Government could take now to simplify and create certainty within the funding system, realign funding with assessed need and add flexibility to current funding sources. 

In order to address the immediate financial pressures faced by councils Government should:

• Provide additional funding and certainty. Government should:
  
  • Provide councils with a significant and sustained increase in overall funding that reflects current and future demands for services.
  • Provide councils with multi-year and timely finance settlements.
  • Provide general rather than ring-fenced grant funding, reduce the fragmentation of government funding and end the use of competitive bidding to allocate grant funding.
• Update data and formulae in the allocation model. Government should:
  
  • Commit to the Fair Funding Review (FFR), reviewing both the formulae and the underlying data used for the assessment of relative needs and resources. Transitional mechanisms attached to the outcome of the FFR should provide sufficient funding to ensure that no council experiences a loss of income.
  • Provide certainty over financial reforms including the business rates reset, the FFR, and reforms to other grants such as the New Homes Bonus, and consulting on any potential changes in a timely manner. 
• Provide additional freedoms and flexibilities. Government should:
  
  • Give councils the power to vary all council tax discounts including the single person discount which is worth around £3 billion a year.
  • Abolish council tax referendum limits so, in due course, alongside the completion of the FFR, councils and their communities can decide what increase in council tax is warranted to help protect or improve local services.
  • Enable councils to charge developers or landowners full Band D council tax for every unbuilt development in order to improve the build-out rates of homes with planning permission and reduce the number of stalled sites.
  • Give councils more flexibility on business rates reliefs such as charitable and empty property relief and introduce further clampdowns on business rates avoidance along the lines of those introduced in Wales and Scotland.
  • Give councils the ability to set their own business rates multiplier, or at the very least be able to set a multiplier above and below the nationally set multiplier.
  • Fully localise sales, fees and charges, including road user charges and workplace parking levies. Give councils the flexibility to set planning fees at a local level so that can they cover their full costs relating to planning.
• In order to address the need for more substantive, long-term reform of the funding system:
  
  • There should be a cross-party review of, and debate on, options to improve the local government funding system.
  • There is a need for a fundamental review of council tax alongside other council funding sources. We urge all stakeholders to engage in this debate and to seek a sector-wide, cross-party consensus on the future of council tax.
  • The review has to include consideration of whether business rates retention represents a viable future funding model.

A revised funding model should include bold, creative solutions. Alongside any reforms to existing funding sources, devolved or new funding streams are needed to supplement existing council revenue resources. A reinvigorated debate around additional and/or alternative forms of local income for councils needs to begin now. Equally, any reform of council funding should also consider how spending is best co-ordinated across the range of public bodies delivering services locally. Government should: 

• Consider assigning each local area a proportion of nationally collected taxes. It would be for local politicians in partnership with local providers to decide on priorities and the allocation of funding.
• Consider alternative sources of income for local government such as an e-commerce levy or ‘tourism tax’ with the funding retained by local government.
• Consider introducing multi-department place-based budgets, explicitly built around the needs of diverse local communities – with a shared financial and governance framework which will mean that services can better align with local priorities and local duplication of efforts can be eliminated.

Pressures outside the General Fund Revenue Account

The preceding material has focused on issues affecting councils’ General Fund Revenue Accounts. But there is growing evidence that councils face financial challenges across the full range of their finances. Councils’ Housing Revenue Accounts are increasingly under pressure (see Priority 3 section on “Building the houses we need”). Some councils are also face growing deficits in the high needs block of their Dedicated Schools Grant (see Priority 4 section on “Supporting our children and young people”).

Pressures on councils’ capital programmes

There is also growing evidence of pressure on councils’ capital programmes. These council investment programmes play a crucial role in delivering local capital infrastructure, such as transport and roads, economic regeneration and housing and school improvements. Capital investment by councils will be crucial to delivering the government’s missions, as well as making the public sector more efficient.

Declining infrastructure

Since 2017/18 English councils have spent between £20 billion and £22 billion each year on capital investment; this has proved to be insufficient and has left local authorities with a significant capital backlog.

For schools, according to the NAO, in its 2020 Spending Review case the Department for Education (DfE) estimated that £7 billion was needed for best-practice level of annual funding but also recommended minimum capital funding of £5.3 billion a year for maintenance and to mitigate the most serious risks of building failure. Since then, in 2021/22 and 2022/23, DfE was allocated £1.8 billion for maintenance and repair, and an average of £1.3 billion a year for schools rebuilding, a shortfall of more than £2 billion per year on the figures for most serious risks of building failure, and nearly £4 billion per year on best practice.

In terms of local roads maintenance, figures in the ALARM survey 2024 by the Asphalt Industries Alliance show that the amount of outstanding roads maintenance at March 2024 for England and Wales is now £16.3 billion. The work to address this would take a decade to complete. The NAO in its report on the condition and maintenance of local roads in England, has estimated that the “England” share of this backlog is £15.3 billion.

The estimated combined backlog is in excess of £20 billion for these two areas alone. These are just two high profile areas of local government. There are many others – for example, LGA research in 2021 demonstrated a need for an additional £875 million capital investment in leisure facilities, pitches, and parks. The overall backlog for all services must be well in excess of £20 billion. Addressing this crumbling infrastructure, through long term investment, needs to be a priority for this spending review.

Increases in borrowing costs and inflation

Prudential borrowing relies on councils having sufficient revenue funding to pay interest and repayments; a £20 billion capital backlog would need ongoing revenue funding of £1 billion per year to service interest costs. Funding from government grants relies on long term investment through the spending review and beyond. 

Over 80 per cent of recent capital programmes have been funded by government grants and prudential borrowing, in broadly equal measure. The continuation of the Prudential Framework is crucial to the delivery of council capital programmes. The overall framework for capital finance should continue to allow local authorities wide freedoms to borrow and invest, without the need to seek prior approval from government.

Inflation on capital spend has reduced what local authorities can buy with available capital funding. The index of construction costs rose 20 points between late 2021 and summer 2024. This was equivalent to the rise over the whole of the previous seven years (2014 – 2021). As a result of this, the same level of capital outlay on construction can now can only deliver just over 80 per cent of the infrastructure that it could in 2021. Or, in other words, the same amount of capital construction will cost 20 per cent more. 

At the same time, council capital programmes have been hit by rising interest rates. Since 2020, Public Works Loans Board rates have grown significantly, from below 1.5 per cent in November 2020 to more than 5 per cent in summer 2024. This means that for the same interest cost, a council can now borrow less than a third of what it could in November 2020.

Taking the impacts of inflation and interest rates together, councils capital programmes are under significantly more pressure. In simple terms, a £1 million construction project in 2021 and funded by a typical 10-year loan, would have an outlay of £1 million funded by a loan which would incur interest (at 1.5 per cent, £15,000 per year) of £150,000 over 10 years, a total of £1.15 million when the loan is repaid. If the same scheme were started in 2024 it would have an outlay of £1.2 million to be funded from a loan which would incur interest (at 5 per cent, £60,000 per year) of £600,000 over 10 years, a total of £1.8 million when the loan is repaid. This is an increase of nearly 60 per cent.

Prevention means intervening at the earliest practical opportunity to improve outcomes. It also means taking a more long-term, broad-based approach to spending decisions to ensure that short-term savings do not impair more enduring social and economic outcomes. Services for children and families are particularly crucial within this life course approach. But it is possible to intervene early in problems that present throughout people’s lives, and to create places and institutions that in themselves foster health, wellbeing and prosperity.

Research consistently highlights the sustainable improvements to health, wellbeing and prosperity that can be achieved through a preventative approach to government spending decisions, and the design and delivery of local services. Yet we have seen a significant reduction in early intervention funding, and a shift in the profile of council spending as they battle to meet growing demand pressures in acute and frontline services with desperately limited resources.

There has also been a growing recognition of the importance of applying a prevention lens to a wider range of public services, to the extent that a number of researchers including DEMOS and the Institute for Government have called for prevention to be considered as a key component within all government spending decisions.

The role of local government and public services

Prevention as an approach

It is important to recognise that prevention can happen throughout the life course and at all points along a continuum of need. As the Care Act guidance highlights: ‘at every interaction with a person, a local authority should consider whether or how the person’s needs could be reduced or other needs could be delayed from arising’ (DHSC, 2016).

There are also key points throughout the life course where preventative support is likely to be most beneficial. For example, support for parents and children during the early years and during the transition from childhood to adulthood can be crucial for children’s health, life chances and social mobility. The LGA would like to work with the Government to develop a more preventative approach across all public services, and we have set out our key service-based asks throughout this document.

However, these service-specific approaches will not succeed unless we also invest in the right foundations. For instance, research on health and wellbeing stresses the vital importance of considering the wider determinants of public health, and effective joint working across services and partners. Equally, research on outcomes for children and families highlights the importance of material wellbeing and the long-term harm caused by poverty and disadvantage. Likewise, we increasingly understand the benefits of green spaces, cultural amenities and inclusive economies to our collective wellbeing, and the threat to us all if we do not address the climate and biodiversity crisis and work more effectively towards net zero.

Improving the evidence base

There is some good, recent evidence on the long-term benefits of investing in prevention, for example from the Sure Start programme the Supporting Families programme and FutureBuilders. However, research is not always comprehensive or consistent, and there is a growing recognition of the importance of applying a prevention lens to a wider range of public services, as seen for example in the current project being led by CIPFA. We want to work with the Government to develop a more consistent, long-term approach to cost-benefit analysis that enables government, councils and partners to consider both reduced demand pressures in acute services over time, and wider social return on investment.

Many places are already taking a structured, long-term approach to assessing social return on investment, and undertaking cost benefit analyses of preventative approaches.  For example the London Borough of Newham, the Greater Manchester Combined Authority and the London Borough of Camden. However, the capacity of councils to undertake this type of activity has been reduced in recent years.

Adopting an integrated approach

Recent research on prevention highlights the vital importance of integration and partnership working. The challenges that people face can be complex, and the solutions equally so. We are pleased that the Government is taking a more joined-up approach across departments to tackling cross-cutting challenges like child poverty. It is equally important that councils and partners are able to take a similarly strategic and integrated approach locally.

A very short-term, ring-fenced approach to funding, as seen for example with the repeated allocations of Household Support Fund, makes it extremely difficult for councils to address challenges in a more strategic and sustainable way. A more preventative, long-term approach to local welfare support would, enable councils to develop a deeper understanding of what is driving need in their local area, and to embed effective referral networks across health, income maximisation, social care, housing and employment support.

Many short-term initiatives are due to end within the current financial year. These include the Holiday Activities and Food Fund and Family Hubs.

Actions to support councils

To help councils embed prevention as an underpinning approach, and to build the evidence base on the effectiveness and contribution of different forms of preventative spending, the Government should work with councils to:

• Take a more long-term, preventative approach to funding and decision-making.
• Strengthen our understanding of which investments maximise improvement outcomes in the short, medium and long-term, and develop a more sophisticated understanding of social return on investment.
• Develop a more integrated, evidence-based approach to addressing the wider determinants of health and wellbeing.
• Recognise the fundamental and universal importance of the environment and public realm to supporting health, wellbeing and prosperity.
• Ensure that everyone has sufficient basic resources and financial stability to be healthy and well and access opportunity, including through national policy on benefits, housing and employment support.
• Develop a more consistent, long-term approach to cost-benefit analysis that enables government, councils and partners to consider both reduced demand pressures in acute services over time, and wider social return on investment.
• Restore the capacity of councils to both pilot and evaluate preventative services, analysing impacts across a wide range of outcomes and over time, to get a more in-depth understanding of where investment is most effective.
• End short-term, prescriptive grants; move towards shared outcomes frameworks, and enable greater freedom and flexibility in place-based budgets and decision-making so that councils can plan and invest in integrated services that meet the specific needs of their local communities.

Specific preventative activities and approaches

We set out a range of preventative approaches throughout the following sections of this submission. These include more integrated, effective services for families and children, in particular during the early years; measures to improve housing affordability and prevent homelessness; and more localised approaches to employment support. Ahead of this we want to focus on some other areas of council and public spending that we feel provide a powerful preventative effect and represent good value for money.

The benefit system

Council services operate as part of a system that is greater than the sum of its parts; people often face complex challenges that cannot be addressed in isolation. Material disadvantage is often both a cause and consequence, which can be reduced over time through an effective relationship between the welfare system and wider public services.

Therefore, in addition to promoting preventative approaches within council services we would also call on Government to:

• Ensure that the mainstream benefit system meets essential living costs and continue to uprate benefits at least in line with inflation.
• Review all welfare reforms that place additional conditionality on specific individuals and households to ensure that they are not increasing hardship. For those reforms that may increase hardship, work with councils and stakeholders to amend them as necessary over time.
• Ensure a planned succession to the Household Support Fund, that enables local welfare schemes to be maintained and work with councils and the LGA to design a more sustainable, preventative approach to local welfare support in the longer term.
• Provide additional funding to the DfE to implement a national approach to automatic enrolment for free school meals.
• Work with the Department for Work and Pensions (DWP), councils and the LGA to continue to strengthen data-sharing to increase benefit take-up, support income maximisation and ensure quick and timely access to debt / money advice.
• Empower and adequately fund councils to better shape locally how they engage with their communities.
• Review the current £7,400 income threshold for free school meals, which has remained unchanged since its introduction in 2018, to reach more children who are on the cusp of experiencing food poverty as household budgets are squeezed by rising prices and inflation.
• Ensure that funding is retained for locally-led and integrated approaches to early help when the current phase of Supporting Families funding ends in 2025. Draw on councils’ learning and the national evaluation and restore the previous emphasis on poverty prevention that enabled successful outcomes during phase 2 (Troubled Families).

Public health services

The health of the nation requires long-term upstream investment across a wide range of policy areas. If we fail to recognise this, we will only store up more problems for the future across all public services. Public health expenditure is relatively cost-effective compared with health care expenditure. Failure to invest in these vital preventive services will mean health worsening, further widening health inequalities, and the costs of dealing with this poor health will be felt across society and the economy.

Local authority public health interventions funded by the public health grant provide excellent value for money, with each additional year of good health achieved in the population by public health interventions costing £3,800. This is three to four times lower than the cost resulting from NHS interventions of £13,500. Analysis by the University of York suggests that the expenditure through the ring-fenced public health grant is three to four times as cost-effective in improving health outcomes than if the same money had been spent in the NHS baseline.

For local councils and their partners to improve the health of the nation, we need:

• More investment in the public health grant and in other vital areas of public health and prevention. At a minimum, funding should be restored to the public health grant, which has suffered a cut of 27 per cent in real terms since 2015/16.
• A formal exercise to ensure that the public health grant and the mandated functions that local authorities must deliver, are costed (e.g. how much would it cost to deliver all elements of the Healthy Child Programme?).
• A review of the public health grant and how it is distributed taking into consideration significant changes in population, deprivation and need. These are changes that have not been taken into full consideration since the transfer of responsibility of public health services to local government in 2012.
• Investment in services, such as health visiting, that give children the best start in life. This investment reduces demands on GPs, hospitals and social care. It means children start school ready to learn and to achieve, so our schools can be more effective.
• Multi-year settlements for the public health grant and a stronger alignment with the annual local government funding settlements. It makes little sense to treat funding for local government separately and in a piecemeal way.

Culture and leisure services

Councils are the largest public funders of culture, sport and leisure nationally, spending £2.6 billion a year in England on these services. They run a nationwide network of local cultural and leisure organisations, which in England includes 3,000 libraries, 2,727 leisure centres, over 350 museums, 116 theatres, 27,000 parks and green spaces and numerous castles, amusement parks, monuments, historic buildings and heritage sites. This core funding sustains our civic infrastructure and keeps vital universal services running.

Council museums, library and leisure centres provide trusted community hubs that are visible and valued by their communities, and may be the last public service available in smaller towns and villages. The flexibility of these services and their assets means that they are constructive, non-judgemental and effective places to co-locate other services, ranging from employment support, health services, to youth engagement. Museums and libraries offer excellent educational opportunities to those who thrive best outside of an academic environment, or who lack the resources and space at home to study effectively; as well as for boosting early life chances.

As the Government looks to deliver its manifesto commitments around the new community hubs, it must explore co-location within existing facilities first, strengthening the financial sustainability of both the new and the old service. These services also act as major opportunities for volunteering, enabling volunteers to develop new employable skills, boost their mental health and resilience, and remain active for longer.

The NHS relies on leisure facilities to provide exercise on referral schemes, social prescribing activities and rehabilitation services, with 66 per cent of cancer rehabilitation taking place in leisure facilities. Ninety four per cent of councils’ leisure centres had been utilised in schemes to tackle health inequalities over the last five years. Eighty four per cent confirmed that their leisure centres had been utilised in projects aimed at ‘hard to reach’ community members over the last five years, and 79 per cent of leisure centres are used in social prescribing programmes.

Research shows physical activity saves the NHS £9.5 billion every year by preventing illness, and generates £85 billion annually in economic value. Of this saving, £5.2 billion was in healthcare savings, while £1.7 billion was in social care savings. For every £1 spent on community sport and physical activity, £3.91 is generated for the English economy and society.

Supporting an additional 1,000,000 people to be active would deliver:

• Almost 45,000 diseases avoided.
• A direct saving to the NHS of £314 million for the cost of treatment of those diseases.
• Seventy thousand Quality Adjusted Life Years (QALY) gained (a year of life in perfect health is equal to one QALY). This gain has a health value of £1 billion and economic value of £4.2 billion.

The following steps are necessary in order to ensure that councils’ culture and leisure services are able to deliver these benefits:

• We want to see as a first step immediate implementation of the Hewitt report recommendation that the share of total NHS budgets at Integrated Care System (ICS) level going towards prevention increase annually by at least 1 per cent over the next five years, which should include commissioning strategies overseen by Integrated Care Partnerships.
• Within the first year of a new Parliament a ‘Preventive Health Strategy’ should be developed that addresses the wider social determinants of health, and all departments, overseen by a cross-departmental ‘Prevention Delivery Unit’ designed to inspire action and monitor delivery.
• Government must also commit to a common standard of data collection, evidence and impact assessment as required by the ICS locally and government nationally.
• LGA research in 2021 demonstrated a need for an £875 million capital investment in leisure facilities, pitches, and parks. This strategic investment would help build or refurbish 25 new facilities each year over a three-year period, creating a network of hubs specifically designed to help people become more active in their everyday lives.

English civic museums have faced particular changes due to their stewardship of historic buildings, which are inherently costly to run and maintain, while their ability to generate income has been constrained by the cost of living pressures facing many facilities. Their choice has been between raising prices and reducing access to the learning and wellbeing benefits for those on lowest incomes, or to subsidise costs from their reserves. Neither is a sustainable approach to maintaining our heritage and inspiring creative individuals for the future:

• Government will need to identify a continuation or replacement of the Museum Estate and Development fund, and provide an immediate injection of funding of around £20 million to prevent immediate closure of key facilities across the country. This funding should support transformation of the service towards a more sustainable delivery model, focused on boosting inclusive access and cohesion.

The Government has started to set out its plan to get Britain building. It recognises that there are significant ongoing challenges in ensuring everyone can live in a home that meets their current and future needs – challenges that encompass availability, affordability, security and quality.

Councils share the Government’s commitment to build more homes. We welcome the measures taken so far, including immediate reforms to Right to Buy and a commitment to ban “no fault” Section 21 evictions. These measures will have a significant impact on councils’ ability to deliver genuinely affordable, high-quality homes, and relieve pressure on homelessness services.

We can now go further to deliver more council homes and end homelessness.

Cost and demand pressures

Housing crisis

The housing crisis is worsening due to the limited availability, affordability, and suitability of homes. The average house price in England is now 8.3 times average annual earnings, with the ratio exceeding 12 in 60 local authority areas. Younger generations are particularly affected, consistently ranking housing among their top concerns. The failure of housing supply to keep pace with population growth, combined with rising construction costs, has further constrained availability. Inflationary pressures, including an 11.5 per cent increase in new build costs since 2021, have made it more difficult to build affordable homes.

The Right to Buy scheme has significantly reduced the stock of social housing. Since 2012, over 110,000 social homes have been sold, while only 44,000 have been replaced. Our research predicts that a further 100,000 homes will be sold up to 2030, with only 43,000 replaced – a net loss of 3.61 per cent of stock over that period alone.

Councils face challenges in securing private rental properties due to affordability issues, especially in high-demand areas. The private rented sector is now the main driver of homelessness, with nearly 26,000 households facing homelessness in 2023 due to Section 21 "no fault" evictions.

The number of households in temporary accommodation has surged by nearly 90 per cent in the past decade, now exceeding 117,000, including 151,630 children. The cost of temporary accommodation has soared to £1.75 billion, with a projected 19.9 per cent increase in 2023/24 alone. Most of this cost cannot be recouped by councils due to limits on temporary accommodation housing benefit subsidy, which is frozen at 90 per cent of 2011 Local Housing Allowance (LHA) rates. To illustrate, in 2022/23 councils in England spent £936 million on housing benefit expenditure towards the total temporary accommodation bill and were only reimbursed £731.5 million by the DWP. This subsidy gap diverts funds away from preventative measures and perpetuates a costly cycle.

Housing Revenue Account (HRA)

The self-financing settlement in 2012 distributed debt to stock-holding councils on the assumption that anticipated rent income would be sufficient to fund works to raise all homes to the Decent Homes Standard (DHS) and maintain them there, and also to pay off debt over a 30-year period. The settlement is over 10 years old and no longer viable, with outdated assumptions on income and expenditure. Income within the HRA is not only now lower than that anticipated in the settlement, but this income is now expected to cover both higher costs and higher standards of stock and service delivery.

The 7 per cent rent cap imposed for 2023/24, whilst supporting tenants in the short-term, will amount to a cumulative deficit to council HRAs of £664 million after two years. This follows previous annual 1 per cent rent reductions for four years from April 2016, resulting in an estimated 12 per cent reduction in average rents by 2020/21.

The impacts of these rent reductions alongside the recent spike in inflation is now apparent in councils’ HRAs. Our analysis of councils’ HRA budget data from 2015/16 to 2024/25 shows that:

• Budgeted HRA income has fallen in real terms by £1.2 billion (10.3 per cent) in this period.
• Budgeted HRA operating costs have fallen by only £410 million (4.7 per cent) in real terms over the same period.
• This has squeezed the ‘surplus’ available to councils which is used to service debt, build reserves, or contribute to HRA capital programmes.
  • Budgeted reserves have fallen from a real terms peak of £3.8 billion in 2019/20 to £2.8 billion – a 28.1 per cent reduction.
  • Annual budgeted revenue contributions to capital have fallen in real terms by £859 million (58.6 per cent) from 2015/16 to 2024/25.

Overall, councils’ have not been able to reduce their operating spend in line with the fall in their income. As a consequence, debt servicing costs now account for a growing share of HRA ‘surpluses’ where they still exist. An increasing number of councils have had to address end of year deficits by drawing on their dwindling reserves. At the same time, councils’ ability to supplement their HRA capital programmes from their revenue resources has been severely curtailed. These are worrying signs in terms of the financial sustainability of councils’ HRAs.

Updated 2024 research by Savills, shows that the additional costs to deliver net zero, compared to what is currently provided for in HRA business plans, is £25 billion from 2025 to 2052. The sector-wide requirement to achieve building safety standards for tall buildings and buildings housing vulnerable residents is also estimated to be £6.5 billion between 2025 and 2030. Other additional unanticipated expenditure costs include an updated Decent Homes Standard, the professionalisation of social housing staff and the requirement for councils to pay for the cost of social housing regulation. To illustrate, it is estimated that new qualification costs will be between £8-15 million per year, with over £50 million per year in backfilling costs to cover staff attending training courses. 

A long-term sustainable funding framework for social housing is vital to ensure that councils have the ability to invest in and regenerate their housing stock, and to fulfil local and national ambitions of ensuring that everyone has access to a safe, secure and high-quality home. The Government’s commitment to provide certainty on rents at the next fiscal event should include a minimum 10-year rent settlement, a continuation of the link between annual rent increases and inflation, and a restoration of lost revenue due to historic rent caps/cuts and the removal of rent convergence.

The offer from councils

Housing supply

The Government has signalled its intent to enable a council housebuilding revolution. Councils know that this would: provide a counter-cyclical boost to housing supply; offer a pathway out of expensive and insecure private renting towards home ownership; reduce homelessness; tackle housing waiting lists; and support the growth of green skills and net zero supply chains. 

Long-term certainty on powers and funding could help councils scale up to deliver an ambitious build programme of 100,000 high-quality, climate-friendly social homes a year. It would also improve the public finances by £24.5 billion over 30 years, including a reduction in the housing benefit bill and temporary accommodation costs.

This should include giving councils certainty about the cost of borrowing, by allowing local government continued access to preferential borrowing rates through the Public Works Loan Board. Each additional £5 million provided through this scheme is estimated to provide up to £150 million in savings and additional investment into social housing.

Rolling out five-year local housing deals by 2025 to all areas of the country that want them – and combining funding from multiple national housing programmes into a single pot - will provide certainty and efficiencies and could support delivery of an additional 200,000 social homes in a 30-year period. This will improve public finances and reduce the housing benefit bill.

Giving councils the powers and flexibilities to use the Right to Buy scheme and receipts in their local area will help protect existing valuable social stock and allow councils to invest in the direct delivery of new stock or acquisitions.

Disused and derelict land held by the public sector provides opportunities for development and community regeneration. However, viability issues prevent many of these sites from being taken forward. Further investment in the Brownfield Land Release Fund (BLRF) and One Public Estate (OPE) programmes would help to progress these developments, with the opportunity for speedy release of land and housebuilding on small health and blue light sites. In addition, investing in such support to consolidate the public estate enables capital generation and revenue savings, and supports better and more cost-effective public services delivery in place, helping councils to balance budgets today and to reduce future demands.

Some 261,474 properties are classed as long-term empty homes – and these existing properties cannot be used to address pressing housing need. Many section 106 affordable units are “stalled” on sites where developers have been unable to sell to housing providers. Introducing a further round of the Local Authority Housing Fund (LAHF) would enable councils to acquire existing stock and unsold new builds for general needs usage, temporary accommodation, and asylum and resettlement cohorts It would also fund the provision of support.

Homelessness

Changes to the housing benefit regime, combined with the removal of the Supporting People programme in 2010, has meant that councils and government have very limited control and oversight over the quality and location of supported housing. As set out in a 2022 Levelling Up, Housing, and Communities Committee report, the Government did not have any overall figure for the amount spent through Enhanced Housing Benefit on supported housing.

This means there is no overall figure for homelessness-related spending which includes temporary accommodation, exempt accommodation, and the costs incurred by the many public services which support people experiencing homelessness – or for other forms of temporary accommodation, e.g. for refugees.

There are opportunities to spend money more effectively. This will not be costless, but the upfront costs will be repaid over time through savings to health and social care budgets, improvements in educational attainment and reductions in short-term expenditure on temporary accommodation.

The current temporary accommodation subsidy, frozen at 90% of 2011 Local Housing Allowance (LHA) rates, now only covers a small part of councils’ temporary accommodation. This forces councils to divert resources from homelessness prevention to cover the shortfall. Aligning subsidy rates with 2024 LHA levels would provide immediate funding for prevention efforts, reducing the need for temporary accommodation in the longer term.

Providing councils with ringfenced funding to commission supported housing would bring this market back under local authority oversight: preventing unscrupulous providers from claiming high levels of housing benefit, enabling new commissioning to be subject to a strategic assessment of local needs and supply, and improving control over the quality of accommodation for vulnerable people.

There is a need for greater sector-led support to provide additional capacity and improvement support tools for councils. Government support to set up a new local Housing Advisory Service would enable councils to share good practice and create efficiencies across the sector.

Procurement

Uncoordinated public sector procurement of private housing has driven up local accommodation costs. Agencies like the Home Office and Ministry of Justice compete against councils for the same properties, often leading to inflated prices. Once procured, accommodation may be “reserved” for specific cohorts, leaving large numbers of properties void in areas where the demand from those cohorts is not sufficient to meet supply – despite high levels of overall housing need in those areas.

A cross-system approach to procuring accommodation and support, with local government involvement, would create significant efficiencies. It would also deliver a more sustainable and equitable system for asylum and resettlement. It would reduce the use of expensive hotels by building a system that can respond flexibly to changes in arrival numbers, providing better outcomes for individuals and supporting cohesive communities.

Contracts with large-scale asylum providers have a break clause in 2025/26, and then end in 2029. This provides an opportunity to explore and test new models in collaboration with local government.

The benefits of investing in prevention to address homelessness 

Prevention is the most effective way of addressing homelessness, both in human terms, and for the public purse. Analysis conducted by Local Partnerships for the LGA estimated cost to outcome savings ratios of up to £10.92 for every £1 spent from homelessness prevention initiatives.

Many of these benefits derive from joint commissioning between agencies, using combined resources. However, there is currently limited resource for upstream homelessness prevention, and limited means of measuring the benefits which may accrue to the wider public sector.

A flexible, multi-year prevention funding settlement, routed through local homelessness strategies, would provide the resource and certainty to join up services and improve outcomes for vulnerable households. Implementing stronger data linking between agencies would enable services to measure the impact of activities on joint housing, health, and employability outcomes, and deliver targeted commissioning based on cost/benefit assessments.

The drivers of homelessness are spread across multiple government departments’ policy areas – including justice, asylum, hospital discharge, and social care. However, these wider government policies are not strategically aligned with MHCLG’s ambition to end homelessness.

A cross-government strategy and action plan for preventing homelessness would help to establish prevention as a shared responsibility. This should include a commitment from departments to assess policies for their impact on homelessness. The LGA has already conducted extensive engagement with councils and the wider homelessness sector on the specific commitments which could form part of this strategy.

Continuing to up-rate LHA to the 30th percentile of local rents beyond 2025/26 is crucial to prevent homelessness. Previous LGA analysis shows that for every 1,000 households experiencing a shortfall between LHA rates and rent, 44 will require temporary accommodation.

Actions needed to support councils

In order to support councils to increase the supply of housing Government should:

• Reform Right to Buy to support 1:1 replacement of existing social housing to avoid continued net loss of stock. This should include allowing councils to retain 100 per cent of sales receipts; permanent flexibility to combine receipts with other government grants; the ability to set the size of discounts locally; and exempting new build homes.
• Provide further investment in social housing by allowing local government continued access to preferential borrowing rates through the Public Works Loan Board for housing, with each additional £5 million provided through this scheme estimated to provide up to £150 million in savings and additional investment into social housing.
• Increase Affordable Homes Programme (AHP) grant levels per unit to deliver more new affordable homes and ensure inflationary pressures do not jeopardise continued delivery.
• Strengthen Housing Revenue Accounts via a long-term rent settlement of at least 10 years alongside restoration of lost revenue due to rent cap/cuts, to give councils certainty on rental income and support long-term business planning.
• The roll out of five-year local housing deals by 2025 to all areas of the country that want them – combining funding from multiple national housing programmes into a single pot. This will provide certainty and efficiencies and could support delivery of an additional 200,000 social homes in a 30-year period.
• Further investment in the Brownfield Land Release Fund and One Public Estate programmes, with the opportunity for speedy release of public land and housebuilding on smaller council, health and blue light sites.

In order to support councils to address homelessness Government should:

• Uprate temporary accommodation housing benefit subsidy rates to 90 per cent of 2024 LHA rates. This would help councils better manage the costs associated with temporary accommodation and create more resource for prevention.
• Ensure that LHA rates continue to be up-rated to the 30th percentile of local rents beyond 2025/26. This will help prevent a growing number of households from falling into homelessness due to the gap between LHA rates and actual rental costs.
• Introduce a flexible, multi-year, prevention funding settlement, routed through local homelessness strategies and underpinned by a multi-agency joint outcomes framework.
• Introduce a cross-government homelessness prevention strategy, including a commitment to assess the impact of policies on homelessness.
• Introduce a cross-departmental approach to the procurement of housing and support for cohorts including people experiencing homelessness, refugees and asylum seekers, or people leaving prison.
• Provide a further round of funding through the Local Authority Housing Fund, to enable councils to acquire empty properties for general needs accommodation, temporary accommodation, and asylum and resettlement cohorts, as well as fund the provision of support.    
• Provide £1.6 billion of ringfenced grant funding for councils to commission supported housing, improving value for money and quality.

Council support for children and young people is central to the delivery of the Government’s mission to break down barriers to opportunity. Children and young people are our future, yet too many do not have the happy and healthy lives they deserve. The prevalence of mental health problems has risen significantly, and many more children are diagnosed with Special Educational Needs and Disabilities (SEND), such as autism, and unable to access the support they need. The education system is generally not incentivising or prioritising inclusion. Cost of living pressures are affecting many families. For children in care, there is a lack of high-quality placements and escalating costs for those with the greatest needs.

These issues must be addressed to ensure children and young people receive the support they need, and that councils can make their full contribution to the Government’s mission.

Cost and demand pressures

Children’s social care

Rising costs in children’s social care have seen budgets go up by 11 per cent to £14.2 billion in 2024/25 compared to 2023/24. Expenditure on fostering and residential placements increased by 44 per cent between 2018/19 and 2022/23 despite the number of children in care rising by only 7 per cent in that time – largely due to increasing use of residential placements. Spend on private residential placements increased by 85 per cent over the same period, from £991 million to £1.8 billion. LGA research has shown that in 2022/23 councils paid for over 1,500 placements costing £10,000 or more per week – more than 10 times the number purchased at this price in 2018/19.

The number of children in care is now at its highest since current records began in 1994. The complexity of needs of children post-Covid has also increased as observed by Ofsted and social workers. This is placing additional pressure on councils and social workers, with more resource required to support each child and family.

Furthermore, councils are supporting ever-increasing numbers of unaccompanied asylum-seeking children (UASC) and care leavers. Home Office funding for these placements fails to fully cover costs. This is especially the case for former-UASC care leavers, who now make up 26 per cent of care leavers aged 19-21.

As funding has fallen, councils have focused their spend on meeting their statutory obligations. This has led to a reduction in spend on preventative services and a greater focus on reactive, demand-led provision.

Special Educational Needs and Disabilities (SEND)

Dedicated Schools Grant – high needs block deficits

Dedicated Schools Grant (DSG) and high needs funding pressures are one of the biggest challenges that councils with education responsibilities are currently facing. This is the result of an ever-increasing demand for SEND support and the growing number of children and young people who have an Education, Health and Care Plan (EHCP). DfE statistics show that at January 2024 there were almost 576,000 children with an EHCP, an increase of 11.4 per cent on 2023.

Independent research commissioned by the LGA and County Councils Network (CCN) has found that, despite bespoke financial support for some councils via the DfE’s ‘safety valve’ programme, many councils are running a ‘deficit’ on their DSG High Needs budget. The research shows cumulative deficits currently stand at £3.2 billion and are projected to rise to £5 billion by 2026.

While these deficits are currently held off councils’ budgets due to a temporary ‘statutory override on the treatment of DSG deficits’, councils face a financial cliff edge when this ends in March 2026. If the statutory override came to an end tomorrow, one in four councils surveyed for the report said that they would cease to be solvent within a year or less. Half of the survey respondents said they would be insolvent in three years or less.

We do not believe that the proposals set out in the Government’s SEND and Alternative Provision improvement plan will result in the increase in EHCPs either slowing down or stopping. Nor do we believe that the ‘Safety Valve’ programme nor the Delivering Better Value in SEND programme will result in council high needs deficits being eliminated in the absence of reform prior to March 2026. We are, therefore, calling for the Government to write off all high needs deficits as a matter of urgency to ensure that councils are not faced with having to cut other services to balance budgets through no fault of their own or their residents.

This must be accompanied by long-term reform to the SEND system, as set out in the LGA/CCN-commissioned research, which improves outcomes for all children with special needs and is also financially sustainable for councils. Reforms should focus on a new national vision and supporting framework of expectations, building capacity for inclusion in mainstream education, reforming the statutory framework for inclusion, preparation for adulthood, realigning powers and responsibilities, the role of the independent sector and developing a national workforce strategy. Reform is urgent and unavoidable and we are keen to build a consensus with SEND system partners on the shape of reforms.

DSG high needs deficits – cashflow pressures

In addition to the risk to councils’ finances posed by the end of the statutory override, the LGA and CCN research also identified immediate costs affecting councils with high needs deficits. Councils finance their deficits with cash, which cannot then be used to earn interest. Equally, if a council runs out of cash, then it will have to borrow to ensure it has sufficient cashflow to manage its day-to-day functions.

If the £3.2 billion in cash councils have used on their deficits had instead been placed in a bank or deposit facility earning 4 per cent annually the sector would have generated £128 million this year. On the same basis, the forecast deficit of £5.0 billion in 2025/26 means councils will lose £200 million in unearned income. And these estimates do not factor in instances where councils have had to supplement their cashflow by borrowing, which will be a significantly higher rate of interest.

While resolving the issue of high needs deficits overall is the priority, Government must give some consideration to the costs to councils of running the deficits in the meantime.

Home to school transport

Costs of home-to-school transport are escalating for children with SEND, driven by ongoing growth in the number of children with EHCPs. Budgeted net spend in 2023/24 is £1.4 billion, a 95 per cent cash terms increase since 2016/17.

Given the financial pressures created by growing demand for home to school transport the Government needs to provide additional funding to support councils, or to work with councils to identify ways to manage demand for, and access to, this service. These immediate measures should be accompanied by longer-term reform of home to school transport.

Youth services

During the period 2011 to 2021, funding of youth provision has declined in real terms from £1,058 million in 2011 to £409 million in 2021, and the number of youth clubs operating in local authorities (according to available data) has nearly halved between 2011/12 and 2018/19. There is significant variation in the scale of changes in spending and its effects. Over a third (34 per cent) of local authorities reduced their real-terms expenditure on youth provision by more than three quarters between 2011 and 2021.

Early years education and childcare

Councils have a duty to ensure families can access early years entitlements and are working with providers to deliver the expansion of funded early years education and childcare.

Funding for entitlements is insufficient, leaving providers to attempt to make up the shortfall, cross-subsidising the ‘free’ hours by charging families significantly more for hours outside of free entitlements. Minimum wage increases and inflationary pressures have left early years entitlements funding falling further behind the cost of delivery. Prior to the proposed entitlements expansion, there was estimated to be a real terms cut of 9 per cent by 2024/25 compared to 2021/22.This leads to instability in the system and higher additional costs for parents and carers. Furthermore, some providers are disincentivised from offering the funded entitlements leaving some families without access to these.

The Government should commission an independent review to establish the true cost of delivering early years entitlements in high-quality provision. This must be updated in line with inflation and minimum wage increases to ensure that funding for entitlements remains sufficient.

Youth justice

Council youth justice services, the police and their partners have an outstanding track record of working with young people to avoid them coming into the youth justice system. The number of first-time entrants to the justice system has fallen by 72 per cent since 2012.

However, the youth justice grant has been cut by half since 2010. These reductions are now threatening those successes with increases in reoffending and burglaries undertaken by young people. It is vital that the grant remains at least at its current level in real terms to ensure youth offending teams can continue with the positive work with young people that has delivered substantial reductions in youth crime to date.

The offer from councils

Investing in meeting children’s needs leads to improved outcomes and prevents significant societal costs.

Looked after children

Research for the Care Review estimated the societal cost of adverse outcomes for looked after children at £9 billion per year, while the ‘Big Five’ children’s charities found that a failure to invest in children’s social care now will lead to approximately £1 billion in additional costs to the Government in total over the next ten years.

Tackling the broken children’s social care placements market by investing in high quality placements for children in care will improve the outcomes for children as well as ensuring that placements provide good value for money. We also want to see: improved oversight - including financial oversight - of large providers of homes for children in care; work to improve transparency of placement costs; and consideration of options to cap or band placement costs and profit.

There is also a range of well-evidenced interventions that can reduce demand in children’s social care including:

• Family Group Conferencing (FGC) – evidence suggests that if ‘FGCs were to be rolled out across England, 2,293 fewer children would go into care in a 12-month period, which would save over £150 million within two years.
• Family Drug and Alcohol Courts (FDACs) – separate evaluations by the Centre for Justice Innovation and Foundations found that FDACs both save money for the taxpayer and support more children to stay safely with their parents rather than entering local authority care.
• There are a growing number of studies that report the return on investment from parenting programmes, which can be up to £15.80 per £1 spent.

Early years

High-quality, universal early years education is likely to be the highest-returning investment a government can make to improve social and economic outcomes for low-income families. It can close the disadvantage gap and ensure children’s needs, including special educational needs and disabilities, are recognised and responded to early. More than half of the gaps in achievement at age 11 are due to inequality that was already present at age five.

There is significant evidence of the long-term benefits of supporting children well in the first 1001 days. Separately, the Sure Start model has been shown to improve health and education outcomes for children.

Children’s mental health

Poor mental health is associated with disrupted schooling and lower levels of educational attainment with long lasting impacts over the lifetime, both to individuals and on the financial cost to services. One study found that overall annual mean costs to the public purse were 16 times greater for those with mental health problems.

• One study found that mental health programmes that focus on resilience and protective factors could result in cost avoidance of £2.11 for every £1 invested within two years, increasing to £14.38 over the long-term.
• Acute mental health care is expensive to the taxpayer and has a negative impact on children’s outcomes and family wellbeing. Investing in community treatment, such as new care models, could result in a reduction of £137 million in acute bed costs.

Youth services

Youth work is likely to deliver high value for money for the UK taxpayer due to the impact it has on young people’s mental health, wellbeing, educational and employment opportunities. There is an estimated return on investment between 3.2:1 to 6.4:1.

Productivity and prevention

A joined-up, long-term approach

Reducing demand for children’s social care services, holistically meeting children’s needs and improving outcomes goes beyond the influence of children’s services alone. By enabling services to work efficiently and effectively together, better use can be made of budgets and expertise across the public sector. To make this happen, co-ordination is needed from the very top. We want work to start immediately on a cross-government plan for children, identifying the ways in which all departments and their associated local agencies can support better outcomes for children – supported by improved budget sharing at a local level including:

• Action to build capacity in mainstream education to meet the needs of children and young people with SEND.
• Reframing roles and responsibilities across education, health and care to recognise the joint responsibilities within a local SEND system, encourage joint working, and align responsibilities with decision-making powers.

Councils must also navigate short-term and disjointed funding which means they are unable to plan for the long-term. Several funding streams are coming to an end in the next year leaving councils with a lack of clarity on the next steps and with valued members of the workforce seeking alternative employment before funding ends. This risks a significant impact on local service provision and therefore on children and young people’s outcomes and experiences. These funding streams include funding for family hubs, the Holiday Activities and Food Programme, Turnaround, the Million Hours Fund, reducing parental conflict programme and training for senior mental health leads in schools.

Preventative spend

As a nation, we waste public money by not providing the right support at the right time. The Early Intervention Foundation estimated the costs of late intervention for children and young people total £17 billion a year across public services. There is clear evidence that targeted intervention from the early years, and before birth, works in delivering much improved life outcomes for children at risk, while reductions in spending on preventative services for adolescents is highly correlated with rising rates of 16 and 17-year-olds entering care.

Social care workforce

Investment in the children’s social care workforce can help to address the challenge of significant numbers of social workers leaving the workforce. DfE statistics show that vacancy rates, turnover and sickness absence rates are all higher than pre-pandemic. Children and family social workers report significant increases in their stress levels and workloads over time. A failure to act is likely to see increasing numbers of social workers leaving the profession or moving to agency social work, leading to increased costs for councils and poorer support to children and families, for whom stability of support is key. The Care Review highlighted that the additional cost of employing agency staff is approximately £26,000 per worker per year, meaning a loss of over £100 million per year from children’s social care services.

Actions needed to support councils

To support councils to provide better support for children and young people the Government should:

• Introduce long-term reform to the SEND system, as set out in the LGA/CCN-commissioned research, which improves outcomes for all children with special needs and is also financially sustainable for councils.
• Write-off all Dedicated Schools Grant deficits to relieve the associated financial pressures that councils are currently facing. Ahead of this, Government should provide councils with certainty on the future of the statutory override for these deficits.
• Provide funding to address the substantial and growing cost pressures of home to school transport, particularly for children with SEND, or work with councils to identify ways to manage demand for, and access to, this service. These immediate measures should be accompanied by longer-term reform of home to school transport.
• Provide additional funding to meet the year-on-year increase in demand for Education, Health and Care Plans.
• At the 2024 Budget, provide certainty over children’s and young people’s funding streams due to end in March 2025 to protect services ahead of the Spending Review.
• End short term and disjointed funding streams which mean councils are unable to plan for the long term and have to direct funding to programmes which do not always align with local need.
• Meet existing cost pressures in children’s social care while also funding additional funding to improve early help services to reduce demand over time.
• Fully fund placements for unaccompanied asylum-seeking children and care leavers.
• Fund the roll-out of well-evidenced interventions to reduce demand for children’s social care placements and retain and expand placement capacity.
• Review the funding paid for early years entitlements to ensure it is properly reflective of the cost of delivery and results in high quality staff.
• Ensure no further real terms cuts are seen to the youth justice grant.
• Provide £500,000 to fund an extension to the Return to Social Work programme to bring 200 social workers back to the profession.
• Introduce government-funded training programmes and bursaries to encourage retraining from other professions.
• Provide funding for children’s social care services to expand administrative support for children’s social workers as well as supervision capacity and training.

Adult social care is fundamentally about people’s rights and relationships. At its best, it helps ensure that everyone can pursue the things that matter most to them, irrespective of their age or conditions. In recent years, many organisations from many parts of the care sector – including people who have cause to draw on care and support – have coalesced around a vision for care and support developed by Social Care Future:

We all want to live in the place we call home with the people and things we love, in communities where we look out for one another, doing the things that matter to us.”

Achieving this vision matters in its own right. But it is also a key enabler of delivering on the Government’s mission to build an NHS that is fit for the future. Whether it’s councils’ innovative work on hospital discharge to free up acute capacity, the vital work councils do to support people to remain fit and well and away from hospitals in the first place, or the work councils do with partners to recruit, retain and develop the care workforce, local government is central to realising a sustainable NHS.

Cost and demand pressures

Demographic pressures

The number of people aged 85+ (the age group most likely to need social care) is rising faster than the population overall. For instance, Census data shows that while England’s population grew by 7 per cent between 2011-2021, the number of people aged 85+ grew by 16 per cent.

In the here and now, the Association of Directors of Adult Social Services (ADASS) report that £914 million of additional funding is needed in 2024/25 to meet the same level of need as the previous financial year. This is 4.5 per cent of net budgets and is up from £692 million in 2023/24. Directors estimate that just over £800 million of the demographic pressure will be funded with the cost of the remainder having to be met through cuts to other services or use of other funding.

It is not just increased demand but increased complexity of demand which exerts pressure on the system given more complex needs typically cost more to meet. In the ADASS survey, directors were asked to rank the biggest drivers of financial pressures; ‘increased costs due to increased complexity of needs’ was the highest ranked source of pressure.

The level of pressure councils are facing means that waiting lists remain stubbornly high. As of 31 March 2024, 418,029 people were waiting for an assessment, the commencement of their care package or direct payment, or a review of their care plan. This is a reduction from 470,576 in August 2023, but remains a huge number, each representing a person whose care and support needs might not be being fully met. 78,641 people have been waiting for an assessment of their care needs for six months or longer.

Like many others, ADASS point out that unmet or under-met needs that flow from waiting times in adult social care may lead to greater reliance on unpaid carers. 88 per cent of adult services directors either agree or strongly agree that unpaid carers have come forward with increased levels of need in the last year. This finding should be seen in the context of 34 per cent of directors either agreeing or strongly agreeing that the ability of their council to fully meet the needs of unpaid carers has reduced.

Increased cost of provision

We estimate that the 9.8 per cent increase in the National Living Wage to £11.44/hour (April 2024) from £10.42/hour (April 2023) will alone add £1.6 billion to the cost of commissioned care in the current financial year. To put that in context, if all councils with adult social care responsibilities set a 2 per cent precept through council tax this financial year, that would raise an additional £600 million (excluding taxbase growth).

General high inflation has hit the care provider market hard. In December 2023, the Homecare Association announced its annual ‘minimum price for homecare (England)’, setting it at £28.53/hour effective from April 2024. This rate is what providers say is needed to ensure the minimum legally compliant pay rate for care workers (excluding enhancements for working unsocial hours), travel time, mileage, and wage-related on-costs. The rate also includes the minimum contribution towards the cost of running a care provider business which complies with quality and legal requirements. The Homecare Association estimated in November 2023 that hourly fee rates for council-commissioned homecare were £21.59/hour.

Workforce pressures

In its recent report on a long-term strategy for the care workforce, Skills for Care suggest an additional 540,000 adult social care posts will be needed by 2040 – equivalent to about 36,000 new posts every year from 2025. This estimate does not factor in the high turnover rate, which stood at 28.3 per cent across the sector in 2022/23. Nor does the estimate consider the vacancy rate – 8.3 per cent in 2023/24 – which makes filling these positions even harder. For comparative purposes, the vacancy rate across the UK for the wider economy stands at 2.8 per cent.

Increasing care worker pay is seen by many organisations, inquiries and committees as one of the most important steps to tackle the recruitment and retention challenges facing the care workforce. Care work is not one that significantly rewards experience. In 2016, care workers with five or more years of experience could expect an hourly rate that was 33p/hour higher on average than those with less than a year’s experience. Since 2016, that pay gap has shrunk to just 6p/hour. And although care worker pay has increased in adult social care, it remains one of the lowest paid sectors of the economy in general. Eighty per cent of jobs in the economy pay more than care worker median pay.

The Government’s commitment to codifying a Fair Pay Agreement (FPA) in adult social care represents an important opportunity to properly address the issue of care worker pay, terms and conditions. Local government will be central to the success of an FPA and should be engaged early and regularly throughout the process. Any resultant increases in care worker pay must be funded in full by Government.

The offer from councils

The new administration’s approach of mission-driven government is founded on the principle of “focusing on ambitious, measurable, long-term objectives that provide a driving sense of purpose for the country”. Investing in adult social care should be seen as a prime example of the potential for mission-driven government because it is an investment in all of us; those of us who draw on care and support or know a loved one who does, those who might need to do so in the future, or those who make up the workforce.

Adult social care should be seen as essential to the mission of building an NHS that is fit for the future. At its best, adult social care saves the NHS money, time and capacity, whether that is by reducing the number of people presenting to hospital in the first place or by helping to ensure the effective flow of people out of hospitals’ back doors and back into the communities they know and love. For instance, council occupational therapy (OT) teams, located largely in adult social care departments, do invaluable work to enable people’s participation in everyday life as well as more targeted work with populations experiencing significant inequalities. With the right support, OTs’ contribution could reach more people and help bolster the shift toward more preventative activity. The NHS-focussed mission rightly emphasises the importance of integration and refers to trialling Neighbourhood Health Centres. Adult social care – and other wellbeing-focussed council services such as public health – could play a key role in this initiative.

Adult social care has a range of other benefits to our national infrastructure. It has a Gross Value Added of £51.5 billion of economic activity in England alone (when including indirect and induced effects). This surpasses other big sectors such as electricity and power. It employs around 1.8 million people in England, making it a larger employer than the NHS. For every £1 invested, £1.75 is generated in the wider economy.

An investment in social care is an investment in the labour market and support to business. Economic inactivity is particularly driven by 50-64 year olds, many of whom are leaving the labour market because of long-term sickness or disability and/or caring responsibilities. A large number of people, particularly women, face challenges in employment due to unpaid caring responsibilities.

Adult social care investment should also be seen in terms of its value for money contribution. Promoting and supporting the care workforce reduces reliance on benefits and the strain on the welfare system. As a low emissions sector, adult social care is also a secure and sustainable investment.

The message is simple. Investment in adult social care matters in its own right. But it also matters if the Government is to achieve its missions. The NHS-focussed mission is the obvious link, but such is adult social care’s reach, influence and potential, it has scope to play into the Government’s other missions.

Productivity and prevention

Delivering savings

The most recent ADASS spring survey shows that directors are reporting planned savings of £903 million in 2024/25, equivalent to 4.4 per cent of net adult social care budgets. This is up from £865 million in 2023/24 and constitutes the highest level of planned savings since 2016/17 (£941 million). Only 15 per cent of directors are ‘fully confident’ of delivering their planned savings in full and 6 per cent have no confidence at all in delivering them.

There is limited scope for further cuts/savings in adult social care, particularly when set against the consequences of historic under-funding which includes, but is not limited to: more than 400,000 people on waiting lists for care needs assessments, a care plan review, or the commencement of a care package; providers ceasing trading or handing back council contracts; growing strain on unpaid carers; and reductions in investment in prevention. The ADASS survey already shows that, for 2024/25, 37 per cent of directors have indicated they will be using one-off funding (from, for instance, reserves) to fund their base budgets. This is up from 29 per cent in 2023/24 and 15 per cent in 2022/23.

The LGA, through Partners in Care and Health, continues to deliver a range of improvement support to councils to help them be as efficient and as productive as possible. This work spans housing and accommodation, digital and technology, new models of care, and commissioning. It also includes a comprehensive and highly regarded ‘Use of resources’ tool which, through a series of thirteen steps, uses a set of questions to promote informed self-assessment and improvement, taking into account local conditions and bringing in challenge at each step. It helps councils to identify areas for further exploration, where spend and/or activity is significantly different from regional or national averages.

Prevention

In a recent LGA survey of Lead/Cabinet Members for adult social care, 100 per cent agreed that the current system of health and social care places too much emphasis on treating sickness and not enough on preventing or reducing people’s needs.

The LGA and Partners in Care and Health are involved in several projects looking at the case for prevention. This reflects interest from across adult social care in investing more in early action and support. However, this desire comes up against the extremely challenging financial environment care and support operates in as set out above. That partly explains why the proportion of adult social care net budgets being invested in prevention has reduced from 8.2 per cent in 2023/24 to 7 per cent in 2024/25. It is the lowest proportion over the last eight years and it sits alongside a reduction in the number of directors indicating that their council is investing positively in the voluntary, community, faith and social enterprise sector (29 per cent in 2023/24 to 15 per cent in 2024/25). The LGA will be happy to share the findings of its prevention work with DHSC Ministers and officials.

Actions needed to support councils

The Government should provide an immediate injection of funding to continue tackling the issues facing the care and support sector. This would be a downpayment on a future multi-year settlement for adult social care and would help improve current challenges, including: waiting times for assessments, commencement of care packages, and care plan reviews; unmet and under-met need; provider instability; workforce recruitment and retention pressures; and growing and unsustainable strain on unpaid carers. Such funding would also be a much-needed boost to the voluntary and community sector, bolstering local community capacity.

The exact funding requirement for adult social care in the longer-term should be identified through a collaborative process, but we broadly support the Health Foundation’s analysis of the uplifts that would be required under the following different scenarios:

• Meet future demand: £0.6 billion by 2024/25 and £8.3 billion by 2032/33 (a 3.4 per cent a year real-terms increase).
• Meet future demand and make some improvements to access to care: £3.1 billion by 2024/25 and £11.6 billion by 2032/33 (a 4.3 per cent a year real-terms increase).
• Meet future demand and cover the full cost of care: £5.4 billion by 2024/25 and £14.6 billion by 2032/33 (a 5.1 per cent a year real-terms increase).
• Meet future demand and improve access to care and cover the full cost of care: £8.4 billion by 2024/25 and £18.4 billion by 2032/33 (a 6 per cent a year real-terms increase).

All options for raising revenue and the approach to allocations should be on the table, including:

• All disparate funding streams for adult social care to be brought together into a single pot, allocated directly to councils and with no (or only limited) conditions, and put into the funding base to provide certainty and the ability to plan for the long-term.
• Funding to be more much more outcomes-focussed, linking back to the duties, intent and ambition of the Care Act.
• End the reliance on council tax and the social care precept as a key means for funding adult social care and instead look to national taxation. Formalise national funding for adult social care but with delivery remaining local and frame this positively (for instance fulfilling the ambitions of the legislation) rather than negatively (for instance ‘bailing out councils’).
• Explore the potential for better alignment between adult social care and the benefits system, including for instance Attendance Allowance.
• Commit to a review of NHS Continuing Healthcare.
• Consider a different funding model for younger adults and older people to reflect the different life situations faced by people aged 18-64 and those aged 65 and over.

A Green Energy Mission has the potential to tackle climate change, an urgent and mounting threat to human wellbeing and the health of the planet. Local government’s offer in support of the mission is enormous. We hold influence to drive down a third of every place’s carbon emissions. As community and place leaders, housing, planning, transport, environment, and health authorities, and as procurers, asset holders, land managers, conveners, and enablers, we are central to reducing emissions and building resilience.

Locally-led models drive down costs and drive up co-benefits. Local climate action can achieve net zero for half the cost of a national approach and deliver three times the growth, jobs, skills and health benefits. Local approaches can also best build place-based resilience, climate change is forecast to cost at least 3.3 per cent of GDP up to 2050, over 15 per cent of GDP in some council areas.

Local government is united in the call for clarity, certainty, and a long-term delivery plan. There is cross party consensus on the need to back local climate action; all expert interventions call for further and faster local climate action. However, there has been an ongoing lack of clarity of the local role or a national delivery plan. Councils receive no core funding and instead are forced into competitions from a labyrinth of small, siloed pots. In the context of wider funding pressures, a continuation of the status quo risks threatening the future of local climate action at a time that it is most needed.

Climate action presents enormous opportunities for the long-term rewiring of public services in ways that best deliver the transition to a sustainable future. Local government is at the centre of this, we have three overarching propositions:

• Revitalise the partnership with councils.
• Empower councils to help deliver the schemes and objectives of the Green Energy Mission.
• Support councils to deliver cross-cutting initiatives that underpin the Green Mission.

Revitalising central local partnership working

Government should put in place arrangements to revitalise partnership with local government through a Local Green Energy Mission Delivery Programme with responsibility to move forward local government’s contribution within the wider Green Energy Mission governance. As a first step Government should establish a senior Chief Executive and Leader Sounding Board.

The objective should be on building a single national framework that rapidly provides clarity on roles, responsibilities, resources, and powers between local and national government across all Departments. It should set out a programme led approach for achieving net zero in all areas by 2050 as part of wider plan of sustainable long-term funding for local government action on the environment.

Empowering councils to deliver Green Energy Mission objectives

Warm Homes

Commitments to double planned investment to upgrade 5 million homes are positive, as is the recognition of local government’s role in delivery.  Reducing emissions from homes and buildings is critical but not straightforward. As place leaders, landlords, housing, and planning authorities, local government can play a lead local role in the decarbonisation of housing street by street.

Through a renewed national local relationship, local government:

• Wants to help design and deliver the Warm Homes Plan, leading place-based efforts to reduce emissions from social and private rented homes and exercising their leverage to help owner occupiers.
• Would like the new approach to radically reform the existing national retrofit schemes, including the Social Housing Decarbonisation Fund, Home Upgrade Scheme, and Energy Company Obligation. By pooling funds, a new approach could bring the scale needed to shift towards a place-based allocations model of funding retrofit outcomes to build certainty and long-term plans for local government and supply chains, and away from the challenges of dealing with fragmented competition pots. We also need flexibility across retrofit effort to include adaptions building resilience to the impacts of climate change, in particular overheating and flooding.
• Needs flexibility to shape and deliver interventions via an outcomes framework. This will allow them to connect it with other interventions on carbon reduction, fuel poverty and public health.
• Wants to explore options to exercise existing duties to support the private rented sector to meet minimum energy efficiency standards, which have been so far difficult to exercise due to resource pressures.
• Would like to see a similar approach into non-domestic buildings, in decarbonising the public sector estate. Reviewing the Public Sector decarbonisation Fund and the relationship with GB Energy towards a ‘one public estate retrofit’ programme.

Future Homes

The commitment to increase housing delivery rapidly is welcome. For the benefit of community support and our energy objectives all new homes must be net zero. The simplest and cheapest way to reduce emissions from homes is to design them out in the beginning. Through a renewed national local relationship, local government:

• Would like to see the proposed Future Homes and Building Standard made more ambitious with mandatory requirements for roof top solar PV and battery storage. The standard could do more to reduce embodied carbon in building materials and promote resilience to climate change, such as efficient cooling.

GB Energy and Local Power

As place-shapers, enablers, planners, asset holders, conveners and community leaders, local government can play a leading role in helping deliver the clean energy mission by 2030.

Through a renewed national local relationship, local government should be enabled to:

• Work in partnership with community energy companies to deliver small and medium-sized renewable energy projects.
• Bring forward small and larger projects on their own, perhaps using their own land and assets or with powers to engage other public sector bodies on using their assets.
• Provide strategic local energy planning advice working with communities and energy system partners to identify sites for renewable power projects, grid constraints and opportunities.
• Bring about energy system reforms alongside other spatial plans, balancing land-use pressures for growth plans, new housing, nature recovery, infrastructure, transport etc. underpinned by work with communities to build trust and support, including community benefit models.
• Continue playing a lead role in expanding the delivery of heat networks through the heat network transformation programme, and associated policies such as zoning, and align these within the wider GB Energy and Local Power plan.

Roadmap to a zero-waste economy

The resource and waste reforms could have a profound impact on reducing waste and related carbon emissions. We are keen to ensure the reforms reduce waste in the first place through the polluter pays model, and have concerns the proposals do not currently achieve this, instead adding significant funding risk to local authorities. This is summarised in our Waste Reforms Briefing.

A particular issue is that current proposals to extend the Emissions Trading Scheme (ETS) to waste from 2028 proposals risk putting enormous costs on councils. Based on available data, the LGA projects that the expansion of ETS to local authorities in 2028 could add gross additional costs of between £367 million and £747 million and could rise to £1.1 billion in 2036 with a total cumulative cost over this period that could be as high as £6.5 billion. These figures do not include possible mitigations via the packaging Extended Producer Responsibility, which we estimate would cover 18 per cent of costs.

(Source: Understanding funding Implications of the extension of Emissions Trading Scheme to Waste; Solaire Consulting and Ridge Environmental for LGA, County Council Network and District Council Network, 2024).

To help councils address these issues Government should take the following actions:

• Rather than placing ETS costs on councils, they should be recovered directly from producers for different material categories via the simplest routes possible. This would best incentivise the reduction in fossil-based material and generate the revenue to invest in long-term solutions, such as carbon capture and storage.
• Current proposals to introduce the packaging Extended Producer Responsibility scheme should re-commit to full net cost recovery for local government’s packaging waste services. This must mean moving from the current ‘modelled’ costs to ‘actual’ costs as soon as is possible. Our modelling has highlighted some risks in the current modelled approach, concerns about underfunding of local government.
• Current proposals for a Simpler Recycling policy to reverse plans to limit local authority flexibility on the frequency of household residual waste collections, as evidence shows less frequent residual waste collections can increase recycling and reduce costs. Also, Simpler Recycling reforms should rapidly provide certainty on food waste new burdens funding and review funding levels in 2027 to meet shortfalls, align household and non-household simpler recycling reform commencement dates.
• A review of recent waste disposal decisions, including to fully fund local authorities with the disposal infrastructure for Waste Upholstered Domestic Seating with Persistent Organic Pollutants, and to remove recently introduced restrictions preventing local authorities for charging for ‘DIY’ waste.
• A discussion on the scope and opportunities for bolder regulatory action to reduce waste and related emissions created in the first place. Such as regulating the use of materials in products either to limit or require use of different materials.

Nature recovery

Local government can play a critical role in spearheading the protection and growth of our natural assets. While local authorities are often the first port of call for communities on the natural environment, is not often clear in amongst other national and regional agencies.

Through a renewed national local relationship, local government can:

• Put in place Local Nature Recovery Strategies as the building blocks at the centre of the national effort for nature recovery. LNRSs are currently being developed with communities, landowners, farmers, and other partners, and should hold the levers over all policy and funding schemes (such as tree planting, and ELMS) that turn community will around spatial strategies into deliverable projects attracting private finance.
• Ensure that the new mandatory Biodiversity Net Gain (BNG) is a success and does not hold up housebuilding by providing more support and flexibility for councils to help stimulate the off-site BNG market, and devolve national “credits” to support local action on nature recovery.
• Lead local efforts to deliver nutrient neutrality mitigation actions to enable housebuilding, supported by further flexibility in funding and with more robust government action to reduce pollution at source.
• Link local nature recovery efforts into wider local spatial plans for housing, growth, energy infrastructure and transport, and gaining community buy in for action across the different agendas; potentially through land-use principles.

Clean transport

Local government should be empowered to bring about a whole-place transport decarbonisation strategy. Through a renewed national local relationship, local government:

• Should be empowered through policy and funding certainty to bring about a whole-place transport decarbonisation strategy by devolving to places the means to locally mix active travel, electric vehicles, and public transport schemes.
• Should be supported where they would want to implement demand management schemes such as workplace parking levy, congestion, and clean air zones.
• Can develop local transport decarbonisation programmes as part of wider strategies for decarbonising energy, improving air quality, and connecting with new housing and development in ways to support economic growth.

Cross-cutting actions underpinning the Green Energy Mission

Local government has a critical role to play in delivering on the green energy mission objectives. Through a renewed national local relationship, local government would like to work with government to provide long-term financial certainty through multi-year funding settlements linked to outcomes agreements, which includes an appropriate level of revenue funding. We have set out proposals for this to be achieve via Local Climate Action Plans covering all areas, each being unique but following a single framework, reviewed, adapted, and refunded at every Spending Review period up to 2050.

There are cross-cutting factors that underpin success across all objectives, around which there is need for national local government collaboration. These include:

• Moving towards a smarter, simpler, more coherent, and sector-led support offer that builds on the LGA’s existing programme of improvement work and helps local government build resources and capacity to realise its potential in delivering the green energy mission, alongside greater clarity of its role and powers. The current support landscape is fragmented and can lack the depth to make a significant difference.
• Delivering a step change in community engagement to get public buy-in across the green energy mission, to help realise public and co-benefits, support the ‘able to pay’ market to invest themselves, and to help achieve a just transition.
• Options for providing scale through partnership, empowering local authorities to come together and with other public sector agencies to pool skills, experience, and projects into programmes, with a focus on attracting private sector investment.
• Linking the green energy mission with devolution, growth plans, workforce, skills and supply chain agendas, while moving towards a governance model that supports all local authorities everywhere to make progress, by building on their current strengths.
• As far as possible align clean energy action with efforts to build climate resilience that prepares people and places to extreme heat, drought, storms, and other threats. This could include a further review of the National Adaptation Programme to accelerate action on this agenda.

We support the Government’s mission to kickstart economic growth and their intentions to deepen and widen devolution across the whole country. The main drivers of economic prosperity are intrinsically local with councils sitting at their heart: housing is critical to accommodate residents of growing towns and cities; efficient transport networks and comprehensive digital connectivity enables economic activity, attracting new and supporting existing employers and sectors; and investment in the health and skills of local people will lead to increased productivity; promoting local culture and the visitor economy enhances the local identity and attractiveness of places to investors. These drivers of growth are not exhaustive but outline some of the key opportunities that will require action across the piece to deliver inclusive growth. Only local government, with its unique knowledge and connections with the people and places they serve, can deliver investment in the right places at the right time.

What local growth and prosperity looks like will vary from place to place. Whilst all places will share some common priorities, the nature of challenges and opportunities to delivering economic growth are unique to each place. Councils need to be able to flex the funding support they receive from central government to reflect local priorities and opportunities for growth over the long-term. Critically, longer-term funding provides certainty and confidence to private investors of local and central government’s commitment to the area.

Devolution

The Government’s commitment towards 100 per cent devolution in England is positive and answers the LGA's long held ambition that every area of England can secure a devolution deal that works for them, their local economies, and their residents by the end of the decade. Further, we welcome the Government formalising plans for further devolution and providing clarity on the role of local government and its responsibilities for driving growth and prosperity in law via the English Devolution Bill.

We would like to work with government on the development of the commitments in the English Devolution Bill to:

• Establish a new enhanced framework for wider devolution across England which is underpinned by local government's pre-eminent place-shaping role and is combined with sufficient funding so that all councils, including in combined authority areas, can deliver local growth priorities, unlocking the full potential of economic development teams which have been diminished by budget cuts. All councils’ economic development teams are critical to the places they serve, but together are vital for England plc too. With the right resource and powers, they can generate jobs, increase skills, improve productivity, and address social, regional, and economic inequalities within and between places. However, continued pressure on local government budgets falls disproportionately on non-statutory services including economic development. Failure to address this could undermine the ambitions of local leaders across all parts of the country to achieve inclusive growth.
• Ensure that Departments use analysis of new policy initiatives to consider the benefits of local government acquiring new policy powers and/or fiscal power to take control of growth policy. It would embed a culture of ‘thinking local’ in the UK’s centralised decision-making structures.
• Explore the potential for local fiscal freedoms as part of a commitment to further devolution. We are aware the fiscal environment is constrained and will continue to be so for some time, and there are not immediate sources of additional local funding.
• Shape the statutory requirement for local growth plans to ensure they are as least resource intensive as possible and that local areas are sufficiently resourced and have capacity to deliver this new burden.

Further and deeper devolution to mayoral combined authorities is positive overall, providing local leaders greater freedom to take decisions closest to the people they represent. However, the LGA has argued that devolution needs to signal a genuine 'local first' approach to policy making across government departments. Those areas that are unlikely to support a mayoral combined authority should not be subject to the burdensome negotiations and top-down impositions of new structures, or being consigned to the devolution 'slow lane'.

Funding to support Local Growth Plans

In the quest to kickstart local growth, the nature of funding and where spending decisions are made is as important as the quantum of funding. To give new Local Growth Plans, and the Government the best chance of success across all its missions, this spending review must signal a refresh in the funding landscape for investment in local growth and social infrastructure.

This new approach from Government should include:

• A simplified, consolidated approach to growth funding, allowing local leaders the flexibility over where and how investment decisions are made locally – be it in our high street, connectivity and mobility infrastructure or investment in the skills and productivity of local people and businesses. Competitive bidding pots should be consigned to history.
• Current funding levels being treated as a baseline. The previous Government’s growth-related spending commitments should be regarded as a floor for future funding.
• Funding agreements that are long-term, over a 6 to 8 years basis. Delivering the Government’s missions, including inclusive growth and removing the barriers to opportunity, will take many years to address. Policy and funding commitments need to match this timescale and allow for movements between years. This will allow a greater focus on preventative measures.
• Recognition of the importance of revenue funding. Inadequate revenue funding undermines the potential of transformative capital-intensive projects.
• Timely funding. A co-design approach to designing of funding pots from the outset, so that time is maximised on actual planning and delivery and levering in private investment, and not on administration of the fund.
• Flexibility to respond to the continuing transformation of local government, such as devolution approaches, and increasing use of shared services and resources. Government policy should evolve to receive submissions from larger areas that are subject to collaborative agreements. The use of match funding should be further incentivised and encouraged where appropriate.

There is a particular issue in relation to the UK Shared Prosperity Fund (UKSPF) which is due to end in March 2025. This fast-approaching deadline without funding certainty is starting to impact on the delivery of provision and in many areas has meant a reduction in incentives for businesses to invest.

Councils are also awaiting clarification on other growth funds, including the third round of the Levelling Up Fund so they can allocate resources accordingly. In this context the Government should:

• Consider bridging arrangements while it redesigns its approach to growth funding. Our preferred solution is that the Government provides one-year additional funding that is equal to year 3 of UKSPF.
• If this is not possible, any new growth funding stream should allow the flexibility for current lead authorities to identify projects at risk and use funding to continue provision for 12 months.
• Provide a decision on the third round of the Levelling Up Fund urgently.

Economic development services provide a proven delivery mechanism for place-based funding, along with local capacity to create, identify, and appraise candidate projects. In recent years there has been a deliberate shift of government policy to put councils front and centre in delivering local economic outcomes.

However, continued pressure on local government budgets affects non-statutory services like economic development the most. Some economic development services consist of just one officer based in a larger team. Added to this, shorter-term, competitive, national bidding rounds adds pressure on economic development services to commit scarce resources into writing competitive bids.

Mobility (Transport)

Good transport networks will play a critical role in delivering the Government’s missions, providing access to employment opportunities, healthcare and education, as well as unlocking economic opportunities in tourism and leisure. Councils are crucial to maintaining and improving these networks. 

However, our highways are facing a £16.3 billion backlog of road repairs and in recent years budgets have been ravaged by inflation, including an 84 per cent rise in the cost of bitumen since 2020. Maintenance plans have also suffered from reductions in both capital and revenue funding. Planning for preventative measures has been hampered by short-term funding from central government, resulting in too much expenditure of more expensive pothole repairs. The disparity in cost between filling potholes as part of a planned programme of carriageway repairs compared with that as a reactive repair is significant – whilst some reactive repairs are inevitable, councils could save up to 35 per cent of their budgets if they could fix potholes as part of a planned programme.

Local bus services have been in decline for several years, and in the two years following the launch of the national bus strategy in March 2021 23 per cent of bus services in England have been cut, resulting in 2,800 fewer services. Demand for bus services has not yet reached pre-Covid levels with bus boarding outside of London being at only 82 per cent of pre-Covid levels. This has impacted on commercial viability of services. Provision has also been impacted by inflationary pressures and driver shortages. This has made tendering costs much more expensive for councils.

To support councils in addressing these issues the Government should:

• Commit to the same spending plans of the previous Government, as set out in Network North. For highways maintenance, that is an additional £8.3 billion spread between 2023/24 to 2033/34 on top of existing levels of funding – which in 2023/24 was £1.125 billion plus £260 million from the Integrated Transport Block. If this commitment is delivered, this should result in an average of £2.14 billion a year of Government contribution to local highways maintenance – an annual increase of 54 per cent.
• Recognise that the £16.3 billion backlog of road repairs cannot be fixed over a single Parliament. It requires a long-term funding package, creating the incentives for greater cost-saving innovations and a focus on longer term preventative resurfacing programmes.
• Ensure that transport infrastructure funding is consolidated, long-term and flexible, providing certainty to assist longer-term planning, and the ability to flex to meet longer-term priorities. 
• Commit to existing levels of funding for buses as a minimum, including through Bus Service Improvement Plan (BSIP) funding, BSIP plus, Bus Service Operators Grant (BSOG), concessionary fares support and the national £2 fares cap.
• Reform and simplify government funding and subsidies on buses and devolve to local authorities as a long-term package of support so that transport authorities can shape bus services and ensure public funds can be better targeted to meet local priorities and help get passenger numbers back to pre-Covid levels and beyond.

Employment and skills

Training and skills

It is positive that the Government is proposing measures to reform the centralised and fragmented approach to employment and skills. For too long it has struggled to flex around the needs of places and adequately deal with rising numbers of people out of work, or anticipate the skills needs of employers and sectors from net zero to the foundational economy. This is why councils and devolved authorities step in to make the system work as best it can for people and places. There is a better way.

Work Local advocates for devolved and integrated employment and skills services. A cost benefit analysis revealed it has the potential to increase by15 per cent the number of people moving into work and improving their skills. This is good for people and places, reduces costs to the public purse and contributes to growth. Our new Work Local employment and skills offer recommends practical steps the Government can take working with us to improve services across England via three interlinked offers:  

• Youth Pathways – to help young people (age 16-24) not in employment, education or training (NEET), or at risk of being so, find their first job or put them on a career path.
• Working Futures – for adults who are disadvantaged in the labour market, and who need personal support to find work or better work.
• Skills for All – to provide a better match of skills supply and demand and promote lifelong learning, this is a skills and learning offer linked to local careers advice and jobs.

The foundations for these already exist in local government. Initially, the three offers would use existing programmes and devolution deals and be locally planned and commissioned through outcome-focused ‘local employment and skills agreements’ (LESAs), to run for at least three years. Existing devolved authorities and their constituent councils can deliver more and at a quicker pace. For other parts of England, we need a more ambitious and coherent devolution deal process. This involves working with a wide range of partners including employers and ensuring there is a well-connected set of local providers and institutions.

Local and national leadership is needed to realise these plans. Measures to kick-start the process include: 

• A ministerial-led joint national board and a joint unit of Whitehall and local government officials to coordinate planning.
• A new ‘duty to co-operate’ on all partners.
• An improved ‘Universal Support’ delivered through local government, and joint work and co-location of jobcentre plus and councils.
• An early call for new initiatives or pilots.

Our proposals speak directly to the growth and opportunity missions, and read across well with manifesto commitments including Work, Health and Skills, Youth Guarantee, National Jobs and Careers Service, Skills England and a reformed Growth and Skills Levy. We want to work with the Government to shape these, connect them up, and embed the role of councils and devolved authorities so together we can improve public services for residents and employers everywhere.

Economic inactivity

Addressing economic inactivity is a priority for the new Government as set out in its Back to Work Plans. The previous administration announced Universal Support (US), a £1.4 billion supported employment programme to help more people back to work which was scheduled to run from Autumn 2024 to 2029. Since the DWP signalled it would be grant funded to mayoral teams and ‘clusters’ of councils in areas without devolution, we - councils, mayoral teams and the LGA - worked closely with DWP to inform the design of it. The General Election delayed the phasing in of US.

For councils to deliver this programme effectively they need:

• Joint work between DWP and councils to agree numbers of people to be supported per area and the overall funding envelope.
• A clear timetable for phasing in across England and Wales.
• Implementation funding to stand up the service alongside funding for front line delivery.
• Maximum flexibility over which residents they prioritise and the type of supported employment they choose to deliver.
• Ability to use funding across years rather than annual allocations. 
• A change to the name of the programme so it does not get conflated with Universal Credit.

Digital Connectivity

There has been important progress in closing the digital divide in the coverage of superfast and ‘decent’ fixed broadband. However, a new digital divide has emerged in gigabit and full fibre coverage with the top 10 per cent of district/unitary local authority areas enjoy full fibre coverage of over 60 per cent, while the bottom 10 per cent have less than 10 per cent of premises able to access these services. A substantial gap also remains between rural (47 per cent) and urban areas (79 per cent) in terms of gigabit coverage. Similarly, rural councils continue to lag more densely populated areas in the roll-out of 5G and wider improvements to digital connectivity. 17 per cent of rural residential premises and 30 per cent of rural commercial premises still do not have access to superfast broadband. 

The recent switchover from the Public Switched Telephone Network (PSTN) to full-fibre solutions is also expected to cause significant cost pressures for local authorities. For example, the Greater London Authority estimate that regarding social care users living at home, the switchover will cost £31 million for London Boroughs.

To address these issues we are calling for:

• Strengthened investment and innovation to ensure universal access to high-quality digital infrastructure.
• Government to provide a clearer assessment of the costs to councils, communities and businesses arising from the switchover from the PSTN to full-fibre solutions.

Local Government Centre for Digital Technology

We also propose the establishment of a Local Government Centre for Digital Technology (LGCDT) to empower local authorities to harness the full potential of digital technology. The LGCDT will drive innovation, efficiency, and improved services for communities across the UK. The Centre's mission would be to support the secure and inclusive use of digital technology by councils and communities.

The LGCDT would invest in training and development programs to upskill local government staff and build digital capacity. It would provide technical assistance, guidance, and resources. The Centre would also help local authorities streamline processes, reduce costs, and improve service delivery through the adoption of digital technologies. Developing and managing compliance against cyber security and data protection standards will ensure secure, resilient and trustworthy digital services. By leveraging collective buying power, the Centre would secure the best value for money and access innovative solutions.

The LGA is in the process of developing a full business case and proposal and intends to bid for investment from the Department for Science, Innovation and Technology (DSIT) later this year. The bid will likely cover the financial years 2025/26 to 2028/29 inclusive.

The Government has made having safer streets one of its five missions. Naturally, when people think of the agencies involved in making their streets safer, people tend to think of the police. However, other agencies play significant roles. Community Safety Partnerships (CSPs) were introduced by Section 6 of the Crime and Disorder Act 1998 (and 2007 regulations) and bring together local partners to formulate and implement strategies to tackle crime, disorder and antisocial behaviour in their communities.

The responsible authorities that make up a CSP are the police, fire and rescue authorities, local authorities, health partners and Probation Service. CSPs work on the principle that no single agency can address all drivers of crime and antisocial behaviour, and that effective partnership working is vital to ensuring safer communities. There are over 300 CSPs in England and Wales, operating as either district, unitary, or borough partnerships. Many CSPs are council led and primarily council funded. 

Funding for CSPs has reduced dramatically since their creation. This has been compounded by the introduction and funding of Police and Crime Commissioners (PCCs). Some duties see the statutory responsibility sit with CSPs and yet funding is awarded to the PCC. The LGA and Association of Police and Crime Commissioners (APCC) are working together to suggest to Government a new partnership of these entities that could lead to a rationalisation of the partners, duties and processes used to make communities safer. The current burden on CSPs currently falls disproportionately on councils and the Government cannot deliver on this mission without their local delivery partners having capacity to deliver.

This mission also receives renewed attention and focus following the violent disorder witnessed in England over the summer of 2024. The LGA is to take part in the MHCLG Recovery Steering Group and is working with councils to review immediate recovery costs and funding required to prevent a repeat of such activities.

Councils and Community Safety Partnerships (CSPs)

The total and social economic cost of crime in 2015/16 was calculated by the Home Office in 2018 as £50 billion for crimes against individuals and £9 billion for crime against businesses. Separate research by the Ministry of Justice suggests the cost of reoffending in 2019 was £18.1 billion, of which the cost of reoffending by children and young people was estimated at £1.5 billion. 

ONS analysis of data around young offenders shows 54 per cent of people imprisoned by the age of 24 first offended before the age of 16. Rates of imprisonment for children in need and children in care, as well children with SEND are markedly higher than for other students. Nine out of ten young people in custody have some form of special education need or emotional and behavioural need. Over 30 per cent of adult prisoners have a learning disability compared to 15-20 per cent in the general population. Research commissioned by the LGA suggests there is strong evidence for a link between experiencing family violence and subsequent participation in youth offending. 

Investment not only in councils’ community safety services but also in a range of other council services would have an impact on crime rates. For example, investment in children’s services, youth offending work, youth diversion activities as well as programmes to give children a better start in life would all have an impact on the number of offenders in custody initially in terms of young offenders but then longer term as the cohort of adult offenders reduces. Investment in councils’ community safety related services along with the local flexibility to set their own priorities could also deliver significant savings to the criminal justice system.

The Government should work with councils to help secure these benefits:

• Introducing long-term sustainable funding arrangements of three to five years for community-safety related funding, paid directly to councils or community safety partnerships rather than for example to police and crime commissioners, would permit better forward planning and achieve better value from contracts. So would combining funding into single streams rather than separate pots.
• Providing additional funding to increase community safety partnership capacity (such as additional analytical capacity, wardens, CCTV), with local discretion about how it is used to achieve the government’s mission to ‘take back our streets’ would help in the delivery of the government’s aims.
• Councils can help reform the duty and partnership landscape to ensure Community Safety Partnerships are equipped with the powers and partners to deliver. This would help government hold CSPs to account for existing duties, know where to place new duties and ensure CSP effort is spent on delivery as opposed to resolving governance issues. It is suggested this work is carried out between the LGA and the Association of Police and Crime Commissioners (APCC).
• Government investment in council services that help local government prevent crime would include:
  
  • services that address adverse childhood experiences and also improve mental health and wellbeing
  • youth and children’s services, particularly those that engage with children and young people on the fringe of the criminal justice system
  • SEND and speech and language provision
  • homelessness
  • public health measures that address the social determinants of health will also reduce vulnerabilities to and the risks of engaging in crime
  • substance misuse treatment
  • support to design out crime
  • perpetrator programmes.

Community cohesion and countering extremism

The LGA supports the Special Interest Group on Countering Extremism (SIGCE). Their work is vital in the recovery from the violent disorder witnessed across England in the summer of 2024. The group shares both intelligence and best practice on countering extremism and building resilient communities. The annual cost is £30,000 per annum.

The Government should work with councils to help local areas recover from the recent social disorder:

• As part of the recovery, continued funding from Government for SIGCE would be welcome. If funding could increase to £100,000, SIGCE would be able to carry out more intensive and targeted support to areas affected by recent violent disorder. This could include peer reviews targeted at cohesion functions and an upgraded online portal to replace the existing, limited, knowledge hub.
• Ensuring continuity of or increasing the current asylum funding for councils could also more effectively support local capacity to integrate asylum seekers, foster welcoming communities and reduce risks of anti-asylum activism.

Building new prison places and introducing tough new penalties

The Government has announced its intention to build 20,000 new prison places. This is a continuation of the previous Government’s commitment to expand prison capacity. By September 2023, it had delivered 6,000 new places with two new prisons opened. The remaining 14,000 will be delivered through one new open prison (under construction) and three new super prisons that are not expected to open before 2027. The programme was due to be completed by the mid-2020s but is now expected to be delivered by 2030.

Due to capacity issues the Government reduced the threshold to trigger early releases from 50 per cent to 40 per cent of tariff served. They also activated the previous government’s Operation Early Dawn in the North West and the North East due to immediate pressure on the prison estate. This programme sees those held on remand held at police stations.

Tranche 1 of the early release scheme takes place on 10 September 2024. Tranche 2 takes place on 22 October 2024. Councils have concerns about the pressure this will place on housing departments, homeless pathways, specialist support teams and reoffending.

Proven reoffending rates have fallen or remained static since 2008/09 until 2021/22 when they increased. Between 1 in 3 and 1 in 4 people released from custody are known to reoffend. It can, therefore, be argued if prison is to stop reoffending it does not work for between a quarter and a third of those incarcerated. In 2024 there were 97,800 people in prison in the UK. In 2022/23, the average cost of a prison place in England and Wales was £51,724 per annum. This cost is exclusive of the cost of police and the judicial system. This means approximately £1.36 billion is being spent annually on imprisoning people who will reoffend. The Government is committed to introducing tough new penalties for offenders. Due to prison capacity issues, prison not working for a large proportion of people, the cost associated with imprisonment and capacity on the judicial system, swift non-custodial options for some offences should be considered.

The Government should work with councils to help address reoffending:

• Councils own and/or manage many community assets. Councils could, as part of Community Safety Partnerships, maintain a pipeline of visible community action schemes that could be deployed for forms of community sentencing. This would allow a saving of £51,724 per annum per person as well as judicial cost. Councils would require new burden funding to carry out this activity and resources would be required for the probation service to manage such schemes. This would however have a positive impact on the visibility of justice as well as reducing the burden on the prisoner estate.

Reducing anti-social behaviour and serious violence

Estimates from the Crime Survey for England and Wales (CSEW) for the year ending September 2023 showed that 34 per cent of people had experienced or witnessed some type of anti-social behaviour (ASB), this was similar to the year ending September 2022 (35 per cent). The police recorded 1 million incidents of ASB in the year ending September 2023 (including the British Transport Police). This was an 8 per cent decrease compared with the year ending September 2022 (1.1 million incidents).

Many who experience ASB first report this to their landlord or housing provider. Councils also have powers to take action against certain types of ASB. However, many will report such activity to the police instead. The Government recognises councils, housing providers and other agencies such as the police need to work more closely together in sharing data and acting collectively. For this reason the CSP relationship with housing is being given attention. One of the most common problems for sharing information is data sharing agreements. 

The number of police recorded violence against the person offences in England and Wales has increased every year since 2012/13 until 2023/24. In 2012/13 this stood at 601,141 incidents and in 2023/24 this had reached 2,014,390, peaking in 2022/23 at 2,109,038. This represents an increase of 335 per cent. From 2004/05 the number of recorded offences reduced annually until 2012/13.

The Government should work with councils to help address anti-social behaviour and serious violence: 

• The LGA could commission legal advice on a model data sharing agreement for councils and CSPs. If this was commissioned by the LGA, this would be legal advice that could be leaned on by our member councils. This would reduce the number of localities designing and agreeing data sharing agreements for different pieces of information for different types of crime related data. This model data sharing agreement could be accompanied with some guidance on how best to record, store and share data sets. This would be essential for accountability and to track Government progress. The cost of legal advice would be circa £20,000 and the cost of accompanying advice circa £10,000.
• Anti-social behaviour can be related to sale and distribution of alcohol. Licensing fees have not been updated since 2005. By enabling councils to set licensing fees under the Licensing Act 2003, councils would be able to set fees that take account of the local conditions and environment they know best. Locally set fees would help councils face shortfalls in administering their statutory obligations under the Licensing Act.

Rape units and halving violence against women

While men and boys also suffer from forms of abuse, harassment, stalking, rape, sexual assault, murder, honour-based abuse and coercive control disproportionately affect women. A woman is killed by a man every three days in the UK. Domestic abuse makes up 18 per cent of all recorded crime in England and Wales. In the year ending March 2022, there were 194,683 sexual offences, of which 70,330 were rape.

The Government has said it wants to have a specialist rape unit in every police force and has dedicated itself to halving violence against women and girls in a decade. To do so requires early intervention, education, and support as well as perpetrator programmes.

Councils currently have ‘part 4 duties’ under the Domestic Abuse Act to re-house victims and survivors of domestic abuse, but this is limited by the housing supply in some areas of the country. Many victims and survivors also rely on specialist council services that are non-statutory. Many of these services have been reduced or withdrawn as local government funding has reduced. Some suppliers have also left this market due to uncertainty brought about through annual funding settlements. 

Independent, specialist domestic abuse services are already under significant financial pressure. Mapping carried out by the Domestic Abuse Commissioner found that, in 2020/21, 27 per cent of specialist domestic abuse services were forced to scale back or cease some of their services due to a lack of funding. This rises to 43 percent for the more specialist, ‘by and for’ organisations who support the most marginalised communities. This has only continued to worsen, with research from Women’s Aid in November 2022 finding that over two-thirds of their member services would either need to turn survivors away from existing support, reduce support available, or close altogether as a result of funding constraints and the cost-of-living crisis.

The Government should work with councils to help reduce violence against women:

• Councils can often rehouse perpetrators more easily than victims and their families. This is especially the case where one-bedroom apartments are available. Councils should be given the powers to rehouse perpetrators under ‘part 4’ of the duties. 
• Councils can expand the number of possible providers for specialist services if longer term funding was awarded. Government needs to fund local authorities adequately for such services to continue.
• Continuing to fund successful existing programmes, in particular funding for implementing the Domestic Abuse Act and work to address serious violence and anti-social behaviour hotspots could have a significant impact. 
• Providing additional funding to assist with the costs of carrying out domestic homicide reviews would assist in the families and friends of victims receiving justice and the comfort in knowing lessons will be learned.

Reducing knife crime and creating a new network of Young Futures hubs

Knife-enabled crime recorded by the police in year ending March 2024 increased by 4 per cent to 50,510 offences compared with year ending March 2023 (48,409 offences). These figures do not include Greater Manchester who could not provide figures due to an IT issue. The number of homicide offences involving a knife or sharp instrument in England and Wales has remained above 2008/09 levels since 2016/17 with a peak on 2021/22 with 282 incidents. The year ending March 2024 saw 78 of these being aged under 25. Ten were under 16.

Young people need to be deterred from wanting to carry knives, rather than just looking at the deterrent offence or supply of knives. To do this requires confidence in the police, the ability to feel safe, mental health support, diversionary activities, education programmes and other sanctions.

The Government intends to introduce a targeted programme in every area to identify the young people most at risk of being drawn into violent crime and build a package of support that responds to the challenges they are facing. The former is already undertaken by Directors of Children’s Services. Both are being considered by Government as a new duty on CSPs. The aim is this work will bring together services at a local level to better coordinate delivery of preventative interventions around the young person, rooted in a strong evidence base. In addition, the Government wishes to develop a national network of Young Futures hubs to bring local services together, deliver support for teenagers at risk of being drawn into crime or facing mental health challenges and, where appropriate, deliver universal youth provision.

Through trading standards, councils play a vital role in the regulation of the sale of knives to young people. There is currently an ageing workforce in regulatory services and a shortfall of new recruits, leading to under-inspection and threatening the ability to deliver regulation in the future. Dedicated funding for apprenticeships and recruitment programmes related to the regulatory services workforce is needed to boost the future pipeline of officers entering local government. The cost of a degree-level (Level 6) chartered manager Apprenticeship Standard can cost up to circa £22,000 per annum. 

The Government should work with councils to help address youth offending: 

• Councils could boost their trading standards services and the ability for these departments to understand younger people and their behaviour through employing apprentices. This would also replenish the workforce, the cost of which would be up to circa £3.9 million per annum if every trading standards service was given a dedicated apprentice. This could be partially funded from allowing councils to charge on a ‘polluter pays’ principle when someone is in breach of licensing conditions. This is similar to how the Health and Safety Executive already operates. National Trading Standards is currently participating in a Home Office legislative review on knife sales to children. To be effective, the outcomes of this review require funding, both specifically and in terms of the overall workforce challenge facing regulatory services.
• To work constructively with the Government on the Young Futures programme will require new burdens funding. Youth Hubs should be considered for piloting in the areas most impacted by recent violent disorder.
• Undertaking a review of Youth Justice Board funding for Youth Offending Teams and the prioritisation of existing funding would allow a greater focus on prevention and diversion. It would also bring funding for remand placements in line with actual costs.

Priority 1: Sufficient and sustainable funding

To address the immediate financial pressures faced by councils Government should:

• Provide councils with a significant and sustained increase in overall funding that reflects current and future demands for services.
• Provide councils with multi-year and timely finance settlements.
• Provide general rather than ring-fenced grant funding, reduce the fragmentation of government funding and end the use of competitive bidding to allocate grant funding.
• Commit to the Fair Funding Review (FFR), reviewing both the formulae and the underlying data used for the assessment of relative needs and resources. Transitional mechanisms attached to the outcome of the FFR should provide sufficient funding to ensure that no council experiences a loss of income.
• Provide certainty over financial reforms including the business rates reset, the Fair Funding Review, and reforms to other grants such as the New Homes Bonus, and consulting on any potential changes in a timely manner.
• Give councils the power to vary all council tax discounts including the single person discount which is worth around £3 billion a year.
• Abolish council tax referendum limits so, in due course, alongside the completion of the FFR, councils and their communities can decide what increase in council tax is warranted to help protect or improve local services.  
• Enable councils to charge developers or landowners full Band D council tax for every unbuilt development in order to improve the build-out rates of homes with planning permission and reduce the number of stalled sites.
• Give councils more flexibility on business rates reliefs such as charitable and empty property relief and introduce further clampdowns on business rates avoidance along the lines of those introduced in Wales and Scotland.
• Give councils the ability to set their own business rates multiplier, or at the very least be able to set a multiplier above and below the nationally set multiplier.
• Fully localise sales, fees and charges, including road user charges and workplace parking levies. Give councils the flexibility to set planning fees at a local level so that can they cover their full costs relating to planning.

To address the need for more substantive, long-term reform of the funding system:

• There should be a cross-party review of, and debate on, options to improve the local government funding system.
• There is a need for a fundamental review of council tax alongside other council funding sources. We urge all stakeholders to engage in this debate and to seek a sector-wide, cross-party consensus on the future of council tax.
• The cross-party review has to include consideration of whether business rates retention represents a viable future funding model.
• Consider assigning each local area a proportion of nationally collected taxes. It would be for local politicians in partnership with local providers to decide on priorities and the allocation of funding.
• Consider alternative sources of income for local government such as an e-commerce levy or ‘tourism tax’ with the funding retained by local government.
• Consider introducing multi-department place-based budgets, explicitly built around the needs of diverse local communities – with a shared financial and governance framework which will mean that services can better align with local priorities and local duplication of efforts can be eliminated.

Exceptional financial support:

• The Government should assure itself that the current Exceptional Financial Support is achieving its objective of supporting councils in returning to financial sustainability 

Pay:

• It is imperative, that the Government supports [National Living Wage] policy by ensuring local government receives sufficient additional funding to ensure the sector can accommodate an increasing National Living Wage (NLW) in a workable manner. This also applies to the Government’s commitment to “improve public service workers’ living standards throughout the parliament”, which requires a level of sustainable funding for local government that allows the sector to invest in its workforce.
• The Government should allow councils to retain unutilised apprenticeship levy, to be able to redirect that resource into improving local government workforce skills and capacity

Capital Investment Framework:

• Addressing infrastructure, through long term investment, needs to be priority for this spending review.
• The overall framework for capital finance should continue to allow local authorities wide freedoms to borrow and invest, without the need to seek prior approval from government.
   

Priority 2 - A new focus on prevention and services for the wider community

Prevention:

• Ensure that the potential long-term benefit of spending on prevention is routinely considered in both Treasury and departmental spending decisions.
• Strengthen our understanding of which investments maximise improvement outcomes in the short, medium and long-term, and develop a more sophisticated understanding of social return on investment.
• Develop a more integrated, evidence-based approach to addressing the wider determinants of health and wellbeing.
• Recognise the fundamental and universal importance of the environment and public realm to supporting health, wellbeing and prosperity.
• Ensure that everyone has sufficient basic resources and financial stability to be healthy and well and access opportunity, including through national policy on benefits, housing and employment support.
• Develop a more consistent, long-term approach to cost-benefit analysis that enables government, councils and partners to consider both reduced demand pressures in acute services over time, and wider social return on investment.
• Restore the capacity of councils to both pilot and evaluate preventative services, analysing impacts across a wide range of outcomes and over time, to get a more in-depth understanding of where investment is most effective.
• End short-term, prescriptive grants; move towards shared outcomes frameworks, and enable greater freedom and flexibility in place-based budgets and decision-making so that councils can plan and invest in integrated services that meet the specific needs of their local communities.

Welfare:

• Ensure that the mainstream benefit system meets essential living costs and continue to uprate benefits at least in line with inflation.
• Review all welfare reforms that place additional conditionality on specific individuals and households to ensure that they are not increasing hardship. For those reforms that may increase hardship, work with councils and stakeholders to amend them as necessary over time.
• Ensure a planned succession to the Household Support Fund, that enables local welfare schemes to be maintained and work with councils and the LGA to design a more sustainable, preventative approach to local welfare support in the longer term.
• Provide additional funding to the Department for Education to implement a national approach to automatic enrolment for free school meals.
• Work with the Department for Work and Pensions (DWP), councils and the LGA to continue to strengthen data-sharing to increase benefit take-up, support income maximisation and ensure quick and timely access to debt / money advice.
• Empower and adequately fund councils to better shape locally how they engage with their communities.
• Review the current £7,400 income threshold for free school meals, which has remained unchanged since its introduction in 2018, to reach more children who are on the cusp of experiencing food poverty as household budgets are squeezed by rising prices and inflation.
• Ensure that funding is retained for locally-led and integrated approaches to early help when the current phase of Supporting Families funding ends in 2025. Draw on councils’ learning and the national evaluation and restore the previous emphasis on poverty prevention that enabled successful outcomes during phase 2 (Troubled Families).

Public health:

• More investment in the public health grant and in other vital areas of public health and prevention. At a minimum, funding should be restored to the public health grant, which has suffered a cut of 27 per cent in real terms since 2015/16.
• A formal exercise to ensure that the public health grant and the mandated functions that local authorities must deliver, are costed (e.g. how much would it cost to deliver all elements of the Healthy Child Programme?). 
• A review of the public health grant and how it is distributed taking into consideration significant changes in population, deprivation and need. These are changes that have not been taken into full consideration since the transfer of responsibility of public health services to local government in 2012.
• Investment in services, such as health visiting, that give children the best start in life. This investment reduces demands on GPs, hospitals and social care. It means children start school ready to learn and to achieve, so our schools can be more effective. 
• Multi-year settlements for the public health grant and a stronger alignment with the annual local government funding settlements. It makes little sense to treat funding for local government separately and in a piecemeal way.

Culture and leisure:

• We want to see as a first step immediate implementation of the Hewitt report recommendation that the share of total NHS budgets at Integrated Care System (ICS) level going towards prevention increase annually by at least 1 per cent over the next five years, which should include commissioning strategies overseen by Integrated Care Partnerships.
• Within the first year of a new Parliament a ‘Preventive Health Strategy’ should be developed that addresses the wider Social Determinants of Health, all departments, overseen by a cross-departmental ‘Prevention Delivery Unit’ designed to inspire action and monitor delivery.
• Government must also commit to a common standard of data collection, evidence and impact assessment as required by the Integrated Care System locally and government nationally.
• LGA research in 2021 demonstrated a need for a £875 million capital investment in leisure facilities, pitches, and parks. This strategic investment would help build or refurbish 25 new facilities each year over a three-year period, creating a network of hubs specifically designed to help people become more active in their everyday lives. 
• Government will need to identify a continuation or replacement of the Museum Estate and Development fund for civic museums, and provide an immediate injection of funding of around £20 million to prevent immediate closures of key facilities across the country. This funding should support transformation of the service towards a more sustainable delivery model, focused on boosting inclusive access and cohesion. 

Priority 3: Building the homes we need

Housing supply:

• Reform Right to Buy to support 1:1 replacement of existing social housing to avoid continued net loss of stock. This should include allowing councils to retain 100 per cent of sales receipts; permanent flexibility to combine receipts with other government grants; the ability to set the size of discounts locally; and exempting new build homes. 
• Provide further investment in social housing by allowing local government continued access to preferential borrowing rates through the Public Works Loan Board for housing, with each additional £5 million provided through this scheme estimated to provide up to £150 million in savings and additional investment into social housing.
• Increase Affordable Homes Programme (AHP) grant levels per unit to deliver more new affordable homes and ensure inflationary pressures do not jeopardise continued delivery.
• Strengthen Housing Revenue Accounts via a long-term rent settlement of at least 10 years alongside restoration of lost revenue due to rent cap/cuts, to give councils certainty on rental income and support long-term business planning.
• The roll out of five-year local housing deals by 2025 to all areas of the country that want them – combining funding from multiple national housing programmes into a single pot. This will provide certainty and efficiencies and could support delivery of an additional 200,000 social homes in a 30-year period.
• Further investment in the Brownfield Land Release Fund and One Public Estate programmes, with the opportunity for speedy release of public land and housebuilding on smaller council, health and blue light sites. 

Homelessness:

• Uprate temporary accommodation housing benefit subsidy rates to 90 per cent of 2024 LHA rates. This would help councils better manage the costs associated with temporary accommodation and create more resource for prevention.
• Ensure that LHA rates continue to be up-rated to the 30th percentile of local rents beyond 2025/26. This will help prevent a growing number of households from falling into homelessness due to the gap between LHA rates and actual rental costs.
• Introduce a flexible, multi-year, prevention funding settlement, routed through local homelessness strategies and underpinned by a multi-agency joint outcomes framework.
• Introduce a cross-government homelessness prevention strategy, including a commitment to assess the impact of policies on homelessness.
• Introduce a cross-departmental approach to the procurement of housing and support for cohorts including people experiencing homelessness, refugees and asylum seekers, or leaving prison.
• Provide a further round of funding through the Local Authority Housing Fund, to enable councils to acquire empty properties for general needs accommodation, temporary accommodation, and asylum and resettlement cohorts, as well as fund the provision of support.
• Provide £1.6 billion of ringfenced grant funding for councils to commission supported housing, improving value for money and quality.

Priority 4: Supporting our children and young people

• Introduce long-term reform to the SEND system, as set out in the LGA/CCN-commissioned research, which improves outcomes for all children with special needs and is also financially sustainable for councils.
• Write-off all Dedicated Schools Grant deficits to relieve the associated financial pressures that councils are currently facing. Ahead of this, Government should provide councils with certainty on the future of the statutory override for these deficits.
• Provide funding to address the substantial and growing cost pressures of home to school transport, particularly for children with SEND, or work with councils to identify ways to manage demand for, and access to, this service. These immediate measures should be accompanied by longer-term reform of home to school transport.
• Provide additional funding to meet the year-on-year increase in demand for Education, Health and Care Plans.
• We want work to start immediately on a cross-government plan for children, identifying the ways in which all departments and their associated local agencies can support better outcomes for children.
• Provide sustainable funding to enable a move towards preventative and early help services across children’s services and special educational needs and disability provision – making sure that children and families get the help they need, when they need it, and before situations deteriorate.
• Introduce a children’s workforce plan to make sure that babies, children and young people have the right professionals supporting them to achieve their potential.
• At the 2024 Budget, provide certainty over children’s and young people’s funding streams due to end in March 2025 to protect services ahead of the Spending Review.
• End short term and disjointed funding streams which mean councils are unable to plan for the long term and have to direct funding to programmes which do not always align with local need.
• Meet existing cost pressures in children’s social care while also funding additional funding to improve early help services to reduce demand over time.
• Fully fund placements for unaccompanied asylum-seeking children and care leavers.
• Fund the roll-out of well-evidenced interventions to reduce demand for children’s social care placements and retain and expand placement capacity.
• Review the funding paid for early years entitlements to ensure it is properly reflective of the cost of delivery and results in high quality staff. 
• Ensure no further real terms cuts are seen to the youth justice grant. 
• Provide £500,000 to fund an extension to the Return to Social Work programme to bring 200 social workers back to the profession.
• Introduce government-funded training programmes and bursaries to encourage retraining from other professions.
• Provide funding for children’s social care services to expand administrative support for children’s social workers as well as supervision capacity and training.

Priority 5: Reforming and sustainably funding adult social care

• The Government should provide an immediate injection of funding to continue tackling the issues facing the care and support sector.
• All disparate funding streams for adult social care to be brought together into a single pot, allocated directly to councils and with no (or only limited) conditions, and put into the funding base to provide certainty and the ability to plan for the long-term.
• Funding to be more much more outcomes-focussed, linking back to the duties, intent and ambition of the Care Act.
• End the reliance on council tax and the social care precept as a key means for funding adult social care and instead look to national taxation. Formalise national funding for adult social care but with delivery remaining local and frame this positively (for instance fulfilling the ambitions of the legislation) rather than negatively (for instance ‘bailing out councils’).
• Explore the potential for better alignment between adult social care and the benefits system, including for instance Attendance Allowance.
• Commit to a review of NHS Continuing Healthcare.
• Consider a different funding model for younger adults and older people to reflect the different life situations faced by people aged 18-64 and those aged 65 and over.
• Provide new and dedicated funding to help kickstart a more concerted effort to shift to a more preventative model of care and support.
• Take action on care worker pay.

Priority 6: Backing local climate action

Green energy and homes:

• Government should put in place arrangements to revitalise partnership with local government through a Local Green Energy Mission Delivery Programme with responsibility to move forward local government’s contribution within the wider Green Energy Mission governance, and as a first step establish a senior Chief Executive and Leader Sounding Board.
• Ensure that every area is covered by a Local Climate Action Plan agreed by central and local government, with long-term funding certainty to build scale and accelerate project delivery.
• Be involved in the design and delivery of the Warm Homes Plan, leading place-based efforts to reduce emissions from social and private rented homes and exercising their leverage to help owner occupiers.
• A new approach to radically reform the existing national retrofit schemes, including the Social Housing Decarbonisation Fund, Home Upgrade Scheme, and Energy Company Obligation. By pooling funds, a new approach could bring the scale needed to shift towards a place-based allocations model of funding retrofit outcomes to build certainty and long-term plans for local government and supply chains, and away from the challenges of dealing with fragmented competition pots. We also need flexibility across retrofit effort to include adaptions building resilience to the impacts of climate change, in particular overheating and flooding. 
• Flexibility to shape and deliver interventions via an outcomes framework. This will allow them to connect it with other interventions on carbon reduction, fuel poverty and public health. 
• Explore options to exercise existing duties to support the private rented sector to meet minimum energy efficiency standards, which have been so far difficult to exercise due to resource pressures.
• See a similar approach [as suggested above for minimum energy efficiency standards] into non-domestic buildings, in decarbonising the public sector estate. Reviewing the Public Sector decarbonisation Fund and the relationship with GB Energy towards a ‘one public estate retrofit’ programme.
• Make the Future Homes and Building Standard more ambitious with mandatory requirements for roof top solar PV and battery storage. The standard could do more to reduce embodied carbon in building materials and promote resilience to climate change, such as efficient cooling.
• Work in partnership with community energy companies to deliver small and medium-sized renewable energy projects.
• Bring forward small and larger [renewable energy] projects on their own, perhaps using their own land and assets or with powers to engage other public sector bodies on using their assets. 
• Provide strategic local energy planning advice working with communities and energy system partners to identify sites for renewable power projects, grid constraints and opportunities. 
• Bring about energy system reforms alongside other spatial plans, balancing land-use pressures for growth plans, new housing, nature recovery, infrastructure, transport etc. underpinned by work with communities to build trust and support, including community benefit models.
• Play a lead role in expanding the delivery of heat networks through the heat network transformation programme, and associated policies such as zoning, and align these within the wider GB Energy and Local Power plan.

Waste:

• Rather than placing ETS costs on councils, they should be recovered directly from producers for different material categories via the simplest routes possible. This would best incentivise the reduction in fossil-based material and generate the revenue to invest in long-term solutions, such as carbon capture and storage. 
• Current proposals to introduce the packaging Extended Producer Responsibility scheme should re-commit to full net cost recovery for local government’s packaging waste services. This must mean moving from the current ‘modelled’ costs to ‘actual’ costs as soon as is possible. Our modelling has highlighted some risks in the current modelled approach, concerns about underfunding of local government.
• Current proposals for a Simpler Recycling policy to reverse plans to limit local authority flexibility on the frequency of household residual waste collections, as evidence shows less frequent residual waste collections can increase recycling and reduce costs. Also, Simpler Recycling reforms should rapidly provide certainty on food waste new burdens funding and review funding levels in 2027 to meet shortfalls, align household and non-household simpler recycling reform commencement dates. 
• A review of recent waste disposal decisions, including to fully fund local authorities with the disposal infrastructure for Waste Upholstered Domestic Seating with Persistent Organic Pollutants, and to remove recently introduced restrictions preventing local authorities for charging for ‘DIY’ waste. 
• Discussion on the scope and opportunities for bolder regulatory action to reduce waste and related emissions created in the first place. Such as regulating the use of materials in products either to limit or require use of different materials. 

Nature:

• Put in place Local Nature Recovery Strategies as the building blocks at the centre of the national effort for nature recovery. LNRSs are currently being developed with communities, landowners, farmers, and other partners, and should hold the levers over all policy and funding schemes (such as tree planting, and ELMS) that turn community will around spatial strategies into deliverable projects attracting private finance.  
• Ensure that the new mandatory Biodiversity Net Gain (BNG) is a success and does not hold up housebuilding by providing more support and flexibility for councils to help stimulate the off-site BNG market and devolve national “credits” to support local action on nature recovery. 
• Lead local efforts to deliver nutrient neutrality mitigation actions to enable housebuilding, supported by further flexibility in funding and with more robust government action to reduce pollution at source.  
• Link local nature recovery efforts into wider local spatial plans for housing, growth, energy infrastructure and transport, and gaining community buy in for action across the different agendas; potentially through land-use principles.

Clean transport:

• Local government should be empowered through policy and funding certainty to bring about a whole-place transport decarbonisation strategy by devolving to places the means to locally mix active travel, electric vehicles, and public transport schemes. 
• Local government should be supported where they would want to implement demand management schemes such as workplace parking levy, congestion, and clean air zones. 
• Local government can develop local transport decarbonisation programmes as part of wider strategies for decarbonising energy, improving air quality, and connecting with new housing and development in ways to support economic growth.

Cross-cutting actions underpinning the Green Energy Mission:

• Moving towards a smarter, simpler, more coherent, and sector-led support offer that builds on the LGA’s existing programme of improvement work and helps local government build resources and capacity to realise its potential in delivering the green energy mission, alongside greater clarity of its role and powers. The current support landscape is fragmented and can lack the depth to make a significant difference.
• Delivering a step change in community engagement to get public buy-in across the green energy mission, to help realise public and co-benefits, support the ‘able to pay’ market to invest themselves, and to help achieve a just transition.
• Options for providing scale through partnership, empowering local authorities to come together and with other public sector agencies to pool skills, experience, and projects into programmes, with a focus on attracting private sector investment.
• Linking the green energy mission with devolution, growth plans, workforce, skills and supply chain agendas; while moving towards a governance model that supports all local authorities everywhere to make progress, by building on their current strengths.
• As far as possible align clean energy action with efforts to build climate resilience that prepares people and places to extreme heat, drought, storms, and other threats. This could include a further review of the National Adaptation Programme to accelerate action on this agenda.

Priority 7: Delivering inclusive growth

Devolution and growth:

• Establish a new enhanced framework for wider devolution across England which is underpinned by local government's pre-eminent place-shaping role and is combined with sufficient funding so that all councils, including in combined authority areas, can deliver local growth priorities, going beyond their statutory obligations.
• Ensure that Departments use analysis of new policy initiatives to consider the benefits of local government acquiring new policy powers and/or fiscal power to take control of growth policy. It would embed a culture of ‘thinking local’ in the UK’s centralised decision-making structures.
• Explore the potential for local fiscal freedoms as part of a commitment to further devolution. We are aware the fiscal environment is constrained and will continue to be so for some time, and there are not immediate sources of additional local funding. 
• Shape the statutory requirement for local growth plans to ensure they are as least resource intensive as possible and that local areas are sufficiently resourced and have capacity to deliver this new burden.
• Work with LGA on the English Devolution Bill so that all councils, including in mayoral combined authorities, can play a full and meaningful role in delivering inclusive growth
• A simplified, consolidated approach to growth funding, allowing local leaders the flexibility in where and how investment decisions are made locally – be it in our high street infrastructure, connectivity and mobility infrastructure or investment in the skills and productivity of local people and businesses. Competitive bidding pots should be consigned to history.
• Current funding levels being treated as a baseline. The previous Government’s growth-related spending commitments should be regarded as a floor for future funding. 
• Funding agreements that are long-term, over a 6 to 8 years basis. Delivering the Government’s missions, including inclusive growth and removing the barriers to opportunity, will take many years to address. Policy and funding commitments need to match this timescale and allow for movements between years. This will allow a greater focus on preventative measures.
• Recognition of the importance of revenue funding. Inadequate revenue funding undermines the potential of transformative capital-intensive projects.
• Timely funding. A co-design approach to designing of funding pots from the outset, so that time is maximised on actual planning and delivery and levering in private investment, and not on administration of the fund.
• Flexibility to respond to the continuing transformation of local government, such as devolution approaches, and increasing use of shared services and resources. Government policy should evolve to receive submissions from larger areas that are subject to collaborative agreements. The use of match funding should be further incentivised and encouraged where appropriate. 
• Consider bridging arrangements whilst Government redesigns its approach to growth funding. Our preferred solution is that the Government provides one-year additional funding that is equal to year 3 of UKSPF. 
• If this is not possible, any new growth funding stream should allow the flexibility for current lead authorities to identify projects at risk and use funding to continue provision for 12 months.
• Provide a decision on the third round of the Levelling up Fund urgently.

Mobility (transport):

• Commit to the same spending plans of the previous Government, as set out in Network North. For highways maintenance, that is an additional £8.3 billion spread between 2023/24 to 2033/34 on top of existing levels of funding – which in 2023/24 was £1.125 billion plus £260 million from the Integrated Transport Block. If this commitment is delivered, this should result in an average of £2.14 billion a year of Government contribution to local highways maintenance – an annual increase of 54 per cent.
• Recognise that the £16 billion backlog of road repairs cannot be fixed over a single Parliament. It requires a long-term funding package, creating the incentives for greater cost-saving innovations and a focus on longer term preventative resurfacing programmes.
• Ensure that transport infrastructure funding is consolidated, long-term and flexible, providing certainty to assist longer-term planning, and the ability to flex to meet longer-term priorities. 
• Commit to existing levels of funding for buses as a minimum, including through Bus Service Improvement Plan (BSIP) funding, BSIP plus, Bus Service Operators Grant (BSOG), concessionary fares support and the national £2 fares cap.
• Reform and simplify government funding and subsidies on buses and devolve to local authorities as a long-term package of support so that transport authorities can shape bus services and ensure public funds can be better targeted to meet local priorities and help get passenger numbers back to pre-Covid levels and beyond.

Employment and skills:

• Our new Work Local employment and skills offer recommends practical steps the Government can take working with us to improve services across England via three interlinked offers:
  
  • Youth Pathways – to help young people (age 16-24) not in employment, education or training (NEET), or at risk of being so, find their first job or put them on a career path.
  • Working Futures – for adults who are disadvantaged in the labour market, and who need personal support to find work or better work.
  • Skills for All – to provide a better match of skills supply and demand, a skills and learning offer linked to local careers advice and jobs, and promote lifelong learning.
• A ministerial-led joint national board and a joint unit of Whitehall and local government officials to coordinate planning.
• A new ‘duty to co-operate’ on all partners.
• An improved ‘Universal Support’ delivered through local government, and joint work and co-location of jobcentre plus and councils.
• An early call for new initiatives or pilots.

Economic inactivity – universal support:

• Joint work between DWP and councils to agree numbers of people to be supported [via Universal Support] per area and the overall funding envelope.
• A clear timetable for phasing in [Universal Support] across England and Wales.
• Implementation funding to stand up the service alongside funding for front line delivery.
• Maximum flexibility over which residents they prioritise and the type of supported employment they choose to deliver.
• Ability to use funding across years rather than annual allocations.
• A change to the name of the programme so it does not get conflated with Universal Credit.

Digital connectivity:

• Strengthened investment and innovation to ensure universal access to high-quality digital infrastructure.
• Government to provide a clearer assessment of the costs to councils, communities and businesses arising from the switchover from the PSTN to full-fibre solutions.

Priority 8: Safer streets

Community safety:

• Invest in communities hardest hit by recent violence to ensure extremism does not thrive. This includes Youth Hubs and diversionary activities for young people.
• Reform the duty and partnership landscape to ensure Community Safety Partnerships are equipped with the powers and partners to deliver.
• Ensure Community Safety Partnerships are adequately resourced to deliver.
• Make sure Community Safety Partnerships have the intelligence and data sharing capabilities to prioritise local responses.
• Introducing long-term sustainable funding arrangements of three to five years for community-safety related funding paid directly to councils or community safety partnerships rather than for example to police and crime commissioners, would permit better forward planning and achieve better value from contracts. So would combining funding into single streams rather than separate pots.
• Provide additional funding to increase community safety partnership capacity (such as additional analytical capacity, wardens, CCTV), with local discretion about how it is used to achieve the government’s mission to ‘take back our streets’. 
• Reform the duty and partnership landscape to ensure Community Safety Partnerships are equipped with the powers and partners to deliver. This would help government hold CSPs to account for existing duties, know where to place new duties and ensure CSP effort is spent on delivery as opposed to resolving governance issues. It is suggested this work is carried out between the LGA and the Association of Police and Crime Commissioners (APCC).
• Government investment in council services that help the local government prevent crime would include:  
  
  • services that address adverse childhood experiences and also improve mental health and wellbeing
  • youth and children’s services, particularly those that engage with children and young people on the fringe of the criminal justice system
  • SEND and speech and language provision
  • homelessness
  • public health measures that address the social determinants of health will also reduce vulnerabilities to and the risks of engaging in crime
  • substance misuse treatment
  • support to design out crime
  • perpetrator programmes.

Community cohesion and countering extremism:

• The LGA supports the Special Interest Group on Countering Extremism (SIGCE). Their work is vital in the recovery from the violent disorder witnessed across England in the summer of 2024. The group shares both intelligence and best practice on countering extremism and building resilient communities. The annual cost is £30k per annum. As part of the recovery, continued funding from government for SIGCE would be welcome. If funding could increase to £100k, SIGCE would be able to carry out more intensive and targeted support to areas affected by recent violent disorder. This could include peer reviews targeted at cohesion functions and an upgraded online portal to replace the existing, limited, knowledge hub.
• Ensuring continuity of or increasing the current asylum funding for councils could also support local capacity to more effectively integrate asylum seekers, foster welcoming communities and reduce risks of anti-asylum activism.

Building new prison places and introducing tough new penalties:

• Councils could, as part of Community Safety Partnerships, maintain a pipeline of visible community action schemes that could be deployed for forms of community sentencing. This would allow a saving of £51,724 per annum, per person as well as judicial cost. Councils would require new burden funding to carry out this activity and resources would be required for the probation service to manage such schemes. This would however have a positive impact on the visibility of justice as well as reducing the burden on the prisoner estate.

Reducing anti-social behaviour and serious violence:

• On anti-social behaviour (ASB) – commission legal advice on a model data sharing agreement for councils and CSPs. This model data sharing agreement could be accompanied with some guidance on how best to record, store and share data sets. This will be essential for accountability and the track government progress. The cost of legal advice would be circa £20k and the cost of accompanying advice circa £10k.
• Anti-social behaviour can be related to sale and distribution of alcohol. Licensing fees have not been updated since 2005. By enabling councils to set licensing fees under the Licensing Act 2003, councils would be able to set fees that take account of the local conditions and environment they know best. Locally set fees would help councils face shortfalls in administering their statutory obligations under the Licensing Act.

Rape units and halving violence against women:

• On a special rape unit in every police force – Councils can often rehouse perpetrators more easily than victims and their families can. This is especially the case where one bedroom apartments are available. Councils should be given the powers to do so under part 4 of the duties. Councils can expand the number of possible providers for specialist services if longer term funding was awarded. Also government needs to fund local authorities adequately for such services to continue.
• Continuing to fund successful existing programmes, in particular funding for implementing the Domestic Abuse Act and work to address serious violence and anti-social behaviour hotspots could have a significant impact.
• Providing additional funding to assist with the costs of carrying out domestic homicide reviews would assist in the families and friends of victims receiving justice and the comfort in knowing lessons will be learned.

Reducing knife crime and creating a new network of Young Futures hubs:

• Get knives off our streets – Councils could boost their trading standards and ability for these departments to understand younger people and their behaviour through employing apprentices. This would also replenish the workforce, the cost of which would be up to circa £3.9m per annum if every trading standards was given a dedicated apprentice. This could be partially funded from allowing councils to charge on a ‘polluter pays’ principle when someone is in breach of licensing conditions. This is similar to how the Health and Safety Executive already operates. National Trading Standards is currently participating in a Home Office legislative review on knife sales to children. To be effective the outcomes of this review require funding, both specifically and in terms of the overall workforce challenge facing regulatory services.
• To work constructively with the government on the Young Futures programme will require new burdens funding. Youth Hubs should be considered for piloting in the areas most impacted by recent violent disorder.
• Undertaking a review of Youth Justice Board funding for Youth Offending Teams and the prioritisation of existing funding would allow a greater focus on prevention and diversion. It would also bring funding for remand placements in line with actual costs.