Councils forced into ‘extremely worrying’ hardship while ministers dismiss cuts warnings, say MPs
Councils are being forced into “extremely worrying” positions to keep local services running while ministers refuse to face up to the “perilous” impact of cuts, MPs have warned.
The Public Accounts Committee (PAC) say the financial standing of authorities “is continuing to deteriorate” as they criticised what they called the Government's short-term approach to tackling problems.
They warn that on long-term issues such as social care, authorities are being forced to overspend while cutting other key services, using their reserves, or relying on other risky sources of income.
The hard-hitting new report came as ministers confirmed plans for an extra £1.3bn of “real-terms” investment to tide over councils in 2018-19 and 2019-20 for issues including social care and roads.
The committee of MPs uses its new report to hit out at the Government’s “unacceptable lack of ambition” for the sector, saying ministers have “no aspiration for improving local finances beyond merely ‘coping’”.
It also questioned whether the additional money would be spent “efficiently” given minister intend for over £700m to be spent by the end of this financial year.
Elsewhere the group of MPs says it is “unacceptable” that ministers have refused to lay out how the Government had concluded that councils as a whole are on a sustainable footing, when groups such as the Local Government Association, local authorities and other representative bodies are “seriously concerned”.
The chair of the committee, Meg Hillier, said the Government had failed to acknowledge the knock-on effect of its approach on the likes of youth services.
She added: “The Government is in denial about the perilous state of local finances. It insists the sector is sustainable yet is unwilling or unable to back up this claim.
“Flimsy assertions have no place in financial planning. The fact Government has bailed out councils with short-term fixes should be evidence enough that all is far from well.
“Government needs to get real, listen fully to the concerns of local government and take a hard look at the real impact funding reductions have on local services. And then it needs to plan properly for the long-term.”
The group add that they are “deeply frustrated” at repeating their concerns, after the Government “rejected” a number of previous recommendations.
Shadow Communities Secretary Andrew Gwynne said: “This report exposes a human and financial crisis of the Tories’ own making.
“Local government is under enormous pressure because of politically motivated cuts that have hit our poorest areas hardest.
“Nine of the ten most deprived councils in the country have seen cuts of almost three times the national average.
“And when you cut vital support services in such areas, social problems grow – and demand for those services only becomes greater.”
Communities Secretary James Brokenshire said: “This year’s settlement paves the way for a fairer, more self-sufficient and resilient future for local government.
“That is why local authorities will have more control over the money they raise and a real terms increase in their core spending power.”
“The settlement also recognises the pressures councils face in meeting growing demand for services and rewards their impressive efforts to drive efficiencies and rebuild our economy.”