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Councils are reaching breaking point – the status quo cannot continue

Councils are reaching breaking point – the status quo cannot continue
4 min read

A government that once trumpeted its strength and stability is delivering neither for our local authorities, writes Mike Amesbury

Since 2010 Local Authority funding has been in crisis.

Year-on-year support and funding from central government to our councils has been cut and services have been reduced.

At the same time, demand for these services is on the increase, in many cases rapidly.

Even with due recognition for the excellent and impressive way many council leaders have risen to what is an unprecedented challenge, this “perfect storm” has left local government on the brink – and in the case of at least one council, helped push it over. The pressures Northamptonshire faced are not unique either. It is telling that last week’s report into what brought Northamptonshire County Council to issue a Section 114 notice made clear that the authority was not in a significantly worse position funding wise that some other authorities.

Warnings about the scale and depth of the crisis have been made by all parties – the cross party Local Government Association has said loud and clear that the current approach cannot continue without consequence. And despite the cuts – disgracefully and unfairly - hitting the poorest areas the hardest, protests have not been limited to Labour led councils. Last year, Conservative Surrey County Council threatened a 15% Council Tax rise in an apparent effort to highlight the gravity of the situation. While this helped elicit some response from the government, it is yet to act beyond short term, precept based fixes, piling the pressure of filling funding gaps onto local taxpayers. Many councils I have spoken to talk of a “cliff edge” in 2020 - with not enough clarity on how new business rate retention funding models will work.  

Earlier this month, the warnings that had been coming for some time from the local government family were echoed and amplified much closer to home for the government.

The National Audit Office published their report “Financial sustainability of local authorities 2018”. The picture it paints is familiar to Halton and Cheshire West and Chester councils in my constituency, as it doubtlessly will be across the country.

It puts the crisis into stark perspective; central government funding is down by almost 50%, whilst demand for many services is rising. It finds that the number of households entitled to homelessness support increased by 33.9%; the number of looked-after children grew by 10.9%; and the estimated number of older people needing care increased by 14.3%.

For many authorities the rise is much greater, and the funding gap even wider.

At the same time, councils are struggling with cost pressures arising from government policies, such as paying for the National Living Wage and Apprenticeship Levy.

As councils try and square the circle of greater need, and reduced grant funding, the tax burden has inevitably shifted significantly onto local taxpayers.

Even with these tax rises, the NAO conclude that there “are now risks to statutory services”.

If the current picture wasn’t poor enough for the government – the report gives a damning assessment of the government’s planning for the future. They confirm the fears of many in local government that, alarmingly, the government “does not have a long-term funding plan for local authorities”.

A government that once trumpeted its strength and stability is delivering neither for our councils. 

On Tuesday, my Westminster Hall debate offers members across the House the chance to highlight the severity of the crisis, and the need for action in the immediate and longer terms. The status quo simply cannot continue. Councils, and by extension the services our communities rely on, and the dedicated staff who provide them, are reaching breaking point.

It’s time the government listened to local government. I’m confident that others – from all parties – will be taking the chance making a similar case too.

Mike Amesbury is Labour MP for Weaver Vale and a member of the MHCLG Select Committee. He is a former Manchester City Councillor. His Westminster Hall debate will take place on Tuesday 20 March.

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