A £14.4 billion funding black hole threatens to swallow public services, say the council leaders of the Local Government Association.
A LGA statement said: ‘The Local Government Association has updated its Funding Outlook Report to incorporate the additional 10 per cent real-terms cut to council funding for 2015/16, which was announced last Wednesday (26 June).
‘This cut comes on top of the 33 per cent real-terms cut which will be made across the 2011/12 to 2014/15 comprehensive spending round period.
‘The model also incorporates the widening of the health budget to allocate £2.1 billion to adult social care services in 2015/16…
‘The updated outlook reveals that the financial black hole facing local government is widening by £2.1 billion a year and will reach £14.4 billion by 2020.
‘The analysis also reveals that the black hole is growing at a rate £100 million-a-year faster than it was this time last year, indicating that the current funding system is broken and that a radical overhaul of the way services are provided and paid for is required across the entire public sector.’
Brian Strutton, GMB National Secretary, said yesterday: ‘This bears out GMB’s prediction that in addition to 420,000 lost council jobs since 2010 we could be facing another 70,000 loss over the next year, heaping tragedy on top of misery.
‘There are four things that could be done.
‘Firstly, councils need to defy government and raise council tax – they can’t complain of lack of funding if they don’t.
‘Secondly, government has to recognise that the rising adult social care bill, the main cause of runaway costs for councils, cannot be met any other way than through direct taxation.
‘Thirdly, local and central government should stop wasting resources trying to eke insignificant savings out of basic frontline services that are working perfectly well.
‘Fourthly, we need to be more honest with the public about the state of their local councils and if, as the chair of the LGA said yesterday, there are 56 councils whose finances are unsustainable, they should be named so that their communities can stand up for them like they do for their local NHS.’