By Vivienne Russell| 27 November 2013
Councils in the Midlands and North of England are facing much deeper cuts to their funding than those in London and the South, an analysis by the Special Interest Group of Metropolitan Authorities has revealed.
It warned that the scale of these funding losses could put some councils at breaking point, while the economic recovery could bypass some parts of the country entirely.
Sigoma estimated the funding councils in each English region would lose on a per head basis by 2017/18, factoring in the impact of welfare reforms such as council tax support and Housing Benefit cuts. The region hardest hit was the Northeast, with a funding loss of £665, followed by the Northwest with £665.
The Southeast fared best, with a loss of £305 per head, followed by the Eastern region with £427. London councils had an average funding lose of £436.
For England as a whole, the average funding lost to councils was £487, but looking at Sigoma councils in isolation, this increased to £685.
Sigoma said the government was moving away from funding councils on a needs basis. It highlighted the council tax freeze grant and the New Homes Bonus, which have been funded by top slicing needs-based revenue grant. This had the effect of moving funding away from areas in greatest need, Sigoma said.
The government had also failed to take account of the cumulative effect of cuts on councils, meaning that some authorities were being hit over and over.
Sir Steve Houghton, chair of Sigoma and leader of Barnsley Council, said: ‘Sigoma’s report shows that government’s complete disregard for the mounting pressure faced by certain councils and the pain it is causing their residents.
‘The government must make fair funding a key priority to allow councils to provide essential services without the growing distraction of a service failure.’
Dave Watts, MP for St Helens and chair of Sigoma’s MP group, added: ‘Councils with the most residents with the greatest need, like St Helens Councils, are facing the highest levels of cuts.
‘This is wrong and means that we can’t give help to people who need it most. The coalition government needs to act now to limit the damage. Fair funding of local councils would help reduce the gap between the rich and the poor and ensure that we don’t fail the most vulnerable people in the country.’
