Council spending down by a third since 2010, CIPFA research finds

20 Jul 15

Council spending in England fell by almost a third over the duration of the last Parliament, with housing and planning the areas that were hardest hit, CIPFA analysis has found.

Today’s figures show that, since 2009/10, local authorities’ per capita spending will have decreased by 17.2% in cash terms. Adjusted for inflation, this represents a drop of 32%.

Housing is estimated to have experienced the biggest loss, with a 9.9% budget reduction, followed by planning and development, which is down by 9.8%.

However, other services have also experienced spending cuts, including adult social care (-2%), education (-2.4%), cultural services (-4.5%) and children’s social care (0.4%).

However, funding for highways and transport increased by 2.2%, with much of this investment concentrated in London and the South East.

Regionally, spending has dropped across the country in 2015/16 compared to the previous year. The sharpest declines were found in the North of England. The North East saw the biggest spending cut at 4.9%, followed by Yorkshire and the Humber (-4.7%) and the North West (-3.2%).

The only exception was in the South East of England, excluding Greater London, where spending was flat.

CIPFA chief executive Rob Whiteman said the figures showed there has been little respite in funding reductions to council budgets.

“To survive in this tough economic climate it’s absolutely right for councils to have a rigorous focus on value for money and work more effectively with the wider public sector to deliver savings for taxpayers and better outcomes for local communities,” he said.

“That’s why we believe there needs to be substantial reforms to our systems of public financial management with greater alignment of local public services and for the government to budget for the medium to long term if public services are to be sustainable over the next decade.”

Responding to today's analysis, a Department for Communities & Local Government spokesman said: "We have worked closely with councils to design and put in place schemes such as the Troubled Families programme and the Better Care Fund that will help deal with some of the long-term pressures on their budgets. And we are devolving powers and budgets to help areas grow their local economy and keep more of what they earn.

“In the run up to the Spending Review and next local government settlement we will continue to listen to the views of councils, the Local Government Association and others about the best way of distributing funding and meeting the demand for services in order to achieve fairness, efficiency and local economic growth.’

Earlier this month, CIPFA published research showing that most of the reserves held by UK councils had been committed for specific purposes. Just £3.7bn was left as general reserves in local authority accounts, it said.

  • Vivienne Russell

    Vivienne Russell is managing editor of Public Finance magazine and publicfinance.co.uk

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