LGA: councils face £5.8bn funding gap by 2020

5 Jul 17

Councils face a funding gap of £5.8bn by 2020 and should be “at the front of the queue” for spending if the government retreats from austerity, according to the Local Government Association.

Addressing the LGA’s annual conference in Birmingham yesterday, chair Lord Porter said: “The money local government has to provide vital day-to-day local services is running out fast.

“There is also now huge uncertainty about how local services are going to be funded beyond 2020.

“Councils can no longer be expected to run our vital local services on a shoestring. We must shout from the rooftops for local government to be put back on a sustainable financial footing.”

The LGA launched a report yesterday, Growing Places, that said even if councils stopped discretionary spending, such as filling in potholes, maintaining parks and open spaces and closed all children centres they would not be able to plug the funding gap.

Porter, the Conservative leader of South Holland District Council, told conference delegates that in future “every penny in local taxation collected locally must be kept by local government and spent on our public services”.

He also called for an end to the cap on council tax increases, which is effectively imposed by the requirement for a referendum for increases in excess of 2%.

Porter concluded: “If austerity is coming to an end, then we need to make sure councils are at the front of the queue for more money.

“Only with adequate funding and the right powers can councils help the government tackle the challenges facing our nation now and in the future.”

Making its case for better funding, the LGA said that by 2020 English local government will have lost 75% of the core central government funding that it had in 2015.

It pointed out almost half of all councils – 168 – will no longer receive core central government funding by 2019/20.

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