Amid ongoing financial, economic and political uncertainty, the LGA continues to call strongly for a long-term government plan to put councils’ finances on a sustainable footing.
The LGA has calculated that rising inflation, National Living Wage and energy costs have left councils facing £2.4 billion in extra cost pressures this year, with estimated funding gaps of £3.4 billion in 2023/24 and £4.5 billion the year after (see p10).
As first was going to press, the political and financial situation was extremely unsettled, with former Health and Care Secretary Jeremy Hunt replacing Kwasi Kwarteng as Chancellor and further announcements expected.
However, the LGA has warned against further cuts to local government funding, after councils lost £15 billion of central government funding between 2010 and 2020.
Without extra funding to meet demand and cost pressures, and given the funding gaps they are seeing, councils would have no choice but to implement significant cuts to services, including to those for the most vulnerable in our societies.
Underfunding local services also has a knock-on effect on the wider economy and other public services – something illustrated not least in adult social care.
Around one in five residential care workers is living in poverty according to the charity the Health Foundation, with low pay contributing to long-term recruitment and retention problems in the sector.
The consequence is more pressure on those still working in care, poorer services for some of our most vulnerable residents, and hospitals unable to discharge patients because of care staff shortages.
It’s why the LGA has called on the Prime Minister to deliver on her pledge to provide £13 billion to tackle the crisis in adult social care, of which £3 billion is needed to improve care worker pay and help recruit and retain staff.
With adequate funding, councils can protect and invest in local services, deliver for our communities, support economic growth and level up everywhere.