Local authorities have strived to shield residents from the impact of cuts, but with another £10 billion worth of savings to be found, we’re approaching a tipping point where options are fast running out. The next two years will be the toughest yet for those who use and rely upon the popular local services councils provide.
Survey findings published by the Local Government Association (LGA) suggest that councils may be reaching ‘the end of the road’ for managing cuts through efficiency savings alone.
The LGA’s report, ‘Under pressure – How councils are planning for future cuts’, outlines the pressing problems faced by local government, acknowledging that cost pressures created by social housing services are among these.

It also explores a range of common council strategies which councils may use to tackle the fiscal challenges of 2015/16. For example, around 18 per cent of councils are thinking of increasing their local tax base by encouraging further house building. This, we are told, ‘has a double financial effect of providing council tax revenue from additional occupied homes and new homes bonus funding from central government.’

However we are reminded that, ‘Aspects of economic and housing growth are outside of local authority control, which also makes relying on these strategies to balance the budget difficult.’ The report highlights a range of other issues. For example:

‘In total, 60 per cent of authorities say that under the current circumstances they will not be able to cover their budget gap with future efficiencies alone in 2015/16.

‘Almost a third of councils mentioned that they have very little or no scope to reconfigure services further and that some service cuts are inevitable while another third believes that while the scope for further efficiency is still available, it is not enough to avoid any consideration of reducing the services offered to local residents.’

The LGA’s survey quantifies the extent to which councils think they can use efficiencies to tackle the fiscal challenges of 2015/16:

  • No scope for efficiencies: 30 per cent
  • Efficiencies are available but not enough: 30 per cent
  • Efficiencies enough to deal with the challenge: 19 per cent
  • Strategy unclear: 21 per cent

Finally the report suggests, ‘Government can help by loosening strings on local government and local partners. It should enable and encourage close working and sharing of resources between councils and agencies as well as provide a supportive environment for further innovation.’