County Councils face a 50bn black hole

Pricewaterhousecoopers LLP analysis for the County Councils Network (CCN) warns that councils face a £50bn black hole over the next six years due to rising demand for services and increasing costs. Cllr Paul Carter, chairman of the County Councils Network, said: “Over the last decade councils have played a crucial part in reducing the deficit, but the yearly compounding effect of funding cuts and rising demand means that the situation is fast becoming untenable. This research demonstrates the need for government to provide all councils with additional resources at the Spending Review, with the most significant financial challenges being experienced by county and metropolitan authorities most in need.” The analysis reveals that raising council taxes and increasing efficiency will not be enough to fill the funding gap. The report claims that spending on adult social care will rise by over 6bn nationally by 2025 compared to a decade before. The County Council networkCN claims that even with local authorities using their reserves and yearly rises in council tax, they “will not be anywhere near enough to fill the funding gap” “Today’s report concludes that counties are most exposed and least able to address these financial pressures – local government is at the limit of elasticity. Therefore, this spending review is crucial if we are to protect and enhance services.” Mr Carter continued: “If government does not provide additional funding for councils over the medium term, many local authorities will resort to providing the bare minimum, with many vital services all but disappearing, particularly preventative services. “Even these draconian cuts won’t be enough for many well-run councils to balance the books and it will leave our finances in disarray with many of us struggling to deliver even the basic level of local services. The CCN director Simon Edwards said the report laid bare the “stark reality facing the sector and severe financial challenges” now being felt by all types of councils. “PwC’s report provides a platform for the sector to unite around ahead of the Spending Review and make a united case for additional funding, while also recognising that the diverse circumstances faced by different types of councils to influence the fair funding review,” he added. Staffordshire County Council leader Philip Atkins told the BBC: “We really need a proper adult, cross-party debate on the future funding of adult social care. “We need to know how we are going to fund this in the future. “It can’t fall just on the council tax and the business-rate payer.” A government spokesman said: "We are investing in Britain's future, and this year's local government finance settlement includes extra funding for local services. "Local authorities will have access to £46.4 billion this year, a real term increase that will strengthen services, support local communities and help councils meet the needs of their residents. The government will be looking at funding for services as part of the spending review." The Pricewaterhousecoopers LLP analysis for the County Councils Network (CCN) provides stark evidence of the funding Gap in the provision of adult social care services. What is also alarming is the impact on other services provided by local authorities. The government is fully aware of the plight of the councils and the ever-increasing demands of an ageing population. I am in full agreement with the sentiments of Philip Atkins Leader of Staffordshire County Council. The reliance of funding adult social care through council tax and the business-rate payer cannot deliver a quality adult social care service and unless we can achieve cross party consensus on the way to pay for it, we will continue to see an ever decreasing level of adult social care provision. Albert Cook Albert Cook BA, MA & Fellow Charted Quality Institute Managing Director Bettal Quality Consultancy