Local authority budgets cut again

Local authority budgets cut again

Local authorities will see their spending power reduced by 1.8% on average in 2015/16, following cuts to funding by the government, but some councils could face a 6.4% reduction.

The announcement comes on the same day that the funding of libraries has come under the spotlight with the release of the government-commissioned Sieghart review.

Announcing the provisional local government finance settlement for next year, local government minister Kris Hopkins said the settlement was “fair to all parts of the country – whether north, south, urban or rural”.

Spending power combines central government funding – the main source of funding for local councils – with one-off grants and charges like council tax and business rates.The Local Government Association (LGA) says that councils across England will receive 8.8% less funding from government to run local services in April 2015, meaning some may choose to stop services to make savings. It estimates councils will need to find £2.5-£2.6bn in 2015/16.

LGA chair David Sparks said: "Today's settlement confirms the huge financial challenge local services now face.

"Councils have spent the past four years finding billions of pounds worth of savings, while working hard to protect the services upon which people rely.

"But those same efficiency savings cannot be made again. The savings of more than £2.5bn councils need to find before April will be the most difficult yet. We cannot pretend that this will not have an impact on local government's ability to improve people's quality of life and support local businesses.

"It is individuals who have paid the price of funding reductions, whether it is through seeing their local library close, roads deteriorate or support for young people and families scaled back."