More than one in three councils believe financial constraints may stop them delivering their legal duties, research by Localgov’s sister title The MJ and think tank LGiU has found.
The findings come a day after communities secretary Eric Pickles boasted how the Government was keeping down council tax bills with local authorities wanting an increase higher than 2% told to hold a referendum.
But with council tax effectively capped, council bosses have warned that radical action is needed if local authorities are to prove financially sustainable.
Some nine in 10 senior council figures surveyed said that the local government finance system was not fit for purpose.
Editor of The MJ Heather Jameson said: ‘Our survey shows just how close to the edge of financial collapse some councils find themselves.
‘With increased pressure on services – particularly adult and children’s care – and the squeeze on their finances, making ends meet is no longer guaranteed.
It is becoming increasingly obvious that the local government finance system is just not working anymore. Consecutive governments have looked at the problems, but have failed to act. Wednesday’s announcement does little to address this.
Chief Executive of LGiU, Jonathan Carr-West, added: ‘The reality is that unless all parties can agree a radical future for council funding, everything from road sweeping to social care will be increasingly difficult to deliver.
‘Council tax is locally collected but in practice can’t be raised due to the Government's insistence on local referenda.
‘Funding of statutory services cannot be sustained if the local government finance fudge continues.’
