Nine out of ten councils said they have maintained service quality in the last year, but only one in six councils think this will continue over the next five years, new research has found.

The report, published by the Institute for Fiscal Studies (IFS), found councils facing the biggest cuts up to 2020 are more likely to have concerns over the quality of services in the future.

Upper-tier councils with responsibility for social care are less optimistic about service quality than shire district councils, according to the report. Nearly three-quarters of upper-tier councils thought cuts would be evident to the public in 2017-18, compared to just 15% of shire district councils.

The report, based on surveys from the Local Government Information Unit (LGiU) and PwC, also found two-thirds of councils were unable to determine if they will gain or lose financially through the retention of business rates scheme.

David Phillips, associate director at the IFS,and an author of the report said: ‘Officials and politicians from councils that we estimate have done well out of the business rates retention system so far, and where recent economic growth has been faster, are significantly more confident that the proposed 100% rates retention scheme would benefit their council.

‘This is perhaps unsurprising. But such confidence may be misplaced. Other research shows that over the period 2008 to 2015, at least, there was remarkably little link between local economic growth and increases in the business rates tax base. In other words rapid economic growth does not guarantee good business rates performance, and vice versa.’

For a piece by the IFS' David Phillips and analysis from The MJ's Mike Burton visit The MJ (£).