More than half of council chief executives (56%) said the fear facing financial crisis within the next year, a new survey has revealed.

PwC’s annual Local State We’re In survey revealed that only 13% of chief executives felt they could maintain delivery of essential services until the end of this Parliament under the burden of austerity.

The consultancy firm also warned of ‘devolution fatigue’ after the survey revealed optimism about the sector grasping more powers from Whitehall had waned from 33% to just 20% since the general election last year.

Although seven in 10 believed they would be part of a combined authority by 2020, just over one in three thought it would have an elected mayor.

The survey revealed almost all (94%) chief executives and leaders thought devolution of skills was essential. However, there was a gap between ambition and capacity, with just three-quarters believing they could actually deliver a devolved skills agenda.

Jonathan House, PwC’s local government partner for the north, warned that if councils took a passive approach to integration then any structural changes would be directed by the health sector.

The vast majority of chiefs felt further integration of health and social care would have a positive impact on outcomes and 60% said devolution was a part of their integration strategy.

However, a mere third believed integration would deliver savings for their authority.