Laura Sharman 14 May 2020

Councils face £10bn funding 'black hole'

Councils face £10bn funding black hole image

Councils could be forced to cut billions from social care services due to £10bn 'coronavirus black hole', Labour has warned today.

The analysis, based on 2019/20 budget estimates, warns that local authorities may need to cut adult social care by £3.5bn, which could see 225,000 people lose care this year.

The funding shortfall could also means £2bn cuts to children's social care and £700m from public health budgets, Labour said.

Labour’s shadow communities and local government secretary, Steve Reed, said: 'Local authorities are the biggest funders of social care in England – so when the Government promised to stand behind councils through this crisis Labour supported them.

'But now ministers are breaking that promise, leaving councils with a £10bn black hole forcing 21% cuts across the board. Unless the Government drops those plans the frontline heroes we’re cheering today will lose their jobs tomorrow and the equivalent of 225,000 frail and frightened older people and vulnerable adults will lose the support they rely on.

'That would be a catastrophe for social care, disastrous for those who lose support as providers are forced out of business, and would once again fail the very people putting their lives on the line to get us through this crisis.'

Already cash-strapped following a decade of austerity, councils now face fighting a national crisis on a basic budget with their financial futures left in the balance. Heather Jameson reports.

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Participatory budgeting

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