New research has forecast a £54bn funding shortfall facing England’s local authorities over the next five years.
The analysis by the County Councils Network (CCN) also found that 16 county and rural unitary authorities could be at risk of declaring effective bankruptcy in the next two years.
While annual 3% council tax rises could reduce the deficit to £38bn, the CCN argued that the Government should not rely on rises higher than this to help plug the gap.
Much of the shortfall comes from the network’s forecast of a £26bn rise in additional costs facing councils between 2022 and 2030.
It said 83% of the increase was from adult social care, children’s services, and home to school transport, warning that councils could be left providing little more than care services by the end of the Parliament.
The CCN’s spending review submission calls for a ‘substantive’ cash injection to shore up services followed by ‘deep and fundamental’ reform in children’s services, special educational needs, and adult social care.
CCN finance spokesperson Barry Lewis said: ‘This needs to happen urgently with a plan to be actioned within the next 18 months, otherwise we risk undermining the wide-ranging purpose of local government and derailing the Government’s mission-led approach to public service reform and greater devolution to councils.’
