Laura Sharman 10 December 2021

Counties face funding shortfall of over £500m next year

Counties face funding shortfall of over £500m next year image

County councils are facing a funding gap of over £500m in 2022 resulting in council tax rises or service cuts, leaders have warned today.

New analysis by the County Councils Network shows that even if the extra £1.5bn for local government in 2022/23 is targeted at addressing pressures in adult social care, it would still leave counties with a shortfall of at least £561m next year.

The leaders of England's largest councils are calling on the Government to bring forward a greater share of the Health and Care Levy for councils earlier. It wants this levy pooled with the NHS so both sides of the health service are able to receive resource from the new tax.

Cllr Tim Oliver, chairman of the County Councils Network, said: 'For council leaders, the winter period when we must set our budgets is one of the most difficult times of the year, though the government’s funding for local government in the Spending Review is a significant boost for councils and has made the process a little easier this time.

'However, it is not the silver bullet to our funding shortfall and many of us will still face a substantive gap in their finances. We recognise that our residents will be feeling the pinch after a tough 18 months with the cost of living rising, whilst some may be facing uncertain employment prospects.

'County residents already pay the highest rates and those county leaders that do propose rises of the maximum permitted will be doing so as they have little choice other than to substantively reduce local services.'

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