English councils face a funding gap of £4bn over the next two years, new Local Government Association research has found.
The shortfall has increased by £1bn since the LGA'S analysis in July as it now accounts for the Bank of England’s August inflation forecast.
By 2024-25 the cost of delivering council services will have gone up by £15bn in the three years since 2021-22, the LGA also found.
Chair of the LGA’s resources board, Pete Marland, said: ‘Councils remain firmly in the eye of the inflationary storm and severe funding and demand pressures mean that council finances are under pressure like never before.
‘The easy savings have long since gone. Councils are being faced with tough decisions about cutting valued services, increasing council tax and fees and charges during a cost-of-living crisis.’
In its submission to the chancellor ahead of the Autumn Statement, the LGA said immediate funding is required for councils to deliver on their 2023-24 budgets, and warned that council tax hikes and the use of financial reserves were not long-term solutions.
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