William Eichler 13 October 2016

London boroughs facing £2bn funding gap

London boroughs are facing a ‘huge’ £2bn hole in their finances due to cuts in central Government funding.

London Councils, which represents all 32 boroughs and the City of London, has warned current funding levels are ‘unsustainable’

As part of its submission ahead of this year’s Autumn Statement, the group said boroughs in the capital face the biggest reduction in ‘core spending power’ of all regions.

London Councils also warned some boroughs are spending more than 70% of their budgets on social care.

Population growth across all age groups in the capital will increase the pressure on services, they added.

‘The current four-year funding settlement for London does not take into account large levels of population growth – meaning it’s even tougher on boroughs than it first appears,’ said Cllr Claire Kober OBE, chair of London Councils.

‘Even with the assumption that all boroughs will raise council tax, which is unlikely, the scale of these funding cuts coupled with inflation and a rise in demand for services means London will be facing a funding gap of £2bn in 2020. ’

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