William Eichler 09 May 2018

London boroughs ‘hard hit’ by austerity, think tank says

London’s boroughs have been ‘hard hit’ by Government cuts, a new analysis shows, with council spending in the capital falling by nearly a fifth in seven years.

New research by the think tank Centre for London has found that council spending in the capital saw a 19% fall in budgeted expenditure (per head) between 2010/11 and 2017/18.

This does not include education, public health and policing.

Inner London authorities have been hit the hardest by the decrease, the think tank said. The largest falls occurred in Newham (-33%), followed by Westminster and Camden (both -29%).

Labour councils, on average, still spend more per head compared to Conservative and Liberal Democrat-run councils or those with no overall control.

However, Labour councils have seen larger proportional drops in service budgets which have reduced this gap. The average per capita spending between boroughs run by the two main parties has gone from £273 in 2010, to £130 in 2015, and £92 in 2017. 

Resources have primarily been focused on statutory services. These have seen the smallest falls in expenditure per person, dropping only 2.8% and 10.6% respectively.

In 2017/18, according to Centre for London’s findings, which were published in The London Intelligence, adult and child social care accounted for 62% of total spending, compared to 54% just seven years earlier. 

Planning and development budgets have been hit particularly hard. They have been cut by 55%. Cultural activities, such as recreation and sport, have been reduced by 44% and highways and transport by 38%.

‘Newly elected London councillors are this week arriving at town halls that have been on the front line of austerity,’ said Richard Brown, research director at Centre for London.

‘London boroughs, like other metropolitan authorities, have been hard hit by spending cuts, with the result that delivering on manifesto promises — especially on increasing the supply of affordable housing — may be challenging.   

‘Until now, councils have shown ingenuity in finding efficiencies and protecting statutory services, but they are running out of road. Continuing austerity is likely to force some harsh choices in the years to come.

‘Local authorities should put party politics aside, and collectively lobby for a new funding settlement, with fiscal devolution and local taxation reform, to put  London services on a sustainable footing.’

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