William Eichler 13 May 2019

London council budgets slashed 17% over last decade

London council budgets slashed 17% over last decade image

London’s local authority budgets have dropped by nearly a fifth - or 17% - per head over the last eight years, a new study has revealed.

The think tank Centre for London has analysed how council budgets and spending in the capital have changed since 2010/11.

It found that all principal service areas, with the exception of children’s social care, have seen budget reductions, with planning and development, highways and transport and cultural activity budgets facing the largest cuts.

Councils have seen an overall 17% fall in their budgeted service expenditure per head, from £879 in 2010/11 to £729 in 2018/19. This reduction, which excludes education, public health and police services, rises to almost 35% when inflation is considered.

Planning and development budgets have been cut by 59% since 2010/11 and highways and transport budgets have been cut by 54%. Cultural activities budgets have dropped by 42%.

Inner London boroughs have seen the biggest cuts, with Westminster (-32%), Newham (-30%), Tower Hamlets (-29%), Hackney (-28%), Camden (-25%) and Wandsworth (-25%) all seeing cuts of 25% per head or above.

Only two councils, Barnet (+1%) and Kensington and Chelsea (+10%), have seen increases over the last eight years.

Despite these cuts, the Centre for London did find that Government funding is beginning to ‘feed through’.

Budgeted expenditure per head over the last year increased by 2% across Greater London, from an average of £713 to £729. 20 of London’s 33 councils saw their budgets increase or stay the same.

‘London boroughs, like other urban authorities across the country, have shown great ingenuity in adapting to hard hitting cuts, but they are running out of road,’ said Silviya Barrett, research manager at Centre for London.

‘There are also concerns that the forthcoming Fair Funding Review will affect the longer-term funding allocations of those councils that have seen the biggest cuts.

‘The drive for devolution seems to be stuck. It’s time to give the UK’s distinct localities the power and resources to set local tax levels and raise their own taxes.

‘This would put service delivery back on a sustainable path, reducing the sense that local areas are competing for one ‘pot’ of funding.

‘Fiscal devolution would also ensure decisions are taken as close as possible to those they affect, enabling boroughs to better shape services to suit their own local needs and strengthen their communities.’

Cllr Peter John, chair of London Councils, said: ‘Centre for London’s analysis is yet another stark warning about the huge financial pressure councils are under.

‘Government funding for London boroughs has fallen 63% since 2010 and our overall spending power has reduced by a third.

‘Meanwhile, London’s population has grown by a million and demand for complex support for our most vulnerable residents has risen even faster.

‘Boroughs cannot deal with austerity for much longer. It is time for Government to listen to our concerns. The Spending Review later this year must seriously address the sustainability of vital local services.’

Cllr David Harvey, deputy leader of Westminster City Council, said: 'Westminster is not special, but it is different and has unique pressures on its services. More than one million people a day come through the city – to work, to visit the West End or enjoy our famous attractions. These people use services but do not pay council tax. That is significant when you consider the West End alone costs around £10m a year to clean. The system needs to recognise differences like this where they impact on any council.

'We need to have a grown up and wide-ranging conversation with the Treasury on how we finance local government and come up with a sustainable model.'

Sharpening the commercial edge image

Sharpening the commercial edge

The case for well-managed council commercial activity is one that needs to be defended if we want a mature and sustainable local state, argues Jonathan Werran.
SIGN UP
For your free daily news bulletin
Highways jobs

Principal Clinical/Counselling Psychologist

Essex County Council
Negotiable
Principal Clinical/Counselling PsychologistPermanent, Part Time£51,510 to £55,000 per annum (Pro Rata)The Divisional Based Intervention Team (D-BIT) a England, Essex, Chelmsford
Recuriter: Essex County Council

Assistant Director of Housing

Rotherham Metropolitan Borough Council
£90,205 per annum      
This is an excellent time to work within Rotherham. We are passionate about the place and the people who live, work and visit here. Rotherham, South Yorkshire
Recuriter: Rotherham Metropolitan Borough Council

Joint Assistant Director – Commissioning and Performance

Rotherham Metropolitan Borough Council
£90,205
As the Assistant Director, you will be passionate about achieving excellent performance and determined to... Rotherham, South Yorkshire
Recuriter: Rotherham Metropolitan Borough Council

Social Workers - Family Support and Protection - North Essex

Essex County Council
Negotiable
Social Workers and Senior Practitioners- Family Support and Protection - North EssexPermanent, Full Time£32,065 to £49,183 per annumLocation
Recuriter: Essex County Council

School Attendance Lead

The Royal Borough of Kensington & Chelsea Council
£44,370 - £50,964 per annum
This is a multi-layered role, in which you'll both be a trusted advisor, and you will be representative of the legal need for... Kensington and Chelsea, London (Greater)
Recuriter: The Royal Borough of Kensington & Chelsea Council

Public Property

Latest issue - Public Property News

This issue of Public Property examines how how flexible workspaces can lead the way in regeneration for local authorities, Why local authority intervention is key to successful urban regeneration schemes and if the Government’s challenge of embracing beauty is an opportunity for communities.

The March issue also takes a closer look at Blackburn with Darwen Council's first digital health hub to help people gain control over health and care services.

Register for your free digital issue