Laura Sharman 06 October 2022

One in six councils at risk of running out of money next year

One in six councils at risk of running out of money next year image
Image: Lance Bellers / Shutterstock.com

One in six councils in England could run out of money as early as next year without further budget cuts or additional income, new research has warned today.

Research from Grant Thornton shows English councils face a £7.3bn financial black hole by 2025/26. This is an increase of £4.6bn since the beginning of the year, according to the data.

It warns that without additional income, councils will be forced to make savings of over £125 per head of population by 2025/26.

Phillip Woolley, head of public services consulting at Grant Thornton UK LLP, said: ‘Our research shows, the additional Covid-19 funding - while critical to support immediate challenges - has not addressed underlying systemic issues or the precariousness of councils’ financial sustainability in the face of economic instability.

’Local authorities are also now facing the risk of interest rate rises increasing debt financing costs and the real risk of reduced funding from central government, in response to the current economic turmoil facing the country.’

This week it was revealed Kent CC faces a budget gap of more than £50m by June – enough to wipe out 50% of its total reserves if not reduced.

SIGN UP
For your free daily news bulletin
Highways jobs

Corporate Director, Children and Young People (DCS)

Herefordshire Council
£142,952 (pay award pending)
We are now seeking our next permanent Corporate Director of Children and Young People to drive forward the services and deliver lasting impact. Herefordshire
Recuriter: Herefordshire Council

Senior Legal Assistant

Royal Borough of Greenwich
£39855 - £42324 per annum
Royal Borough of Greenwich
Recuriter: Royal Borough of Greenwich

Domestic Assistant

Essex County Council
Up to £25081.00 per annum + 26 Days Leave & Local Gov Pension
Domestic AssistantPermanent, Full Time£25,081 per annumLocation
Recuriter: Essex County Council

Estates Manager

Essex County Council
£47250.0000 - £55589.0000 per annum
Estates ManagerPermanent, Full Time£47,250 to £55,589 per annumLocation
Recuriter: Essex County Council

Senior Practitioner - Children in Care, North Essex

Essex County Council
Up to £0.0000 per annum
Senior Practitioner - Children in Care, North EssexFixed Term, Full Time£45,217 to £54,395 per annumLocation
Recuriter: Essex County Council
Linkedin Banner