More than half of councils are planning to cut spending on services, increase commercial investments or spend their reserves to make ends meet in the year ahead, according to new research.
A report by the Local Government Information Unit (LGiU) also reveals 90% of councils are also set to increase council tax, fees or charges.
The 2023 State of Local Government Finance report found that nine in 10 are planning to increase council tax by the largest permissible amount without a referendum.
Just under one in 10 believe that financial constraints represent a threat to their capacity to fulfil their statutory duties with over 50% of councils saying they would be cutting spending on services.
Housing and homelessness were named as the top immediate pressures for council finances, followed by children’s services, education and adult social care.
LGiU chief executive Jonathan Carr-West said: ‘In the 10 years since we started this survey, we have seen consistently low confidence in the sustainability of the local government funding system but this year’s results – at just 14% of councils across England – are at an all-time low.
‘Day in and day out, councils continue to display extraordinary dedication, innovation and resilience in serving their communities but they are let down by a funding system that is not fit for purpose.’
