The future of local authority services is under threat from a growing funding crisis, says new report

TUC Congress HouseThe future of local authority services is under threat from a growing funding crisis, with significant cuts already being made to statutory adult care and children’s services, says new analysis published today by the TUC and the Centre for Local Economic Strategies (CLES).

The report Austerity Uncovered looks at the impacts of austerity, focusing upon how changes in publicly-funded services affect both people and places across the country, now and in the years to come.

The report, commissioned by the TUC, shows that the government’s austerity plans have considerably increased in scale, with cuts extending well into the next parliament.

The report shows that:

·   Changes to the government’s deficit reduction programme since it was first announced in June 2010 mean that we are now only half way through a nine year programme of austerity, when we should have been three quarters of the way through a six year programme. The government’s original proposals expected austerity to amount to 6.7 per cent of GDP. This is now expected to reach 10.3 per cent, increasing in cash terms from £120bn to £210bn.

·   By 2015–16 the government will have reduced its funding to local authorities by an estimated 37 per cent. A significant funding gap is emerging within local government as a result of this. The total funding gap is forecast to increase at an average rate of £2.1bn per year until 2019–20 when it will reach £12.4bn.

·   The total budget put aside for means-tested social care by English councils in 2014–15 stands at £13.68bn – a real terms cut of 12 per cent since 2010, while demand has risen 14 per cent in the same period.

·   Cuts have had a major impact on service provision. In the area of adult social care, 87 per cent of councils now only provide assistance in cases of ‘substantial’ or ‘critical’ need, compared to 47 per cent in 2005–06. There has been a 27 per cent reduction in the number of older people receiving publicly funded social care since 2008–09 and a 17 per cent decrease in the number of younger people with disabilities.

·   Even though children’s services have been largely protected to date, there have still been funding cuts of over 4 per cent. Between 2010 and 2013, spending on children’s centres fell by 28 per cent with 580 of the centres having closed as a result of local authority cuts.

·   The public sector workforce stood at 5.7 million in mid-2013, constituting 20 per cent of total employment – this was the lowest share of employment for four decades. The Office for Budget Responsibility forecasts that by 2019–20 there will be 1.1 million less public sector jobs when compared with 2010–11.

The report looks at changes in service provision resulting from cuts in nine local case studies across England (Bedford, Blackpool, Bradford, Derby, Devon, Dudley, Islington, Reading, and Redcar and Cleveland).

Stark regional disparities have emerged as a result of the spending cuts. The analysis shows that the situation for authorities with higher levels of deprivation is particularly dire. For example in the North East, 11 out of 12 councils are encountering higher than average spending reductions – 3.9 per cent compared to 2.9 per cent.

Austerity Uncovered identifies a number of common themes emerging from the nine local case studies. These include: a marked move away from the principle of universal services, with increased use of rationing, targeting and thresholds; significant cutbacks in adult care, particularly home care; and increasing levels of outsourcing of services in some cases. However, there were also significant differences in approach taken by councils in response to the cuts, with some examples of local authorities working with unions, other partners and communities in order to protect services and inform spending decisions.

TUC general secretary Frances O’Grady said: “This government is taking a sledgehammer to public services and local government.

“Adult social care is in crisis and children’s services are under increasing attack. With cuts on this scale it will be impossible to protect local services. The tragedy is that the cuts have been disproportionate – those local authorities with the greatest need have been the worst hit.”

The report makes a number of recommendations on how to mitigate the impacts of austerity. These include: a needs-based approach to funding settlements that take into account places with higher levels of social and economic deprivation; further devolution of resources and decision-making powers at the local level; develop a long-term plan for increasing funding for adult social care; a high-level commitment to improve child wellbeing and reduce inequalities; more intelligent commissioning of services that promote the living wage and reduce the use of zero-hours contracts; and more collaboration with public service unions and community groups to encourage local strategies and solutions.

CLES Chief Executive Neil McInroy said: “This report outlines the wide range of impacts on people and communities. The scale and depth of the austerity cuts are harming both our present and future.

“We need to get the priorities right and appreciate that austerity means people’s needs are no longer being met like they should be. Without considered decisions based on the needs of people and places, now and into the future, we risk causing irreversible damage.”


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Tim Lezard

Campaigning journalist, editor of @Union_NewsUK, NUJ exec member; lover of cricket, football, cycling, theatre and dodgy punk bands

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