Local Government Funding is broken
As we rush headlong towards the next General Election, the background murmur of lobbyists and pressure groups is growing to a gentle roar. By party conference season, prepare to be deafened by the cacophony.
This week, fallout from the report by the Institute for Fiscal Studies created more noise. The IFS conclusion – that local government funding is ‘broken’ – will come as no surprise to regular readers of The MJ.
Our current Government may claim to be committed to levelling up – tackling health inequalities and life chances – but after four years is still failing to divert sufficient funds to deprived communities.
What is surprising, however, is the report which concluded that local government funding is broken was commissioned by The Health Foundation. It is part of a snowballing shift back towards a place-based assessment of public services: the inspiration for the last Labour Government’s Total Place regime, or the current Conservative approach to integrated care.
It may be the right thing to do, but would such a policy approach be a vote winner? How often have you ever heard a politician say: ‘The message on the doorstep was clear – voters want an area-based approach to public service funding’? Unlikely.
Meanwhile, the reality of local government finance remains – large swathes of local government are underfunded, often those most in need. There are few services left to cut, no leeway on council tax, and little hope of a commercial solution.
What’s more, the deterrents for financial failure are no longer there. Resorting to a s114 notice used to equate to career suicide. Now there is safety in numbers. Fearful of Government intervention? Don’t worry, there is a long list of other authorities ahead of you in the queue.
According to finance sources, there are now up to 50 councils on the Government’s watch list. At what point does the risk of financial jeopardy stop being a watch list and start just being a list of all councils?
Local government funding is broken, promises to ‘level up’ have not yet been backed by funding commitments and there is not enough cash to go round.
As the lobbying intensifies ahead of the General Election, will politicians on both sides believe there are votes in funding local government? Maybe not. But there are votes to be lost when public services fail.
Published in the Municipal Journal 16 August 2023