‘Breaking point’ cuts hit councils

Another round of spending cuts announced by Communities Secretary Mr Pickles sees almost unworkable cuts hit many authorities.

In Leeds the cut was worth at least £15m and Doncaster saw nearly £8m axed.

The cuts figure is almost certain to rise in the coming days, as the Communities Secretary insists on releasing only an initial “spending power” change in which the blow is softened by including other departments’ cash, such as local NHS funds.

In North Yorkshire, county council officials say Government figures were “highly misleading” after Whitehall initially suggested there was a £4m bonus to the county. When NHS budgets are discounted the council actually faces a £21m loss.

In Sheffield officials went over their full figure to find a £44.7m cut, more than double the amount the Government listed in its spending powers statement.

Announcing the settlement in the House of Commons, Local Government minister Kris Hopkins said that the reduction would leave councils with “considerable total spending power”.

The 1.8 per cent cut – first pencilled in last year – was lower than in 2014/15 and one of the lowest since the coalition came to power in 2010, said Mr Hopkins. No council will face a loss in spending power of more than 6.4 per cent.

Mr Hopkins described the settlement as “fair for all parts of the country, whether North or South, urban or rural”.

The bulk of local authorities’ spending power comes from grants from central government, with around a quarter raised from council tax. Warnings have already been sounded over the difficulty in carrying out a fifth round of annual cuts.

Graeme McDonald, director of the Society of Local Authority Chief Executives and Senior Managers (SOLACE), said: “This settlement reminds us that the financial challenge facing local government is immense. Cuts of up to 6.4 per cent will push some authorities to breaking point.

“Government is beginning to recognise that councils have led the way on deficit reduction, but with cuts and demand increasing, fragility is beginning to show. The financial future of local services is unsustainable without a more ambitious plan for public service reform.”

The Local Government Association said that the provisional finance settlement for 2015/16 amounted to an 8.8 per cent cut in core central Government funding, bringing to 40 per cent the total reduction in support since the coalition came to power in 2010.

Over this period, town halls have been required to make savings totalling £20bn.

Wakefield Council leader Peter Box, whose authority loses £5.6m, said that further funding cuts for local government could spell the end of some of the public services on which people depend.

“Our cut in funding from Government has been more than 40 per cent since 2011/12.

“We are already facing cuts of £38m next year – we cannot absorb further cuts in spending without this having a significant and noticeable impact on the services we provide to the public.”

The Department for Communities and Local Government said it “does not recognise” the 8.8 per cent figure, but declined to give its own numbers for the scale of reduction in central grants.

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