An article by Jonathan Carr-West, a Director at the Local Government Information Unit (LGIU), published on the LSE blog on 8 October goes to the core at the outset: 'Is local government heading for broke? The scale and speed of budget cuts mean that councils do not have the time and space to ensure permanent and sustainable reductions in cost.'
http://blogs.lse.ac.uk/politicsandpolicy/archives/36972
In the latter part of last year the Audit Commission concluded that a third of Unitary and County Councils were at medium term risk of being unable to balance budgets. In the period since, with further and deeper cuts announced, that number is now doubtless a ‘conservative’ estimate. The LGA has stated to government ministers that 84 councils in England and Wales are now at the point of being financially unviable.
This is not just hot air floating political balloons into the Westminster-centric media smog.
On 4 October Liverpool Mayor, Joe Anderson, announced that detailed budget projections based on central government funding cuts that are already announced show Liverpool will have no money available for anything but fully mandatory services by 2017. And even then the Council is forecasting a deficit in the funding needed to fully deliver those mandatory services.
So why is this happening?
The answer is quite simple. The original average of 28% cut to councils’ central government funding was the stand-out measure of the entire 2010 Comprehensive Spending Review. On its own that was sufficient to raise shivers. But for many upper tier authorities it will play out as an actual real term cut of nearer 50% due to subsequent announcements and the punitive one year ‘settlement’ announced for 2015/16.
In a demographic sense it is mainly upper tier authorities, mainly in those areas with high social need and lower Council Tax property values, which are being carpet-bombed by the blunt one-size-shrinks-all cuts and distribution mechanisms. This is why the impact is felt most acutely mainly, but not exclusively, in the northern conurbations.
Staying with the North West, Liverpool will have seen over 50% of its entire controllable budget gone by 2017. The combined budget cut to the 10 Greater Manchester councils now stands at £1.2 billion since 2010 with a further £196.5 million to be cut in 2015/16.
With cuts at this scale ‘efficiency and effectiveness’ simply cannot plug the growing holes in the pail.
In a service sense it seems absolutely inevitable that many of our councils will soon be right at the edge of 'the tipping point.' Wholesale service cessation will become a reality as cut after cut after cut produces a critical mass where continuation is simply not viable. And because of the demographic distribution it is likely that the biggest impact will be in those authorities and localities that can least afford to lose universal discretionary services, have the greater community need for broad council services, and are already seeing an increase in demand for many services as a direct consequence of the public sector spending cuts.
This also skittles into the Public Sector Reform (PSR) agenda. Local Councils are clearly the ‘primary partner’ when it comes to redesigning services around concepts of life-cycle, place, community, family or individual. This is partly a product of their authority-wide remit, duties and powers across the social, economic and environmental spectrum of the administrative area. Where PSR is concerned with integrating access to, and the experience of, services that cover complex and inter-related social, cultural and behavioural factors we are also looking at some outcomes that will take half a generation to properly assess. That requires pump-prime funding and stability.
Local authorities have greater devolution of action, in a theoretical and statutory sense, than many other public services which are effectively governed directly from a Department of State. But much of the freedoms that local councils should enjoy have been hamstrung by successive governments for 30 years through central frameworks often couched in double-speak and tightened purse strings. In the current and coming maelstrom of council funding cuts any glimmer of real ‘localism’ is being kneecapped. Many of the services that could be key to successfully delivering a genuine and accountable PSR outcome are fragmented and fragmenting through outsourcing, being chopped to the bone or on the list for consideration of stopping altogether. The notion that integrated, accountable and responsive services across a broad coalition of public services can be achieved through commissioning-only enabling models is risible.
But the centrality of local councils to their communities and to an accountable PSR is also part product of the intrinsic democratic nature of local government. Derived from the well-established but all-too-often-taken-for-granted foundation of local people electing local representatives to form a body which is accountable individually and collectively to its constituents. When it comes to the way local government is represented, or more often misrepresented, this basic principle of local democratic governance and accountability is often overlooked or even derided. And whilst no system is perfect it is this basic connection between people and public body that sets local government apart from virtually all other public services.
Aside of losing vital services in themselves it is the keystone of local democracy that is under direct attack from the coalition’s cuts programme. Within the LGA and other sector based or linked bodies and organisations there is consensus that a new settlement is urgently required for local government. That is something that all trade unionists should be adding their voices to, without being drawn into nimby arguments. It reinforces our consistent message the cuts are entirely unnecessary and, from an economic perspective, have failed to deliver the stated aim of significantly reduced national debt over the course of this Parliament. The opposite is true, with debt as a proportion of GDP higher now than it was PA (pre-austerity) and set to keep rising.
Beyond a new settlement between the sector and the centre there is also a pressing need to amend funding distribution. We cannot continue with schemes that effectively take from ‘poorer’ councils and give to ‘wealthier’ councils. That in the main are transferring precious resources from the north to the south.
Without a new settlement and without redistribution local government service diminution is heading beyond the Graph of Doom orbit, and local democracy as a principle and a right will be consigned to a time capsule.