Local councils face £2 billion funding shortfall
Local councils across England and Wales may have to cut key services including social care, as they face a £2 billion or more shortfall as price rises outstrip core funding. The Local Government Association (LGA), which begins its annual conference in Bournemouth today, estimates that councils face a £2 billion funding gap in 2023-4 and £900 million the following year, even if inflation falls in line with forecasts to 2.9 per cent by the end of this year. Pete Marland, chair of the LGA’s resources board, told the FT that “fundamental” services could be cut as councils meet a legal duty to balance the books. “We are in an endgame,” he said. Two councils – Thurrock in Essex and Woking in Surrey – effectively declared bankruptcy recently after risky investment strategies left them with record deficits of £500 million and £1.2 billion respectively.
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