News

A survey conducted by Solace, the membership body for local government chief executives and other public sector professionals in the UK, has found that nearly nine in ten (87%) council Chief Executives and senior managers think that the Autumn Statement will have a negative or extremely negative impact on their residents. Asked specifically about their vulnerable residents, more than two thirds (69%) said that the Autumn Statement would have a negative or extremely negative impact. The numbers are even starker among Chief Executives alone, for whom the figure for all residents is an eye-watering 91% for all residents, and 76% for vulnerable residents.

The survey also asked about the economic ramifications of the Autumn Statement and found that three quarters (74%) of Chief Executives and senior managers saying that they expected the impact of the Autumn Statement on local businesses in their area will be negative or extremely negative.

And the funding picture is not much better. 40% of Chief Executives and senior managers thought that the Autumn Statement has made their financial positions either worse or much worse, double the number who reported a positive impact.

This comes against a backdrop of local authorities already grappling with major funding pressures. Almost four in five (78%) Chief Executives and senior managers responding to the survey said that, prior to the Autumn Statement, they were already facing either a large gap (50%) or very large gap (28%) in their budget for the fiscal year 23/241.

These funding shortfalls will have serious real-world consequences. Solace also asked their members facing a funding gap which services were likely to be cut with the top three answers being environmental services (e.g., bin collections, street cleaning, parks) named by 75% of respondents; libraries, leisure and tourism (67%); and regeneration (50%). Other service areas in line for cuts include:

• 44% – adult social care
• 38% – transport
• 37% – children’s services
• 33% – housing
• 28% – public health.

According to the Institute for Fiscal Studies, the local government funding gap for 2023/24 stands at £3.4 billion and was forecast to be £4.5 billion in 2024/25 prior to the Autumn Statement.

Patrick Melia, Solace spokesperson for finance and Chief Executive and Sunderland City Council, said: “This survey makes for alarming reading. It is clear that our members in councils across the country were already grappling with hugely challenging financial pressures, in part due to the huge increases in the cost of all manner of core goods and services, as well as the ongoing increased demand for services, amounting to a real terms funding shortfall into the billions across the sector. Trying to respond to these pressures through regressive council tax or use of reserves is simply not sustainable, as this survey shows.

“Clearly these are difficult times for our country and for our residents. And while the additional funding announced yesterday for adult social care is welcome and will help to alleviate that specific pressure, it remains insufficient. We are seeing now the consequences of local government being underfunded for many years.

“The upshot is that basic service provision will inevitably suffer, with negative consequences for millions of residents. The number of councils considering cuts to children’s services, adult social care and public health are especially concerning, considering that this will inevitably hit prevention work, with knock-on increases in demand and cost for other areas of the public sector, especially the NHS, in years to come.

“And the impact on our vulnerable communities will only further be compounded by the struggles facing the voluntary and community sector, which is also grappling with both increased costs and service demand that councils are increasingly unable to provide sufficient support to deal with.

“I am also concerned that, while already in the teeth of a recession, Solace members expect the Chancellor’s announcements yesterday to weaken local economies up and down the country, and so delay recovery in the national economy.

“This is not helped by the reduction in overall capital spend, which the levelling up fund only partially addresses, which I fear will raise public expectations of investment that isn’t coming, while the basic fabric of the public realm deteriorates.

“Local government has a vital role to play in steering our communities and local economies through the multiple ongoing crises, especially as we head into recession. And we stand ready to deliver for our communities and places, as we did during the COVID-19 pandemic.

“But without the right financial support, councils will be unable to successfully fulfil those crucial roles and the nation’s recovery will be severely undermined.”

N.B. Solace surveyed their members over the 24 hours immediately following the Autumn Statement and received 174 responses, including 69 council Chief Executives, 85 Senior Directors/Managers, 14 early career and 2 who identified their job description as ‘other’.