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09.08.18

Bare-bones ‘Core Offer’ could become the norm as more councils face financial doom

Plans to drastically cut back services and replace regular provision with a scaled-down ‘core offer’ of statutory services could become the new normal, leaders have warned.

The stark warning from the County Councils Network (CCN) comes on the same day as Northamptonshire councillors meet to decide on a dramatic programme of cuts as a result of starved pockets and emptied reserves.

Although the meeting is still ongoing, it is likely that members will vote to reduce services to the statutory minimum—meaning the very least that the council legally has to provide—in a bid to save £70m this financial year. If insufficient action is taken, Northamptonshire could face an economic blackhole as big as £180m by 2021.

In answer to this, the CCN has argued that a lethal mix of cash reductions from central government, rising demand, and an “unfair funding” formula could lead to a £3.2bn shortfall over the next two years, pushing more authorities over the edge and forcing others to issue section 114s as basic ‘core offers’ become the norm.

The network also said that counties are most at risk of following East Sussex’s steps to end all but essential local services in order to be able to balance the books in future years—a legal duty that all councils must abide by.

While the CCN accepted that Northamptonshire had “not managed austerity well”—with recent claims that the authority ignored important financial warnings three years ago—it said that other high-performing councils, such as East Sussex, will not be the last to set out a ‘core offer’ without extra help.

County councillors are today calling on the Treasury to “better understand the pressures” they are under, and boost local government’s short-term resources for the next financial year ahead of a long-term deal in the Spending Review.

Cllr Paul Carter, CCN’s chairman and leader of Kent County Council, noted that Northamptonshire had demonstrated clear evidence of poor management and decision-making, but argued that this “shouldn’t detract from the significant challenges facing all countries.”

“We will work hard to deliver the savings required this year, but the scope for making deliverable savings has dramatically reduced and decisions for next year will be truly unpalatable if we are to fulfil our statutory duties,” he continued.

“It is clear that unless government finds a long-term solution to council funding and a fairer distribution of resources between authorities, other well managed county councils could find themselves unable to balance the books. Only a third of county leaders are confident they will be able to set a balanced budget in 2020-21 without additional resources being announced in the Spending Review.”

Speaking to BBC News this morning, Cllr Ian Hudspeth, leader of Oxfordshire County Council, admitted that he has also made some tough financial decisions that he personally doesn’t “necessarily agree” with in the name of balancing the books.

But the Tory leader rejected claims that this local government crisis is indicative of a problem with the Conservative Party. Instead, he explained that the government has had to make “really difficult decisions” to bring down the deficit since 2010, and recognised that councils are having to do the same in order to stay within their legal duties.

“When I became leader, I thought it was important to gradually increase council tax so we didn’t end up in a situation such as Northamptonshire’s,” he told the BBC. “That’s one of the things that perhaps Northamptonshire should’ve looked at in the past.”

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