Latest Public Sector News

10.11.17

Social care to cost 60% of council tax by 2020

Almost 60p in every pound of council tax could be spent on caring for children and adults by 2020, according to local councils.

Figures from the Local Government Association suggest that council budgets are becoming increasingly strained by the rising demand for adult social care and children’s services.

In 2010-11 41p of every pound of council tax was spent on these services, but the LGA predicts that this will increase by 15p per pound by 2019-20.

Consequently, the LGA says that less funding will be available for other vital services, such as waste collection, road improvements trading standards, licensing and food safety.

It warns that the money that local government has to provide such services is running out.

According to the LGA, by 2020 England’s local governments will have lost 75p out of every pound of Revenue Support Grant funding that it received from the government in 2015.

By 2019/20 almost half of all councils will no longer receive any of this core central government funding.

In addition, the government’s plans to allow councils to keep all of their business rates income by the end of the decade have been cast in doubt since the Local Government Finance Bill was not reintroduced in the Queen’s Speech.

The LGA has said that it is essential for local government to keep these business rates to "plug the growing funding gaps.”

It also argues for a fairer system to distribute funding between councils.

Councillor Claire Kober, chair of the LGA’s resources board, said: “Within two years, more than half of the council tax everyone pays could have to be spent on adult social care and children’s services.

“Councils will be asking people to pay similar levels of council tax while, at the same time, warning communities that the quality and quantity of services they enjoy could drop.”

She said that England’s local governments face a funding gap of £5.8bn by 2020.

She continued: “Even if councils stopped filling potholes, maintaining parks and open spaces, closed all children’s centres, libraries, museums, leisure centres, turned off every street light and shut all discretionary bus routes they still would not have saved enough money to plug this gap in just two years.

“An extra £1.3bn is also needed right now just to stabilise the perilously fragile care provider market.

“The government must recognise that councils cannot continue without sufficient and sustainable resources.

“Local government must be able to keep every penny of taxation raised locally to plug funding gaps and pay for the vital local services our communities rely on.

“With the right funding and powers, local government can play a vital role in supporting central government to deliver its ambitions for everyone in our country.”

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