Councils spell out impact of further cuts for children in 2015/16

By 2016, parts of England will have no local authority-funded children's centres, sports facilities and voluntary organisations if the government ramps up its spending reductions.

This is the stark warning from the Local Government Association (LGA) in its submission to the Treasury on the June spending review. In addition to the four-year 28.4 per cent cut to local government funding already implemented between 2011/12 and 2014/15, Chancellor George Osborne last year added a further two per cent reduction for 2014/15. Now, LGA's members fear that when he announces the public spending parameters for 2015/16, he will extend the squeeze.

In anticipation of the announcement, the LGA has published a vision of what the future will look like for an average council if the government cuts further. Called Anycouncil and the Spending Round, it describes an imaginary council that has experienced typical funding reductions since 2010. It has mid-range levels of deprivation and growth in the local economy. The LGA suggests if the government imposes a further 10 per cent reduction for 2015/16, Anycouncil will need to save or raise £30m across all its services.

Because of ringfencing and government-imposed restrictions on spending, Anycouncil will look to non-statutory services as the only option left to cull.

Closing five children's centres, six libraries and ending all financing of sports, leisure and voluntary sector activities are included in Anycouncil's saving options.

John Merry, the LGA's vice-chair and assistant mayor for children's services at Salford City Council, says despite local authorities' desire to protect such services, non-statutory areas will provide the only options. "There comes a point where we can't actually cut any further," says Merry.

"If you take all the areas we're responsible for, such as safe­guarding - which most of us will want to protect - the more areas you ringfence, the greater the cuts in those areas that are left."

Increased unemployment
Merry says that beyond the services outlined in the report, young unemployed people will be deeply damaged by the cuts because authorities will lose their ability to support local growth. He says joint activity with government agencies and the voluntary sector will end, leading to increased youth unemployment.

"We're trying to increase apprenticeships and meet the skills deficit we have, but this is another non-statutory area of work that is unfortunately going to be targeted for savings," he says.

The Anycouncil report follows an earlier LGA submission to the Treasury in March. This report suggests one solution to the problem is to remove ringfences in children's services - particularly the schools budget, which is protected within the Dedicated Schools Grant (DSG). It asks the government to "allow schools to work with councils to use the DSG to support early intervention and early help approaches".

"The more flexibility we have, the better we can manage the services coming under us," says Merry. "Sometimes ringfencing doesn't help because it freezes a whole block of our expenditure in place where we might be able to make better savings there, and use the money to protect services that are more important. We'd like to have the funding to support early intervention rather than later activity."

Ian Thomas, chair of the ADCS resources policy committee and director of children's services at Derbyshire County Council, backs the LGA's call for more flexibility over how to use funds.

He is already concerned that unringfenced money earmarked for early intervention by local authorities is to fall from £2.3bn in 2012/13 to £1.6bn in 2014/15. He says more cuts will not only remove authorities' capacity to intervene early, but make meeting demands for councils' statutory services impossible. "It's a false economy to reduce councils' capacity to offer early intervention solutions. If you do that, you're going to have to fall back on high-cost statutory provision, such as social care," he says.

Blowing the budget
Thomas estimates that removing funding for Derbyshire's multi-agency teams, which provide non-statutory low-level support to children aged up to 19, could result in half of the 5,000 children the team currently supports needing formal care, adding £125m to the council's annual social care bill. The average care cost for a child in Derbyshire is £50,000.

"Their circumstances at home would deteriorate to such an extent that we would have a legal obligation to bring them into care," says Thomas. "The reason they're in need is because we've identified that they have additional needs, so we provide lower-level support. It would blow the whole budget to pieces."

Evidence-based programmes, such as multi-systemic therapy for adolescents on the edge of care, are another form of support Thomas fears losing as a result of further budget reductions. He says all Derbyshire's social workers are currently being retrained in systemic therapy - but that these sorts of programmes would also be threatened.

Sam Royston, policy adviser on poverty at the Children's Society, says further cuts to local authority budgets would have even more far-reaching consequences than the Anycouncil report envisages. "The services that are delivered through, or associated with, children's centres would also be threatened," says Royston. He gives the example of money advice services delivered by Citizens Advice Bureau. "This will have an impact on the community hub element of children's centres," he adds.

As a result, Royston suggests such provision will become pressured to be self-sustaining. "Over the past few years, local authorities have been removing subsidies for nurseries," he says. "In disadvantaged areas, children's centres will find it difficult to stay financially viable, which will have an impact on early education availability. It also has the potential to create a vicious cycle around employment levels in those areas," he suggests.

"Areas of high unemployment can't support the nurseries on the basis of paying. If childcare services become less available, it becomes difficult for parents to take up jobs."

At the same time as councils are dealing with funding reductions, they are taking on new respon­sibilities of localised support, says Royston. He suggests the unringfenced Social Fund, which was transferred from central government to local authorities in April, could be a source of extra revenue for councils.

"Emergency support is so crucial at the moment, but because it is a new service the temptation could be to scale that back," says Royston. Research to be published by the Children's Society in June supports this view. It finds some authorities are already keeping the money back to use elsewhere.

Increasing child poverty
Royston suggests local authorities are also increasingly providing housing support for vulnerable families because of housing benefit cuts. "I've heard that local authorities may have to dip into their central funding pots to fulfil their homelessness duties," he says. Royston adds that the consequences of removing or reducing emergency support could lead to a rise in child poverty. "It could drive families into debt. They might have to turn to very high-interest forms of credit or simply go without the basics like food and fuel."

Anne Longfield, chief executive of 4Children, is more positive about how local authorities will manage tighter finances. She suggests the fact that many children's centres have survived cuts so far shows that councils value their impact. "We're seeing them doing all they can to protect children's centres," she says.

"The message we're getting from local authorities is they're taking the good model of local support from children's centres and using it as a springboard to deliver the really essential support that disadvantaged families need."

Longfield says children's centres are increasingly providing services that address more acute issues such as domestic violence, alcohol dependency and child protection. She also says many are considering extending children's centre age ranges from birth to five up to 19.

Longfield backs the LGA's suggestion that schools could help deliver services threatened by budget cuts. Aside from freeing up funding from the DSG, she says local authorities should make better use of schools' assets. "Schools have immense resources in their buildings and we have to look at ways to maximise those," she says.

The LGA's submission warns that demand for children's services is rising. It cites Department for Education statistics that show the number of children subject to a care protection plan rose from 29,200 in 2008 to 42,850 in 2012. It argues that this will only exacerbate the need for local authorities to do more with less.

Emma Scowcroft, policy manager at Action for Children, says the charity's annual Red Book report found that the number of children's services managers reporting a rise in children's needs increased from 51 per cent in 2011 to 58 per cent in 2012, and expects another rise this year. She agrees that more cuts might prove to be the tipping point for local authorities.

"There have been genuine efforts made by local authorities to maintain vital services for vital cohorts of young people," she says. "Next year, if the trends continue, we might see services close."