Councils plan £900m of cuts including children's services and early years

Joe Lepper
Thursday, September 20, 2018

The worst council cuts are still to come, with more than £900m of reductions set to be made next year affecting children's services, early years, and youth services, the organisation representing county councils has warned.

A survey by the County Council Network (CCN) found that all 36 county council and county unitary authorities will be making cuts, totalling an estimated £918m - an average of £25.5m each - when they set their budgets next February.

Rising demand for children's services and adult social care are among key factors in the increasing financial difficulties county councils are facing, the organisation said.

Of the total cuts, £685m will be to balance the books in the face of rising demand, with a further £233m of unplanned cuts to frontline services needed.

The CCN also asked councils in a separate survey to identify which services are likely to see moderate to severe cuts over the next three years.

Of the 25 councils that answered, 45 per cent said early years and youth clubs would face cuts, while 36 per cent said children's services departments would see reductions.

CCN said that unless government provides new funding, councils will have no choice but to implement the cuts when they finalise their budgets next year.

"County authorities are in a serious and extremely challenging financial position," said Nick Rushton, CCN's finance spokesman and leader of Leicestershire County Council.

"The further planned funding cuts and continued escalation of costs outside of our control will make this bad situation even worse.

"I know from my experience in Leicestershire that demand for services, cost-inflation and government grant cuts will create £40m of financial pressures next year. Some of this can be mitigated by increasing council tax, but further savings will be necessary.

"County councils across the country have no choice but find a further £1bn of savings next year. Choices will be limited and reductions to frontline services inevitable: with valued services such as pothole and highway repairs, children's centres, libraries and increased charges for residents all on the agenda."

"The government needs to intervene if we are going to avoid unpalatable cutbacks next year."

This year county councils overspent on children's services by £264m, according to the CCN, with the organisation saying that preventative services are "likely to be the victim" of further cuts.

Last month Association of Directors of Children's Services president Stuart Gallimore warned that early help services for families are likely to be cut across all local authorities.

Earlier this month children's minister Nadhim Zahawi said steps are being taken to halt increases in the number of children being taken into care and that the government is "acutely aware" of the impact the situation is having on councils.

In June Office for National Statistics figures showed that council spending on children's services is rising at a faster rate than any other council area, with expenditure set to increase this year by £542m.

The Local Government Association has warned that by 2020 there will be a £2bn funding gap in children's services.

A number of councils are facing severe financial pressures. Earlier this year Northamptonshire County Council was issued with a section 114 notice, which bans new spending with the exception of safeguarding vulnerable adults and children, due to its precarious financial situation. A recovery plan put forward by the council in August said between £60m and £70m worth of savings need to be made in the current financial year.

Matt Dunkley, chair of the resources and sustainability policy committee at the Association of Directors of Children's Services, said the government's current approach to funding children's services is unsustainable.

"There is simply not enough money in the system to keep pace with the level of demand we are currently experiencing," he said.

"More children and families are reaching crisis point and the very preventative services that help keep children and families together have been cut to the bone.

"We have worked hard to innovate and reshape our services in order to make them as efficient as possible but there is no where left to go now, we are already taking money from other council services just to prop up our children's services.

"Directors of children's services are statutorily responsible for ensuring good outcomes for all children and young people in their local area but without sufficient resources from government our ability to do this is severely compromised."

A Ministry of Housing, Communities and Local Government spokesman said that the latest government funding settlement gave a real-terms increase in resources for councils in 2018/19. 

"Local authorities are responsible for their own funding decisions, but over the next two years, we are providing councils with £90.7bn to help them meet the needs of their residents," he added.

"We are giving them the power to retain the growth in business rates income and are working with local government to develop a funding system for the future based on the needs of different areas."

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