- Conference
- 2024 National Delegate Conference
- Date
- 26 February 2024
- Decision
- Carried as Amended
Conference is appalled at the ongoing funding crisis in local government, which is now resulting in an existential threat to the future of many councils across the UK. Extensive UNISON research from last autumn revealed that councils across the UK were facing a funding shortfall of £3.56billion in 2024/25 and a cumulative funding gap of just over £7billion for 2025/26. On a regional basis, Scottish councils collectively faced the largest funding gap per head of population at £121, followed by Cymru/Wales at £112 per person.
A combination of extreme levels of funding cuts from central government and growing demand for a range of services are the heart of this seemingly never-ending crisis. Well over 30 councils from across England, Wales and Scotland have indicated that they are getting worryingly close to declaring effective bankruptcy. This is on top of the growing number of councils that have recently issued section 114 such as Nottingham and Birmingham.
According to the Institute for Government, local council ‘spending power’ in England, the amount of money authorities have available to spend from government grants, council tax and business rates, fell by 17.5 percent between 2009/10 and 2019/20, before partially recovering. However, in 2021/22 it was still 10.2 percent below 2009/10 levels. The fall in spending power is largely because of reductions in central government grants. These grants were cut by 40 percent in real terms between 2009/10 and 2019/20, from £46.5billion to £28.0billion (2023/24 prices). This downward trend was reversed in 2020/21 and 2021/22 as central government made more grant funding available to local government in response to the pressures of the pandemic. Even including Covid grants, the fall in grant income was still 21 percent in real terms between 2009/10 and 2021/22; without, the fall was 31 percent.
A number of councils have highlighted that they are likely to join councils like Birmingham and Nottingham in issuing section 114 notices: including Somerset, Bournemouth, Christchurch and Poole, Bradford, Middlesbrough, Oxfordshire, Hampshire and Durham. A new piece of analysis by Grant Thornton has said that 20 percent of councils are at risk of financial failure within 12 months without additional income or more spending cuts. That figure increases to 25% by the end of next year and rises to 40 percent of all councils within the next 5 years. Well over 30 councils from across England, Wales and Scotland have indicated that they are getting worryingly close to declaring effective bankruptcy.
The government has powers to introduce Commissioners into Local Authorities that issue Section 114. Such Commissioners can take decision making authority or under the threat of doing so enforce savage cuts in local authority spending.
In Birmingham eight Commissioners were appointed for five years and are paid £1,100 a day (the Lead Commissioner £1,200) for a minimum of three days per week, plus expenses such hotel accommodation. All paid for by Birmingham city Council.
Under pressure from the Commissioners Birmingham Council agreed to cuts of over £300 million over two years slashing Adult and Children Services, Youth Services, Libraries and Homeless Services and other services to vulnerable citizens. These cuts include nearly 850 redundancies and deleting hundreds more of vacant posts.
The cuts will also impact on the Health Service and the Community and Voluntary sector putting them under greater pressure.
Conference calls on the National Executive to:
1)Campaign strongly for proper recognition of local government services, calling for the investment needed to provide services and safeguard jobs, an end to the austerity politics which cause cuts to services, job and pay, and for local government funding to be significantly increased alongside a fairer system for distributing the funds and longer term settlements;
2)Generate a range of political activity in parliaments across the UK calling for more funding for council services, working with Labour Link to impress upon the need for any future Labour Government in Westminster to look to rebuild the important range of public services that councils provide back towards 2010 levels;
3)Campaign against using Commissioner’s to replace decision making by local councils;
4)Organise a national demonstration in London on a Saturday in the autumn of 2024 to call for fair and restored funding for local government.
