The Guardian has reported today that:
“Out of control” increases in child protection spending since the outbreak of the Covid pandemic have put one in 10 of England's biggest councils at risk of effective bankruptcy in the next few months, a survey has revealed.
Many county councils and unitary authorities are “running out of road” to avoid insolvency as they grapple with high inflation, increases in children being taken into care, and massive bills for children's homes, the County Councils Network (CCN) said.
Earlier this week, they reported:
England's housing crisis will push many local authorities into bankruptcy as the increasing cost of emergency accommodation for thousands of homeless families threatens to overwhelm council budgets, leaders have warned.
The worst-hit councils are now spending millions of pounds a year – in some cases between a fifth and half of their total available financial resources – to try to cope with an unprecedented and rapid explosion in homelessness caused by rising rents and a shrinking supply of affordable properties.
To be clear, local authorities are facing the risk of financial failure because of the rapidly rising demand for and cost of:
- Housing for the homeless
- Adult social care
- Child social care
- School transport
This is not spending on fripperies: these are essential elements within the social care safety net or in the provision of universal education.
So, will the government provide the funding needed? Or will they display the indifference that they showed towards need during the Covid crisis? Given that they have no moral compass, who knows?
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I work in a Local Authority land and confirm that this is all true.
My LA has not been compensated for dealing with Covid adequately – we needed rents at 11% increase this year to cover increased costs as a result of Covid and inflation and got lower (it was going to be worse than that!).
The Housing Revenue Account (HRA) is already helping out the general fund at my LA to the point where it is eating into reserves to purchase properties for housing to put homeless families in, whom are waiting to see if we have a duty to rehouse or care leavers who need a place to live. Those reserves were going to buy us a fleet of electric vans for our housing repairs team. Not now!!!
The LAs who really are in trouble are those who may not have a HRA having privatised or sold off their council housing. There will be little room for manoeuvre at those, which makes the loss of their HRA seem now like a big mistake notwithstanding the restrictions imposed from central government.
It seems that the Tories are just intent on breaking the system – to watch it go down until it runs out of road. To bankrupt them on purpose and make out that it was all their fault.
All of this created by the people who wrote ‘Britannia Unchained’ – spoilt brats who have lived off their parents talent (or criminality) coddled in wealth they did not make who have a totally unhinged view about what life is really like for the rest of us.
Nicholas Ridley lives on unfortunately as a zombie.
So do you think it possible the councils are being deliberately undermined in order to make way for the Charter Cities/SEZs’freeports/special economic zones which so excite @EuropeanPowell and before him @bakerstherald?
I doubt it
I do not accept that agenda exists
I think that the Tory party is made up of a number of toxic vested interests that seem to overlap.
Those who are just ideologically opposed to the State in any form; those who believe that the state help is a ‘moral risk’; those who see the state as crowding out opportunities to make money/markets; those who honestly believe the state has money of its own and as I said those who have no idea how real people live.
Throw in the largesse of the rich and some academics who believe these things as well and this is what we’ve got.
Systematic underfunding leading to increased central control and privatisation (the same technique as with the NHS).
Blame local ‘incompetence’, public officials and local government who ‘mismanaged’ when obligations aren’t met; move in with yet more PPP/PFI/suchlike and centralised restrictions on application of funds; plus increased use of the appalling competitive bid process that’s already used for Active Travel and other development funds for renewal and regeneration, where LAs fight each other in a zero sum game. “Demonstrate the best management plan for filling potholes” and Westminster will grant you some extra cash (or maybe offer to underwrite your risks in the PPP/PFI deal with some contractor)?
I so agree on the bid process
Can anyone tell me why local authorities don’t unite to demand more money from the Government? I know the “because they’ll take us over” argument, but realistically they couldn’t, if LAs acted together. Instead, LAs seem to take great pride in making the cuts which destroy our local services, and want to be patted on the head for having done a good job.
But they do argue all of the time.
I think that we argued for higher rents for social housing to meet inflation and Covid costs – I think we got something between 6-8% but not the 11% that most LAs asked for.
Since 2010 BTW, there have been periods of below inflation rent rises in social housing. Government has to be careful because since 2012, all HRAs have been self financing and below inflation rent rises will have a deleterious effect on HRAs that are supposedly under local control.
….”homelessness caused by rising rents and a shrinking supply of affordable properties.”….This is the core of the problem, not enough affordable new housing being built. The high cost of housing is the main cause of in-work poverty. The Tories won’t build hundreds of thousands of new affordable homes because this might collapse house prices & the tenants will mostly vote Labour. Whether a new Labour Govt from 2024 can fund the £60Bn a year to build 1.5 million new affordable homes over 5 years remains to be seen?
It could, easily
The question is not capacity but willingness
This situation has been deliberately created by the government with reduced funding for local authorities. We will see the demise of many councils and their replacement with privately-owned and controlled, Charter Cities/ SEZ
No we won’t