General election 2024: Local services could face breaking point without long-term funding and ‘fundamental’ reform

The County Councils Network (CCN) has called on the next government to urgently set out how it will fund local authorities and reform council services once in office, warning that local services could face a ‘breaking point’ with county authorities facing a £2bn funding black hole over the next two years.

Ahead of the general election, the network – which represents England’s largest councils – has today  launched its Manifesto for Counties. It is a blueprint for sustainable county and unitary councils and better local services for residents, but the manifesto warns that the incoming government will inherit a situation with council finances ‘extremely precarious’.

But the CCN argues, however, that additional funding alone will not ensure councils are sustainable in the future. It says the government must set out a ‘bold and brave’ package of reform in local services that face the biggest financial and demand pressures, alongside extra funding.

With these 37 county authorities facing a £2bn funding gap over the next two years, and predictions of a post-election squeeze on non-protected government departments whoever wins power, the CCN warns warns that even well-managed authorities of all shapes, sizes and political control could reach breaking point.

With 68% of the average county authority budget consumed by adult social care and children’s services, councils warn this figure will only grow if there is no uplift in funds in the forthcoming Spending Review. If this is the case, local authorities will have no alternative but to have an honest discussion with government and carefully consider what services can reasonably be delivered above the statutory minimum.

The CCN’s Manifesto for Counties calls on the next government to set out increased and long-term funding for councils in its forthcoming Spending Review. But this must be coupled with reform in the services that are under the most pressure currently.

The 37 county and unitary councils in England overspent on their children’s services budgets by £360m last year, with demand showing no signs of abating. The number of children in care in county areas has increased by 12% since 2019 – higher than anywhere else – and costs of delivering school transport for special educational needs pupils have doubled to £800m in the same timeframe.

The CCN’s Manifesto for Counties calls on the next government to set out ambitious and wide-ranging reforms across the main local authority service areas, including:

• Multi-year and sustainable funding. The Spending Review for 2025/26 and beyond must retain all existing funding streams and set out a minimum four-year funding settlement for councils, including a significant uplift in funding for councils over the parliament.
• Introducing price caps in the children’s services residential care market. The  next government must consider price caps to address costs that are spiralling out of control for residential placements for children requiring local authority care, and to limit excess profiteering from private providers.
• Reforming and rebalancing the special educational needs and disabilities (SEND) system. The next government should set out a comprehensive reform programme to the SEND system, supporting and resourcing local authorities to address the fundamental challenges in increasing demand for special schools by making mainstream education more inclusive.
• Delivering a more sustainable and fairer school transport system: The next government should consider a host of reforms to school transport for pupils with SEND, including clearer guidance that tribunals can only rule once local authority travel costs are considered, moves to encourage greater independence where appropriate, and the consideration of a national means-testing policy.
• Extending and deepening economic devolution. To give county authorities as many tools as possible to boost economic productivity and prosperity, with proposals to radically increase the scope of powers available in devolution deals, including over skills and employment, bolstered powers in planning, and greater fiscal devolution..

In a cross-party County Councils Network statement, the leaders of the organisation’s Conservative, Labour, Liberal Democrat and Independent groups, said:

“Council services in county areas enhance the lives of 26m people, yet those councils face a funding black hole of £2bn over the next two years. Whoever wins power, the next government inherits a situation with council finances that are extremely precarious.

“Without extra funding and fundamental reform, highly valued local services could reach breaking point, and even well-run local authorities could struggle to balance the books. The next government must urgently set out how it will fund councils once in office, while also adopting our bold and brave agenda for reform.

“Our cross-party Manifesto for Counties does not simply make blank cheque arguments. The council services under the most pressure will only become sustainable in the future if they are coupled with root and branch reform. Councils want to be key partners in this process: setting out solutions and then leading on implementing reform across a host of areas, such as children’s services, SEND provision, and school transport.

“With the public finances tight and non-protected government departments potentially facing a real-terms reduction, it is vital that all political parties focus on securing long-term growth. Our manifesto sets out how to empower county authorities through new economic powers and devolved funding streams so they can create the prosperity of the future to help fund local public services in the long-term.”

This statement is voiced by:

• Cllr Tim Oliver, CCN Chairman
• Cllr Barry Lewis, CCN Conservative Vice-Chair
• Cllr Sam Corcoran, CCN Labour Vice-Chair
• Cllr Jerry Roodhouse, CCN Liberal Democrat Vice-Chair
• Cllr Julian German, CCN Independent Vice-Chair

Notes to editor

• The County Councils Network (CCN) is the national voice for England’s county councils. It represents 20 county councils and 17 county unitary authorities. Collectively, they represent 25 million people, or 47% of the country’s population. Read more here.