Thursday, 8 March 2018

Financial sustainability of local authorities 2018

Financial sustainability of local authorities 2018 The financial health of local authorities across England is getting worse, says a report from the National Audit Office (NAO).

The report, published today, highlights that despite greater freedoms to increase council tax bills and one-off short-term funds from government, local authorities are struggling to juggle higher demands and cost pressures against significant central government funding cuts of nearly 50% since 2010-11.

Many local authorities are relying on using their savings to fund local services and are overspending on services, which is not financially sustainable. The report goes on to show that if local authorities with social care responsibilities keep using their reserves at current rates, one in ten could have exhausted them within three years. Last month, Northamptonshire County Council imposed strict in-year spending controls as it is at risk of spending more than the resources it has available in 2017-18, which would be unlawful.

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