Preventive services will be put at risk and councils in deprived areas forced to reduce spending by up to one-third by the government’s frontloading of council budget cuts, the sector has warned.
The Local Government Association has estimated that councils are facing, on average, an 11% cut in funds next year, compared with 6.5% in 2012-13 and 0.9% and 5.6% in the two years after that.
This includes the cuts announced in the comprehensive spending review combined with the ending of those grants that have been rolled into the councils’ formula grant. Moreover, the effects of inflation are excluded.
Councils in poorer areas will be badly hit because they earn less from council tax and rely more on formula grant.
Local authorities have only about eight weeks to make budget decisions after they find out their individual allocations next month.
Kim Bromley-Derry, director of children’s services in Newham, London, said the council was looking at overall cuts of about 33%; children’s services faced funding cuts of 8-10%.
Matt Dunkley, vice-president of the Association of Directors of Children’s Services, said most councils had assumed the cuts would either be evenly distributed across the four years or backloaded to give them time to transform services.
“Given the extremely short timescale, many councils will have no option but to cut whole services, rather than transform them over a longer period, to meet the savings requirement in year one,” he said. “It means preventive services are more vulnerable because our ability is compromised to transform them and manage down demand for child protection and care services.”
He said directors were running out of time to make redundancies to achieve reductions for April 2011, given the 90-day consultation process required.
“It was already going to be challenging to meet these savings targets but not telling us the full scale of specific grant reductions and then frontloading the formula grant is like tying one hand behind our backs,” Dunkley said.
Mark Luntley, LGA programme director for finance, said most councils were locked into contracts that were difficult to break, especially in adult care.
Children’s minister Tim Loughton insisted councils could redesign services, despite the tight timescale. He pointed to Hackney’s transformed child protection structures which reduced demand and doubled the savings expected.
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