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Councils in England have warned they could be forced to reduce services and implement tax rises for the upcoming financial year as they criticised the level of funding provided by central government.
The Department for Levelling Up, Housing and Communities (DLUHC) has announced that funding available to councils will rise to more than £64bn next year, up from £59.7bn in 2023/24.
It said the councils will receive a minimum 3% uplift in core spending power – the amount councils have to spend from a combination of government grants, council tax and business rates.
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But councils across the country have already warned that the settlement does not go far enough to help councils who are facing bankruptcy due to increasing cost and demand pressures.
They have called on the government to provide emergency funding to ring-fence crucial frontline services.
Councils struggling across the country
Since 2020, seven councils have issued at least one Section 114 notice, which means that all new spending – with the exception of protecting vulnerable people and statutory services – must stop immediately.
Last week Cheshire East Council warned it could be forced to declare bankruptcy after it spent £11m preparing for HS2 before the government’s “devastating” decision to cancel the northern leg in October.
It follows Nottingham Council issuing a Section 114 notice last month, with its chief financial officer warning it wasn’t able to deliver a balanced budget for this year, which is a legal requirement.
Birmingham City Council also issued its own 114 notice in September after being hit with a £760m bill to settle equal pay claims.
In its provisional local government finance settlement for 2024-25, the government said it was “making available £1bn in additional grant funding” for social care for the upcoming financial year, compared with 2023-24.
It said councils will be able to increase council tax by…
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