Budget deficits among local authorities in the UK are at record highs. Predicted deficits for 2024/25 are up 60% from 2022/23. Research from the BBC’s Shared Data Unit has found that council leaders expect to be £5.2bn short by April 2026 even after making £2.5bn of planned cuts.
Meanwhile, the government is to force many local government bodies to publish overdue accounts in order to clear a seven-year backlog, the FT reports. Over 500 councils’ and other public bodies’ 500 overdue accounts will have to be published by September 2024 even if external auditors are unable to give them a clean bill of health. The Financial Reporting Council says it will drop its inspections of auditors’ work for years up to and including 2021-22.
According to the Public Accounts Committee of the House of Commons, funding declined by nearly a third between 2010 and 2021, meaning council income was £8.4bn lower in real terms than a decade before.
BBC analysis questions some investment decisions made by councils. However, it points out that the pressure that inflation has put on budgets is prompting a wider call for a rethink of the way local government is funded ‘to break what seems to be a cycle of pressure on the services on which so many people rely’.