For many, the end of the year is a time earmarked for evaluating finances, budget-setting and forecasting. This year, many local authorities are doing these calculations and finding gaps that need to be filled.
The Department for Levelling Up, Housing and Communities (DLUHC) recently held a committee meeting focused on financial distress in local authorities. The rising incidents of section 114 notices being issued was raised. Seven local authorities have issued a s114 notice in the last three years and other councils have warned they may be forced to follow suit.
Several reasons were presented, but the overriding consensus from those giving evidence was the current model of local authority funding is broken and cannot continue. Their message was: local government has experienced huge funding cuts since 2010 and is chronically underfunded. But the demand for services has skyrocketed. This is a system that is no longer sustainable.
The Chartered Institute of Public Finance and Accountancy (CIPFA) has been hearing this message from its members for a number of years and supports a call to action. Fundamental reform will require a cross-party initiative. CIPFA’s current work, including reform of public services and research on prevention, leans heavily on a change of thinking.
But it is not just local authorities facing tough times. CIPFA’s Performance Tracker for 2023 was published recently and its findings are extremely worrying.
Eight out of the nine public services featured in the report performed worse in 2023 than they did on the eve of the pandemic.
Whoever takes the keys to No10 next year will face tough choices when it comes to public services. If the next Government sticks to current commitments, performance in services will deteriorate further. I only hope the Performance Tracker can act as a roadmap to building better and more resilient services for all.
Rob Whiteman CBE is chief executive of the Chartered Institute of Public Finance and Accountancy
X – @RobWhiteman
