The number of councils that have experienced significant failures has been increasing in the past five years. Common causes include financial pressures, poor decision-making, risky investments, a lack of commercial skills and knowledge, as well as a lack of transparency. Dysfunctional relationships between leading members and senior officers have often exacerbated those problems, whether they were collusive, combative, or simply ineffective.

It is important to remember that although many councils now consider themselves to be at risk of financial failure because of problems largely beyond their control, most councils are still managing to maintain effective governance arrangements and balance their budgets. The pain involved in achieving a balanced budget, for councils and their residents, should not be underestimated and it will not be possible for many of even the most robust councils to avoid failure in 2026-27, unless local government funding is reformed and brought into line with demands on its services. The move to a three-year funding settlement is a good step in the right direction but much more needs to be done to avert widespread failure.