The average local authority in the UK will face a £33million budget deficit within the next two years, according to new research – a 60 percent increase from two years ago.
The BBC Shared Data Unit survey of 190 councils found an extra £5.2billion will be needed nationwide to break even by the 2025 to 2026 financial year.
This comes in spite of widespread council tax rises this year – which three-quarters of those analysed did by five percent or more – resulting in a scramble for savings. Town Halls have planned to make £2.5billion in cuts this financial year alone.
Trade union UNISON has warned some councils will soon be unable to provide the most basic of services as their finances are “in the direst of states.”
Thurrock Council in Essex has the largest predicted budget deficit of all at £521million by April 2026.
In proportional terms, however, the £339million shortfall expected in Slough is greater than anywhere else, at 237.1 percent of their 2023/24 net spend.
The two local authorities have both raised council tax by just under ten percent this year, and borrowed emergency money from central Government.
In monetary terms, they were followed by Glasgow City (£196million), Kent (£142million) and Hampshire (£132million).
Use the interactive table below to see the state of your local council’s finances.
Councillor Shaun Davies, Chair of the Local Government Association (LGA), said: “Inflation, the National Living Wage, energy costs and ongoing increasing demand for services are all adding billions of extra costs onto councils just to keep services standing still.
“Councils are having to make cutbacks to services to meet their legal duty to balance the books this year and using reserves to plug funding gaps.”
Just over 94 percent of the councils in the study budgeted to make savings this financial year.
On average, these came to £13.9million per council, a 36 percent increase since the 2021/22 financial year.
According to the BBC, Thurrock Council is reducing street cleaning, ending “non-statutory” youth work, withdrawing subsidies for three bus routes and dimming street lights as part of its drive to make up the unprecedented shortfall.
Hampshire County Council is set to make the most savings overall in the UK (£80million), followed by Surrey (£69million) and Norfolk (£60 million).
In South Gloucestershire, cuts could see black bins collected just once a month, a proposal described by the Opposition as “crazy and irresponsible”.
The largest share of savings, however, will come from adult social care services – 18 percent of the total for councils in England and Wales.
Mike Short, Head of Local Government at UNISON said social services directors warned recently that councils “probably can’t offer even the legal minimum of care support next year.”
