Local Authority Challenges

Joint East Midlands mayor plan would ‘consign Leicestershire to division two’

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I hear very few rural voices in the machinations linked the current moving of the deck chairs around on the Titanic in terms of the latest round of (in terms of the real challenges we face) side show that is local government reform. As someone who has lived in the “East Midlands” region all my life I would suggest that this controversy is about Nottingham, Derby and Leicester… This story tells us:

Leaders in Leicestershire have expressed anger at the region being excluded from a first of its kind devolution deal for the east Midlands, saying it will be “relegated to the second division”.

On Tuesday, plans for a groundbreaking devolution deal between Derby, Derbyshire, Nottingham and Nottinghamshire were announced, which would see the areas grouped as a Mayoral Combined County Authority (MCCA), led by one mayor, and which would receive £1.14bn funding over 30 years.

The plans are part of a new devolution model that would be introduced once the levelling up and regeneration bill is passed, and it is hoped the first mayoral elections in the region would take place in May 2024.

But some said the exclusion of Leicestershire and Leicester, the most populous urban area in the east Midlands, situated about 30 miles south of Nottingham and Derby, would harm the region in the long term.

Slough goes bankrupt after discovery of £100m ‘black hole’ in budget

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This story is about Slough but Copeland, Peterborough and Redcar and Cleveland, which feature in the story, all have significant rural components. It explains how the pressure is bearing down on many local authorities. It tells us:

Slough is the third English council to become effectively insolvent in the past three years, following Northamptonshire and Croydon, and its predicament reflects a much wider precariousness in local government. The National Audit Office warned in March at least 25 authorities were on the brink of bankruptcy.

Eight councils, including Slough, were told earlier this week they faced an independent government-commissioned review into their finances as ministers decided whether to bail them out financially. The others are Bexley, Copeland, Eastbourne, Luton, Peterborough, Redcar & Cleveland, and Wirral.

Although Slough said its finances had been hit hard by the impact of Covid – leading to a collapse in council tax and business rates income – a report by its chief financial officer, Steven Mair, made clear the problems were deep-rooted and linked to accounting errors, lax financial controls and poor decisions.

“Slough’s financial problems have not arisen in the past few months. The approach to financial decision-making, leadership and management, processes, quality assurance and review etc that has been adopted by the council over a number of years was not robust and consequently highly detrimental to the council,” Mair’s report said.

Many of the problems recently uncovered related to previous years, the report said, and had they been know about at the time it is likely that the council would have been unable to meet its legal duties to set a legally balanced budget – raising the prospect it could have been technically insolvent as early as 2019.

Councils under huge pressure as number of children in care soars

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I’m sorry so early into the new year to be running another story about services local authorities can’t fund – but stories like this and their implications for rural families can’t be ignored. This story tells us:

The number of children in care has gone up by 28% in the past decade with council leaders warning of unsustainable pressure being placed on support services for young people.

Official figures show there are now 78,150 children in care in England, up from 75,370 in 2018 and almost 20,000 more than in 2009 when 60,900 children were looked after.

The Local Government Association (LGA) warned the huge increase in demand, combined with funding shortages, is putting immense pressure on the ability of councils to support vulnerable young people who need help.

Judith Blake, the chair of the LGA’s children and young people board, said the demands being placed on councils were “unsustainable”. “These figures show the sheer scale of the unprecedented demand pressures on children’s services and the care system this decade,” she said.

Councils were forced to overspend on their children’s social care budgets by almost £800m last year in order to try and keep children safe, the LGA said. This happened despite them allocating more money than in the previous year to try to keep up with demand.

Data shows councils have experienced a 53% increase in children on child protection plans – an additional 18,160 children – in the past decade.

There has been a 139% increase in serious cases where the local authority believes a child may be suffering, or likely to suffer, significant harm, to 201,170 cases.

Ministers urged not to set care cost cap that ‘may be too high to help’

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This debate is all well and good but if something isn’t done to stop local authorities having to continue to support the cost of it- most first tier authorities will be bankrupt within the next decade methinks. This story tells us:

Ministers have been urged not to set a cap on care costs, which is so high that it fails to help almost all of those in need.

Theresa May is expected to publish a green paper on social care before Christmas, which will set out options about how to fund care of the elderly.

The vexed issue nearly cost the Conservatives the last election, when their proposals were branded a “dementia tax”.  

Under those plans, pensioners’ assets – down to the last £100,000 – would be used to fund care whether or not they were still living in their homes.

Amid a growing backlash, Mrs May last year said the deal would include a cap on costs, with no one having to pay more than £72,000.  

However, the plan was shelved, amid promises to publish a green paper – which has been repeatedly delayed – to explore the options.

Charities for the elderly raised fears that future proposals could be even worse than those which were abandoned – and could help as few as one in 20 of those in need of care.

Calculations for the Alzheimer’s Society suggest that capping total costs at £72,000 would only affect seven per cent of those who receive care.

And a higher threshold of £80,000 would mean just five per cent of pensioners receiving care would receive help, while just two per cent would get help if it rose as high as £100,000, the estimates by analysts LaingBuisson show.

The average resident of a care home spends two and a half years there, with annual costs of between £30,000 and £40,000.

The six challenges facing local councils over next 20 years

This story tells us: A new study from the Social Market Foundation (SMF) identifies and explores six changes that are likely to dramatically impact the demand for, and supply of, local public services in 2040.

It also noted these changes are occurring against the backdrop of a fall in local government employment by a quarter or 800,000 employees between 2010 and 2017, and an increase in net borrowing (£8.6bn in 2016/17).

The report warns an ageing population will put increasing pressure on social care and health services.

The pension-age population is forecast to rise by close to a third (34%) and the number of over-75s in the population is set to grow by 89%.

‘This points towards a surge in demand for health and social care services unless health in old age improves dramatically,’ the report states.

The breakdown of the nuclear family is also going to prove challenging for local authorities.

The report warns more fragmented families ‘could translate into greater demand for public services’ as care roles traditionally carried out by family members are left to the state or private providers.

The fact that family members will be more widely dispersed will also impact on housing quality and affordability.

The research also suggested increasing prosperity in the future will drive higher expectations of public service quality and convenience. It also noted growing disparities across regions and across generations where public services are concerned will ‘demand an adequate response’.

There will be ‘huge opportunities’ to apply innovations in technology and big data to improve the productivity of public services, the report states. But it cautions this will lead to disruption in jobs that will need to be managed.

Localised environmental risks around flooding and air pollution are expected to heighten, says the public service report.

Finally, greater fiscal devolution will present ‘huge opportunities’ to councils to ‘control their destiny’ as well as risks around the resilience of their local tax bases.