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04/02/2019 23:30 GMT | Updated 05/02/2019 09:25 GMT

What It’s Like To Slash Millions From Council Budgets: Local Authority Leaders Speak Out

'There is no money' say town hall chiefs as they set out plans to cut street lights, gritting... and so much more

In the middle of a table lies a spreadsheet. On it are rows and rows of numbers representing services that make a difference to people’s lives – such as youth clubs, community centres, lunch clubs for the elderly.

Yet around the table are council chiefs mulling over the tough decisions about where spending cuts should fall.

This process has been happening at town halls up and down the country as council leaders make tough choices about how to reduce budgets next year. Despite the prime minster’s very public promise that “austerity is over”, council chiefs told HuffPost UK this is not the reality for local authorities.

 

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Protestors in Birmingham wave placards objecting to cuts to council services

 

After a decade of deep and sustained reductions to local government budgets, councils across the country must find further savings next year as main grant funding, the money local authorities receive from central government to provide services, is cut by a further £1.3billion (or 36%).

HuffPost UK has been exploring how the loss of individual services at a local level link up to paint a national portrait of austerity in our series What It’s Like To Lose. As part of that, we have asked council leaders what it is like to sit at that table and decide where to put the black lines.

The task was described by one former Labour finance chief as “brutal” while another Conservative town hall boss said in some ways the role was “a poisoned chalice”.

It does show that we are really, really short of money that we’re actually doing this. I mean there is no money.Richard Cornelius, Conservative leader of Barnet Council

Local authorities have already lost 60 per cent of their central government funding over the last decade, substantially more than any other area of government.

And it is in the loss of valued frontline community services that the impact of this austerity drive is most keenly felt by communities across England.

Regardless of their political stripes, the council leaders each called on central government to invest in local government saying the cuts have now gone far enough. But some were keen to say that this should not be at the expense of further borrowing by government.

So acute are the financial challenges that even the most basic services - such as libraries, school lollipop patrols, street lighting, road repairs, cemetery maintenance, gritting - are now being considered for savings. 

HuffPost UK delved into reduction proposals at five local authorities across the country, and found all of these services mentioned in the various plans.

Barnet Council
Richard Cornelius, leader of Barnet Council, said councils are really short of money

Councillor Richard Cornelius, the Conservative leader of Barnet Council, said: “It does show that we are really, really short of money that we’re actually doing this. I mean there is no money.

“We can’t draw on reserves forever and we do have to address our budgetary problem. It’s very difficult.”

Council chiefs say frontline services can no longer be protected as the “low-hanging fruit” of back office efficiencies and staff redundancies to save money in earlier years are now long gone.

Councillor Joe Ejiofor, leader of Haringey Council in north London, accused central government of “whistling money away like there’s no tomorrow” while “punishing the ordinary residents of local authorities” with successive cuts to funding.

The Labour council chief said: “They’re giving contracts for Brexit to ferry companies with no ferries.

“There are millions and millions and millions of pounds that are disappearing down a black hole. National government are not cutting their own cloth or pulling in their own belt. It’s wrong and quite frankly you can quote me as saying that.” 

But in Derbyshire, Conservative county council leader Barry Lewis said it is vital councils look at whether they are operating as efficiently as possible “because it’s all too easy to put up the council tax”.

With Brexit creating economic uncertainty, he said easing the local tax burden was now more important than ever.

Unsurprisingly, the council chiefs clashed on whether the ideology that has driven a decade of declining council budgets is justified.

But there was a wide consensus that the time has now come for central government to stem the tide and invest in local services.  

We’re Being Asked To Do More With Less Money

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Councils are being asked to spend more on adult and children's social services, meaning there is less money for budgets like road repairs

HuffPost UK spoke to a mix of Conservative and Labour local authority leaders up and down the country - in Birmingham, Oldham and Derbyshire, and in the London boroughs of Barnet and Haringey - to better understand how they are coping with the funding challenges and the impacts of lost services.

We also scoured their budget reduction plans to find out what services were due to be reduced or cut from next year and what the impact of that would be.

All the council leaders said town halls are being asked to take on larger caseloads in adult social care and children’s social services. These are services councils have a legal duty to provide, but the rising caseloads come as council budgets are falling, putting extra pressure on finances.

All of this leaves less money to provide day-to-day community services, such as running libraries or filling potholes or staffing youth services. 

Oldham: In Top 10 Worst Affected But Still The Cuts Come

Oldham Council
Sean Fielding (left), leader of Oldham Council, out and about in the community 

In the northern town of Oldham, set amid the Pennines and just seven miles outside Manchester, the county council leader says his area has suffered one of the toughest deals in terms of central government funding.

Councils’ income comes mainly from a mixture of government grants, council tax and business rates, a tax on properties used by businesses, such as shops or offices. Research has shown cuts have hit metropolitan councils in the north hardest, and areas with high deprivation are being put under even more strain as they have less ability to raise council tax money from their residents.

Oldham Council is currently consulting on cuts to cemetery maintenance, community transport services, bus lane enforcement, and gardens and floral displays - just some of the measures it says are necessary to save £17million next year.

Its consultation documents asks local people to “do #yourbit and help us build a cooperative borough by assisting in reducing the costs on services”.

Oldham Council
Sean Fielding, leader of Oldham Council 

Town Hall leader, councillor Sean Fielding, admitted the community is likely to feel the pinch.

“I can’t promise that people won’t notice any difference,” he said. “This is the position that we’re getting to now. If you take that amount of money out of a council then people will start to notice a difference.”

The Labour council chief has demanded the government make changes to ensure a “fair funding formula” for his town, even shooting a YouTube video speaking directly to the chancellor last year.

“Oldham Council is the sixth most cut local authority in the country,” he said.  “Oldham makes the headlines for reasons that we would prefer it didn’t in league tables around levels of poverty.

“Then for us to be in another league table about where public services are being cut the hardest, we shouldn’t be in both.

“Surely if you’ve got issues around poverty, inequality and deprivation, surely we should be a place that’s invested in to tackle those issues.”

Derbyshire: It’s All Too Easy To Put Up Council Tax  

Derbyshire County Council
Derbyshire County Council leader Barry Lewis at historic Cromford Mill

Across the Peak District, in Derbyshire, Conservative council chief councillor, Barry Lewis, says no council leader comes into public life wanting to make cuts to services.

His party overturned a large Labour majority at the last county council elections in 2017, and he says: “As a new administration, that means we can make changes to financial priorities.”

The new administration has invested £6million in roads, repairing 68,000 potholes last year, and has got rid of an unpopular charge for taking small bags of rubble to the tip. Lewis has also halted proposed cuts to lollipop patrols at school crossings after a community backlash. 

While council tax will rise next year, the town hall chief hopes to deliver a two-year freeze to rates in the future.

But consultation is currently underway about £13million of budget reductions next year - which include saving £1.6million by asking the community to run 20 of the 45 council libraries themselves.

The council leader claims this model will reinvigorate the services.

“I think there are getting on for 400 community-led libraries now in the UK and what you see is that the libraries become very much a focus of the community, they do other activities, they are places where people will go to do other things,” he said.

“Some of them are running farmers’ markets, for example, to bring in income, so they become much more a focus of the community.”

Existing council staff will also be asked to drive gritting trucks, which is already stipulated in their contracts, rather than paying outside contractors to do this, allowing the council to save money without reducing services, he says. 

Consultation documents also mention budget reductions to road safety, grants to preserve historic buildings, reduction in sports facilities for young people, services for teenagers, and council building maintenance.

Derbyshire County Council
Barry Lewis took up his role as leader of Derbyshire County Council in 2017

While the council chief welcomes the opportunity to shape the way savings fall he says candidly that no council leader takes up office wanting to cut services.

“It is a poisoned chalice when you take over a local authority at a time like this,” he said. “There are no two ways about it. It is what it is and we have to deal with it.”

He said the government is not a “knight in shining armour coming over the hill” and councils must address the issues at a local level.

Lewis says philosophically, as a Conservative council, there will always be focus on “providing opportunities for lower taxation” which creates a better economy.

But he conceded some county councils are now “very much at a cliff edge” and said you can only reduce budgets up to a point where it’s simply not sustainable to do it.

“I think it’s time now for government to take a very close look at what our key statutory responsibilities are as councils and what its key statutory responsibilities are in terms of looking after the most vulnerable in society,” he said. “And the two key budgets for us are around adult social care and children’s services.

“Derbyshire is a lovely place to live, it’s a lovely place for people sometimes to retire to and that’s again great, but it does mean that we have particular impacts on our budget at a consequence of that.” 

Birmingham: We Can’t Continue To Use Reserves To Plug Gap

PA Archive/PA Images
People protesting against Birmingham City Council cuts in 2017

Meanwhile in the Midlands, Birmingham City Council must find huge savings of £50million next year, the largest of the six councils we looked at. The council is Europe’s largest local authority, serving more than a million people. 

Labour leader councillor Ian Ward says the impact of years of austerity spending cuts in Birmingham are clearly visible - in rising homelessness, the effects of welfare reforms and the rising number of in-work families living in poverty.

One of the ways Birmingham City Council has been stemming the impact on frontline services, like many others, is by dipping into its reserves.

But the council no longer has the option to do this next year after being warned by auditors for using £117million in two years to balance the books.

“We’ve set a budget for next year that has no reserves in it, because obviously you can’t carry on using reserves indefinitely,” the leader told HuffPost UK.

Sweeping savings proposals include closing council-owned community centres, halving the number of books at Birmingham libraries, dimming street lights overnight, making money from parks by introducing parking fees or introducing paid for activities like adventure golf or high ropes, and increases in burial fees.

Dave Warren for Birmingham City Council
Ian Ward, leader of Birmingham City Council 

Axing lollipop services and charges for pest control were on the table but were removed following public consultation.

“I think what that’s telling you is there are no more low-hanging fruit, there are no more easy options and we’re having to look at basic services,” said the council leader. “Because everything else has been cut to the bone as a result of government cuts.”

He says the council relies heavily on government grants because it has areas of high deprivation and therefore less ability to generate revenue from council tax.

The town hall chief said a lot of investment is coming into Birmingham inner city centre but the more deprived communities immediately outside are increasingly struggling to make ends meet.

“I think people are fed-up of austerity,” he said. “They’ve had enough of it and I think the government needs to get the message. The prime minister needs to be true to her word and if austerity is over, she needs to end austerity in local government.”

Haringey: ‘Cuts In Previous Years Are Catching Up With Us’

HuffPost UK
Joe Ejiofor (centre), leader of Haringey Council, at the opening of the Pocket Living Community Centre

In boroughs across London, a debate also rages on over the fairness of the formula used by central government to distribute money to councils.

Haringey is consulting on £7million of cuts next year, with proposals to slash the temporary accommodation budget, public health services including sexual health and substance misuse, parking enforcement and litter enforcement.

Labour leader councillor Joe Ejiofor said he is not only grappling with the next round of funding reductions but also the effects of losing services in previous years.

“There is one area in particular where we have been seeing the impact of cuts made many, many years ago and that is in youth services,” he said.

“Youth provision being non-statutory [a service that does not have to be provided by law] it was one of the first things that councils felt that they could cut.

“The impact of that in later years has been increases in exclusions, increases in knife crime, youth crime, youth violence, youth disaffection, because we haven’t been engaging with young people as early as we used to do in previous years.”

Ejiofor said it has taken a number of years for this to work its way through the system. 

Haringey Council
Haringey Council leader Joe Ejiofor says the borough is feeling the impact of cuts years ago

But in other ways he believes communities have been shielded from the full force of the sweeping reductions that have affected local authorities.

“One of the things that is a little bit unfortunate is how successful local government has been in delivering national government austerity,” he said.

“I mean our budget has reduced by £122million in the last eight years, that 56% in real terms. I’m not saying there was lots and lots of fat and lots and lots of excess in local government before, because there wasn’t.

“But we have managed to reorganise services, we have managed to re-provision and partner in some of the things that we’ve done, and up to a point I don’t believe that our residents have seen the full brunt of the efficiencies that we’ve had to make.”

Barnet: ‘You Can Spend Less And Still Provide Good Services’

PA Archive/PA Images
Barnet Council has outsourced £500million of services to Capita

In the large north London borough of Barnet, another Conservative led town hall, £500million of services have been outsourced to business giant Capita, which led a few years ago to the authority being dubbed the “easy-council”.

Town Hall leader councillor Richard Cornelius defended the outsourcing model saying in some areas, such as payroll and back office functions, the council simply could not achieve similar economies of scale by running these services in-house.

He believes the council has done its best to “mute” the impact on residents but Barnet is currently consulting on £27.1million of cuts next year including reduced investment in school buildings and suggested community management of parks.

But asked whether he sees the impacts of austerity in his community, the council leader said: “No, not yet, not yet. The place isn’t quite as clean as we would like. If we had a bit more money we could do a bit more street sweeping but other than that I think the impact has been very limited.”

He believes the last decade has shown it is possible to spend a lot less on local government and still provide good services.

But he added: “I won’t go on about central government that has spent too much and national cuts that are effectively being delivered locally.”

‘An End To Austerity? No End In Sight’

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Theresa May announced at the Conservative Party Conference in 2018 that 'austerity is over'

Despite the prime minister’s promise of an end of austerity at the last Conservative Party Conference, all the council leaders told HuffPost UK an end to reductions in local government funding is not yet in sight.

All are eagerly watching to see what the government will announce as a result of its Fair Funding Review, which will change the calculation of each council’s funding needs. This was put out for consultation from December 2017 to March 2018, and the government has said it would like to see it in place by 2020-21.

The review’s first iteration was criticised for removing deprivation as a funding criteria and shifting spending away from urban areas. 

“Central government is looking at the way all local authorities are funded and I think there’s a document that’s almost ready to be published that will probably cause as much fuss as Brexit in the world of local government,” said the leader of Barnet Council. “It will be a redistribution of money across the piste across councils.” 

In the meantime former council finance chief, Theo Blackwell, now chief digital officer for London, said there are real opportunities for councils to use data to provide services that work better for the user.

Greater London Authority
Theo Blackwell, chief digital officer for London, says councils can use data to transform services and save cash

As a former Labour councillor and cabinet member for finance in the London borough of Camden, he oversaw the budget reduction process for many years and said it was often “brutal”.

But he said it has also driven innovation and a complete change in the way councils think about delivering services.

Blackwell highlights a pilot project carried out in Camden tracking how one single mum interacted with the council around 100 times over five or six years.

“One of things that was noted when they went through all the data was over a certain period of time, when things got really, really chaotic, the person kept putting in for a housing repair for a door,” he said.

“Over a six month period a door had to be repaired four times and that on the system, under the old way of doing things, would have been logged as, ‘We’re efficiently repairing a door’, that’s what the computer said.

“But a domestic violence worker looking at that says, ‘That door has been kicked down’. So the ability to pick up those things in a really complex organisation with lots of data flying around is now really central to how councils do things.”

He said the flip side of the story of how council leaders are making decisions to slash millions from budgets is the story of how they can use data to innovate.

“They need to think very deeply about digital transformation because it can help them deal with very significant budget reductions,” he said.

What Does The Government Say?

Ministry for Housing, Communities and Local Government
Local government minister Rishi Sunak MP

The Ministry of Housing, Communities and Local Government says it has provided local authorities with access to £91.5billion over the next two years and councils are receiving £1billion in extra funding this coming year.

But the Local Government Association says this money is through ring fenced grants rather than in main grant funding, meaning the government is effectively giving with one hand and taking with the other.

Local government minister Rishi Sunak MP has said this year will be “an important one” for local government.

“We’re clear that we want to build a sustainable long-term future for councils, so we need to ensure that the way we decide how to assign funding is fair and in line with the needs of communities,” the MP said, writing for HuffPost UK.

“People must have access to the day-to-day services they need, whether it’s regular rubbish collection or being able to visit their library and health centre.

“We’re already taking a number of steps to begin reassessing local government’s funding.”  

The Facts And Figures 

Cuts to local authority budgets began in 2010 under the coalition Conservative and Liberal Democrat government, as part of the wider reform agenda to reduce the deficit following the financial crisis of 2008.

But almost a decade on the Local Government Association (LGA) says more and more councils are struggling to balance their books, facing overspends and having to make in-year budget cuts.

Some of the basic facts and figures highlighted by the LGA are;

- Between 2010 and 2020 councils will have lost almost 60p out of every £1 the government provides for services.

- Main government grant funding for local services will be cut by a further £1.3billion (or 36%) in 2019/20.

-  It is estimated councils would need an additional £8billion more than they are expected to have in 2024/2025 to deliver the same services as today.

Against this financial backdrop, the LGA says there is an ongoing surge in demand for council services.

Town halls are being asked to take on larger caseloads providing statutory services in adult and children’s services, and housing homeless families.

All of this leaves less money for day-to-day services such as running libraries or filling potholes.

The size of local government staffing has also shrunk significantly over the last 20 years by 629,000 (or 23% of the directly employed council workforce), while central government staffing has increased by 31%.

The LGA has called on the chancellor to tackle this “funding crisis” and says it is working hard to try and bring money back into local government.

Cllr Richard Watts, chair of the LGA’s resources board, said: “Losing a further £1.3billion of central government funding at this time is going to tip many councils over the edge.

“Many local authorities will reach the point where they only have the funds to provide statutory responsibilities and it will be our local communities and economies who will suffer the consequences.

“In his Spring Statement last March, the Chancellor said he would invest in public services if public finances improve as recent forecasts have suggested. It is therefore vital that the government addresses the growing funding gaps facing councils in 2019/20 in the Autumn Budget.”

Lauren Gosling-Powell for HuffPost UK

In a new series, HuffPost UK is examining how shrinking local budgets are affecting people’s daily lives. These are stories of what it’s like to lose, in a society that is quietly changing. If you have a story you’d like to tell, email basia.cummings@huffpost.com.