PWC survey paints gloomy picture for council services

Two thirds of council leaders expect many local authorities to end up in financial crisis next year, according to the latest survey of local government confidence.

The Local State We’re In report, published by PriceWaterhouseCooper (PwC), revealed nine out of 10 council leaders and chief executives believe that some local authorities will get into serious financial difficulty in the next five years, and that eight out of 10 will fail to deliver essential services.

The report also highlighted a significant decline in leaders’ confidence in protecting front line services, whilst only 35% of the public accept the need to reduce or cancel services in their area – a 10% drop since 2011.

Public concern about the scale and impact of local government service cuts is also shifting to its impact on the community rather than individuals. Overall, half of the respondents are concerned about the impact of cuts on them personally, but concern for the wider community impact is higher (58%), particularly in the North West, Yorkshire and Humberside, and Wales, where over 60% are concerned.

Jonathan House, from the PwC local government team, said: “In the short term, with little political appetite for top down local government reorganisation and no sign of financial pressures abating, it is being left to councils to develop new models of collaboration from the local level up. Whether local innovation alone will bring about reform at the scale and pace needed is another question.”

“Looking to 2015 and beyond, there is clear appetite from council Leaders and Chief Executives for a new deal between central and local government, with 83% of respondents believing that the financial dividends of their investments in service reform, collaboration and growth should be retained locally.”

In response to the survey, Solace, the body for senior strategic managers in the UK public sector said: ‘The latest survey from PwC serves to demonstrate the financial difficulties consistently falling funding is causing for councils. Integration is key for the future of local public services as budgets continue to be reduced. It drives efficiency, but more importantly enables early intervention and prevention.

‘Solace supports the continued pressure on Whitehall for greater financial freedoms for councils, with local leadership on council tax, business rates and borrowing for infrastructure. Local accountability must be the route taken for local solutions.’

To download the full report, click here: http://www.pdf.pwc.co.uk/the-local-state-2014.pdf