What do Birmingham, Woking, Slough, and Bradford all have in common....?
They are all cities in England in which the local councils have gone bust.
Central government invariably blames council bankruptcy on financial mismanagement by the individual councils themselves, or due to local specific issues, such as with case of Birmingham's equal pay debacle.
However, almost a fifth of council leaders say they are risk of going under in 2024, and when there are such a huge number of councils it is HIGHLY unlikely that ALL of them have poor financial management, all of a sudden, all at once.
It is much more likely that there are underlying trends which mean even competent managers, frankly, can't manage!
Two underlying reasons
Firstly, there are many many years of squeezing the amount of money central government gives to local councils.
Secondly, there are the increasing demands which central government makes on local councils to provide mandatory services.
There are FOUR areas which now take up around 75% of local government budges...
- adult social care
- homelessness accommodation
- Children's services
- School transport.
Local councils have a statutory duty to provide all of the above and they can be fined if they don't do their duties.
Most of the above have seen increases in demand over the last few years while less money has been provided by central government to meet these demands.
Adult social care is the main driver of council bankruptcy. We have an ageing population and an NHS which is creaking, thus more people requiring some kind of support at home as they get older.
With children's services more children are registered as having Special Education Needs, and paying for taxis for some kids to get to school costs as much as it would do to send them to ETON.
All one needs to do is to step back to see that it's not the councils' fault that they are going under, the 20% that are struggling are almost certainly just those with more people in need.
A convenient scapegoat...
However things are unlikely to change given that this arrangement deflects blame away from the central government.
Making councils responsible for the four services above and then not funding them adequately is a cunning way of central government dodging responsibility.
However ultimately it is local people who bear the cost... as other services such as bin collection, recycling, local park budgets, all get cut to make up for this, or councils just go bust.
We really need more joined up solutions, dealing with homelessness for example really shouldn't cost that much money if we invest in adequate housing for all, and decent public transport or social housing near to accessible schools would help reduce the need for taxis to school.
But the Tories simply don't care, and doubt that much will change under Labour either.