Provisional 2024-25 Local Government Finance Settlement

LGIU Response: Provisional 2024-25 Local Government Finance Settlement

Jonathan Carr-West, Chief Executive, LGIU, said:

“This year’s provisional financial settlement does not address the severe problems at the heart of local government finance and is simply too little, too late. There is little confidence across the sector in local governments’ financial resilience. In March this year, only 14% of senior council figures said they were confident in the sustainability of local government finances. Since then, three more councils have announced their effective bankruptcy.

The key problem is not the scale of annual financial settlements – although that can make any given year harder or easier for councils to manage. The key issue is with the long-term resilience of the sector. Only 6.25% of senior council figures were happy with the progress that had been made by central government on delivering a sustainable funding system.

This settlement does not address these concerns. The severe systemic problems faced across English local government can only be addressed through multi-year financial settlements based on need, more fiscal flexibility for councils in both how they raise and spend money, and most crucially of all – engagement between central and local government as equal partners dedicated to delivering essential services.

A system where local governments only find out how much money they have for a year, without significant consultation, and with limited capacity to change their own financial position, can never succeed in meeting the long-term needs of the sector.”