Title

FINANCE

The answers cannot wait for long

If local government is to play the vital role required in the recovery of places and communities, it will need some clarity and medium-term certainty about the underpinning finance regime, says John O'Brien of London Councils.

Even before COVID-19 hit, the foundations set in place for the future of local government finance put in place by George Osborne five or six years ago were already beginning to look increasingly unstable.

The almost permanent inability to resolve the issue of the future form and financing of adult social care, allied to the progressive erosion of confidence that some form of retained business rates regime either could, or should, help underpin a future system, had already contributed to the sense the future was rather less clear than it had once seemed.

The financial challenges facing the sector are significant for most and, as we have seen, desperate for some.

While the recent settlement does not meet the scale of the pressing need that exists across the sector, some of the support made available will help councils keep some stability a little longer.

That, of course. does not mean there are not real and painful service reductions being implemented now, or that jobs are being lost. This brings us back to the critical need for a new financing road map.

The public expenditure outlook is tough whichever way you look at it, but for local government to be able to play the vital role required in the recovery of our places and communities, it will need some clarity and medium-term certainty about the underpinning regime.

What, for example, is the future of business taxation and what is its relationship to funding local public services?

What is the future model for delivering adult social care and how will it be funded?

What remaining ambition is there for moving towards greater sub-national fiscal powers as part of any renewed focus on devolution?

The delay in responding to some of these questions has been an understandable reflection of the scale of the uncertainty we have been going through. The answers cannot wait for too long.

John O' Brien is chief executive of London Councils

@londoncouncils

FINANCE

MPs scold Home Office over lack of council involvement in asylum

By Dan Peters | 05 June 2026

Local authorities still lack a ‘meaningful say’ in asylum accommodation decisions, a cross-party committee of MPs has warned.

FINANCE

Councils question financial sustainability and timescales of SEND reforms

By Joe Lepper | 05 June 2026

Councils have raised a raft of concerns around the Government’s plans to overhaul the special education needs and disabilities (SEND) system.

FINANCE

What England can learn from Japan's approach to local government finance

By Naoki Fujiwara | 04 June 2026

Consideration of Japan’s approach to local government funding suggests possibilities for doing things differently in England and opens up space to think abou...

FINANCE

Governing through uncertainty – what happens next?

By Tim Farr | 04 June 2026

In an era of permanent uncertainty, Tim Farr assesses the challenges many local authorities, chief executives and senior leadership teams are now navigating ...

Popular articles by John O'Brien