FINANCE

One in 10 county councils facing effective bankruptcy

England’s county and unitary authorities are ‘running out of road’ to prevent insolvency, with one in 10 not sure they can balance their budgets this year.

England's county and unitary authorities are ‘running out of road' to prevent insolvency, with one in 10 not sure they can balance their budgets this year.

A Society of County Treasurers survey of its 41 member councils, carried out with the County Councils Network (CCN), revealed a total funding gap of £1.6bn this year.

Shortfalls of £1.1bn and £1.3bn in 2024-25 and 2025-26 meant the councils were facing a £4bn deficit over the next three years.

The local authorities plan to reduce the deficit by half, with £2bn of ‘unprecedented' further savings pencilled in over the three-year period, including £1bn this year.

This leaves them with a collective £639m overspend for 2023-24.

CCN finance spokesperson Barry Lewis said: ‘The number of vulnerable children requiring care has risen dramatically post-pandemic, while inflation and a broken provider market in statutory care placements mean councils face no choice but to pay spiralling fees.

‘A decade of continuous cutbacks, the scale of reductions and use of reserves needed to fill the funding shortfall is simply unsustainable.'

FINANCE

We're ready to lead

By Joanna Killian | 27 June 2025

Ahead of the LGA Conference, Joanna Killian says the sector should take confidence in how far it has come and the potential that lies ahead, and that its fut...

FINANCE

Forging the future

By Martin Ford | 25 June 2025

With the sector in crisis and the need for radical change, fundamental questions are being asked about what local government is for. Martin Ford reports.

FINANCE

Council tax hikes will do the heavy lifting

By Kate Ogden | 17 June 2025

Surprisingly, local government wasn’t at the end of the queue for the chancellor’s cash – or at the front – but it is the upcoming consultation on funding re...

FINANCE

Wanted: Greater funding fairness

By Clare Keogh | 13 June 2025

Clare Keogh of Unite says the union’s new campaign and early day motion are designed to make the Government ‘do the right thing and fund local authorities pr...

Popular articles by Ellie Ames