Centre of a storm: Croydon’s council is one of a cluster of local authorities facing catastrophic collapse, according to a report by union Unison
There’s a £4billion black hole in council finances, warns one of Britain’s biggest trades unions – and that’s before the latest budget-busting £42million overspend by Croydon’s cash-strapped council is taken into consideration.
Unison, which represents hundreds of thousands of council workers, says the overall deficit is “way beyond” previous estimates and is likely to mean “massive cuts” to jobs and vital services across the country.
Unison’s figures may appear to be a tad on the optimistic side. Croydon alone, after all, has £1.5billion of debts which it is struggling to service every year, even after Conservative Mayor Jason Perry hiked Council Tax by 21% in the space of 12 months.
Perry was elected on a promise to “fix the finances”. He has failed, after only belatedly discovering ever-rising demand for children’s services and increasing need for housing for the borough’s homeless – statutory services which Perry has to deliver, by law. Croydon’s dilemma is unfixable without a change in government approach.
No reply: Angela Rayner has ignored Perry’s begging letter
Unison says that other local authorities across the country are also encountering ever-steepling demand for statutory services, with an increasingly reduced amount of government support in real terms.
The gathering storm was ignored for more than five years by the last Conservative government, where Michael Gove was for much of that time Secretary of State for local government, standing by as a succession of councils followed Croydon into effective bankruptcy.
Now, it seems, Labour’s replacement for Gove, Angela Rayner, is also avoiding the issue. A begging letter to the minister from Croydon’s piss-poor Perry, sent just weeks after Keir Starmer’s Labour won the General Election, has been all but ignored by Rayner.
But how long can Rayner and Starmer’s government continue to ignore the calamitous collapse of councils around the country?
The Unison report, Councils On The Brink, was delivered ahead of the Trades Union Congress annual conference staged in Brighton. It says that the worst-hit local authorities are Hampshire County Council (£132million deficit), Bradford City Council (£126million), Birmingham City Council (£119million), Somerset (£104million) and Leicester City Council (£90million).
Unison says local communities served by the councils are facing “a potentially catastrophic and far-reaching effect”.
‘The very fabric of society is under threat’: Unison’s Christina McAnea
Bradford City Council is this month auctioning off a swimming pool, two former care homes shut down by earlier cuts, some former school land, a car park and other publicly owned assets — the first of 150 earmarked for sale.
Leaders at Hampshire County Council plan to end support for homeless people from March next year.
Europe’s largest council, Birmingham, is to implement one of the biggest local government cuts packages in history – including shedding up to 600 jobs, slashing social care and children’s services and reducing waste collections.
Unison general secretary Christina McAnea said: “After 14 years of ruthless austerity, the very fabric of local society is under threat.
“Councils are quite simply the lynchpin of local areas, so when services go, many people are left vulnerable, with no one to pick up the pieces.
“Local authorities were clobbered by the previous government, whose harsh financial settlements left councils with no option but to sell off the family silver, auction off green spaces, close key community facilities and let thousands of workers go.
“Only swift and decisive action to stabilise local finances will do.
“Ministers cannot ignore the terrible plight of authorities of every political persuasion.
“There’s an unquestionable need to turn the page on the destructive cuts of the past and invest in services and staff to help councils rebuild Britain.”
Read more: Dear Angela: It’s time for you to fund Croydon fairly
Read more: Mayor Perry busts his unbalanced budget with £42m overspend
Read more: It’s time for our elected councillors to stand up for Croydon
Read more: Perry pleads poverty when he has more Council Tax than ever
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ROTTEN BOROUGH AWARDS: In January 2024, Croydon was named among the country’s rottenest boroughs for a SEVENTH successive year in the annual round-up of civic cock-ups in Private Eye magazine
We’ve been here before – 12 years ago the leader of Birmingham Council announced, “the end of local government as we know it”. His local authority, England’s biggest, then embarked on a staggeringly incompetent IT splurge that has so far run up £100 million and-counting bill that has delivered zilch. Nada. Nothing. Like loads of incompetents – including Croydon – they also used the new powers to invest in Ponzi schemes that lost even more money. Until our civic leaders can learn humility and basic economics, they do not deserve never-ending tax-payer bailouts. Perhaps these wise Unison leaders could help?