A survey of 129 council leaders by the Local Government Association shows that half the councils in England have axed jobs in the last few months and seven in ten anticipate further redundancies.
In the south-west, 67% of councils have already made cuts in staff; in the the south-east, 57%; and so on down to Yorkshire and Humberside (37%).
In some areas, councils are the largest employer, and across the UK they employ 2.2 million workers.
Cuts in jobs mean cuts in services — at a time when the economic crisis means an increase in the need for housing benefit, council housing, debt advice, retraining courses, social services...
The LGA report also shows that council income from services they charge for, land sales and interest from deposits is projected to fall by £2.5 billion next year.
The economic crisis, squeezing public spending sharply over the coming years, is bound to push along further cuts.
In moves like Wirral council’s Strategic Asset Review or Barnet’s “The Future Shape” programme, councils have already been privatising and contracting local services, with cuts in housing, social services, transport, leisure, waste collection, council tax collection and education.
The councils clearly feel confident that they can get away with large-scale cuts. They may also try to reduce local government pensions.
The Local Government Pension Scheme (LGPS), which covers 3.7 million former and present employees of Britain’s local authorities, had its deficit was reported as £23 billion two years ago. That deficit rises to £45 billion when restated under the recently adopted pensions accounting standards, and then to about £80 billion following the recent collapse of share values.
Local government spending is about a quarter of all public spending in the UK. Most of councils’ revenue comes via central government, through “grants” and through redistributed business rates.
Council tax provides about a quarter of revenue. That means that for a 10% increase in spending, a council would have to raise council tax 40%; but in any case central government has power to “cap” local authority budgets.
Councils thus have much less financial autonomy than they had 25 or 30 years ago. A council rejecting cuts would quickly have to defy central government — as some Labour councils tried to do in the 1970s and 80s — by deliberately running an “unbalanced” budget and mobilising local workers to demand cash from central government.
No council as yet shows the least sign of doing that. Whether Labour, Liberal or Tory-run, they have been privatising and contracting out as much as possible.
Our Wirral Against the Cuts campaign would like to know about the cuts being made by councils across the country, and about campaigns that have been set up to stop them. We need to begin to link up the opposition as these cuts intensify.
Elaine Jones is vice-chair of Wirral TUC. Contact her at email@example.com.