Mayor calls for review of council funding formula

Mayor of Liverpool Joe Anderson is calling on the Government to urgently review its funding formula for local authorities – in the wake of a new independent report which has found the city has been hardest hit per head by austerity.

Cities Outlook 2019 from the Centre for Cities – an annual health check on UK city economies – reveals that Liverpool has lost £441 million since 2009/10, equivalent to £816 less for every man, woman and child, more than any other place in the country.

This puts cuts to local government services in Liverpool 18 percentage points higher than the national average in real terms, which works out at £529 above the national average per head.

It comes amid concerns that it will be shire counties that benefit most from the current review of the council tax funding formula.

Mayor Joe Anderson said: “This report confirms what I’ve been saying for years. We’ve not been asking for special treatment – just fairness. If we’d have had the average cut of other councils we’d be £80 million better off.

“Since 2010 we’ve cut around 3,000 staff, and had to take tough decisions on all areas of spending including adult social care, transferring some libraries and youth centres to the voluntary sector and selling buildings.

“We’ve worked hard to keep all of our children’s centres and leisure centres open and continued to run the best cultural events programme in the country. We are doing great things around infrastructure such as housing, regeneration and jobs by being entrepreneurial and creative, but we are being held back by the cuts in day-to-day spending.

“We’re making millions of pounds every year from our innovative ‘Invest to Earn’ strategy, where we make smart investments that deliver a return, but instead of using that money to grow the economy further we are having to use it to plug the cuts made by Central Government.

“My fear is that with Brexit dominating the domestic political agenda and Parliament in deadlock, the needs of desperate councils – especially larger urban authorities – are way down the ministerial pecking order.

“The Government is turning a blind eye to the reality of what is happening to local authorities, in particular the poorest. We are limited in the amount we can bring in from council tax because Government has restricted rises and most of our properties are small terraces. For instance, we get £174 million in Council Tax and we spend £172 million on adult social care – it doesn’t take a mathematician to see that this isn’t sustainable.

“Government urgently needs to revisit its plans for the funding formula and try and come up with one that is genuinely fair to everybody across the country. Only by doing so can places like Liverpool actually meets its needs and requirements to help those most in need.

“We also need more freedoms and loosening of the Whitehall purse strings so we can return to an era where councils devised their own practical solutions to problems, so we aren’t waiting for an end to ministerial indifference.”