Fundamental reset needed to deal with financial crisis

Judging by the headlines in recent weeks, it's fair to say that the penny has finally dropped regarding the parlous state of local government finances. And not a moment too soon.

First, thanks to the excellent work of the County Councils Network, we had dozens of MPs, including more than 40 Conservatives, writing to the PM demanding extra funding for councils in England to avoid big cuts to services.

Then, the Commons Levelling Up, Housing and Communities Committee produced a timely and sobering report 'Financial distress in local authorities'.

Chair of the Committee Clive Betts MP, warned: "The problem now is not just individual councils having difficulties if the whole of the local government system simply being underfunded and under-resourced, and not being able to meet its statutory requirements."

As I'm sure readers are aware, there are specific problems of our own making that must be fixed in my city Birmingham. But the sheer scale and widespread nature of the growing financial crisis in local government clearly indicates a more fundamental problem.

And like almost any crisis, this hasn't happened overnight. For anyone who has been paying attention, the warning signs have been there for some time. Our sector has been hollowed out since 2011 and now we are seeing the long-term consequences of austerity.

In addition, as Stephen Jones, Director of Core Cities UK, made clear in his evidence to the committee, councils are faced with spiralling demands in areas like adult social care, homelessness, and temporary accommodation.

In times of crisis, it is tempting to turn inwards and focus on your own problems, but that would be a huge mistake. The need for us to work together, share ideas and make the compelling case for cities has never been greater.

DLUHC Select Committee Chair Clive Betts MP is right to call for a "fundamental reset and a fundamental reform of the whole of local government finance." Our sector is broken - but not beyond repair. So we must lobby and campaign together, make a compelling case for the funding and powers to fix it.

And of course, we must continue making the case for the crucial role cities can play in boosting Britain’s prosperity.