Nearly one in five council bosses believe it is “fairly or very likely” that they will go bust in the next 15 months as the crisis in local government funding continues to impact councils across the country.
Local government experts have warned every council in England will be effectively bankrupt within the next three years unless major structural reform or additional funding is forthcoming.
With this in mind, Digital PR Company Reboot Online examined the impact of rising inflation and the cost of living crisis on spending in local constituencies across the United Kingdom.
To do so, budget and spending data from the Independent Parliamentary Standards Authority (IPSA) from 2016 to 2021 was analysed.
Total spending data was forecasted for the years 2022-2024 using a linear model based on historical data and then adjusted to Consumer Price Index (CPI) inflation, using a combination of OECD rates and forecasted rates. This provides a statistical foundation for understanding how local government spending has been impacted by recent economic pressures, and determining which constituencies are most affected.
Digital PR Company Reboot Online have projected that Brentwood and Ongar (Essex) will undergo the most substantial spending cuts in 2024, with an anticipated decrease of almost a third (-28.65%) compared to 2021 spending data.
This is a significant decrease in spending compared to the neighbouring constituency of Epping Forest, which is forecasted to experience a spending increase of around two-thirds (+67.36%) from 2021 to 2024.
Kingswood (South Gloucestershire) is forecasted to receive a -19.73% cut in spending in 2024, falling from £147,207.95 to £128,795.57, which is the most significant decrease in the South West region. This is a stark contrast to the neighbouring constituency of Filton and Bradley Stoke, which is forecasted to have a spending increase of +19.84% in 2024 when compared to 2021 levels.
Ayr, Carrick and Cumnock, a constituency in Scotland, is also expected to see a reduction in total spending of over a quarter (-25.23%) from 2021 to 2024. In Gordon, another Scottish constituency, there is predicted to be an -18.48% cut in 2024 spending compared to 2021 figures.
Digital PR Company Reboot Online’s study forecasted that Kettering (Northamptonshire) will see a +74.44% increase in spending from 2021 to 2024. This is a significant increase in projected spending compared to neighbouring constituency Daventry where there is a forecasted local spending increase of just +8.59% in the same period.
Swansea West is also projected to be among the least affected constituencies by local government spending cuts in 2024, where local spending is projected to increase by +69.34% from 2021 levels. In comparison, spending in Swansea East is forecasted to increase by just +8.60% in the same period.
Walthamstow (Greater London) is the third constituency expected to experience a substantial increase in local government spending, despite rising inflation rates and the cost of living crisis. Projected spending in Walthamstow in 2024 is +69.04% higher than the spending in 2021, rising from £249,844.49 to £422,336.27.