Each ELL borough will see their spending power cut under the Local Government Finance Settlement outlined on Wednesday by Eric Pickles, The Secretary of State for Communities and Local Government.
Following the announcement, Jules Pipe, Mayor of Hackney, speaking as Chair of London Councils issued a warning to Pickles: “He cannot go on reducing funding for local services without impacting on London’s communities and the quality of services.”
“This Local Government Finance statement confirms that local communities and the vital services councils provide are bearing the majority of the pain of paying off the deficit. It’s thirty per cent reduction over the four years till 2014.”
Under the settlement, Lewisham council, which has already outlined savings of £28.3m over the next three years, will see the biggest fall with a 1.4 per cent cut.
Hackney’s spending power will drop by 0.9 per cent and Croydon’s by 1.2 per cent. Tower Hamlets has fared well with just a 0.4 per cent cut.
Croydon council this month outlined a proposed £35.9m of savings over the next two years. Tower Hamlets and Hackney have not yet released budget proposals for 2013/14 and beyond.
Nationally, the average council faces a 1.7 per cent spending reduction. The highest cut in London is 2.8 per cent for Kensington and Chelsea. Walthamstow Forest is the only borough to see a rise in spending power, by 0.2 per cent.
Croydon will have the lowest spending power per dwelling of the ELL boroughs at £2188, Hackney will have the highest of the four at £3234.
Pickles, in his statement to the commons, said: “English local government accounts for £1 of every £4 spent on public services. It spends £114 billion – that’s twice the defence budget and more than the NHS.
“Striving councils will benefit by doing the right thing by their communities.”
The minister also published a government document outlining 50 ways local government could save money including: closing subsidised council canteens, cancelling ‘away days in posh hotels’ and ending ‘glitzy award ceremonies’, scrapping the post of chief executive and no longer translating documents into foreign languages.
Hackney and Lewisham Councils told ELL that it is too early to say how the new figures will affect each authority and next year’s budget. All four ELL borough councils declined to comment on Pickles’ saving proposals at this time.
Each council will be releasing their 2013/14 budgets in January.