Councils have been hit by a £4bn deficit in income over the course of the last two years as the recession has taken its toll.
Figures published by the Local Government Association show that sales of land, council buildings and other capital projects have fallen by £2.7bn since 2007/08. The other main cause of loss is lower interest on council’s cash deposits. This resulted in a fall of £1.3bn. Income has also gone down from leisure centres and a range of other services.
Sir Jeremy Beecham said: “The tough economic outlook is forcing councils to take a look at almost every aspect of their finances. Almost 7,000 jobs have gone in the last six months alone and as the effects of the recession continue to be felt, we fully expect councils to keep on cutting jobs over the course of the next twelve months. Despite this, local government has delivered the lowest council tax rise for over a decade and is continuing to make big efficiency savings.
Young people are being hit particularly hard by the recession, with hundreds of thousands finding themselves unemployed and not in any kind of training. The LGA has committed to working with local authorities to increase the number of council apprenticeships by 7,500.”