City leaders warn of crisis over cuts to funding

The leaders of seven major cities have warned that deprived areas face a “looming financial crisis” because of new austerity measures.

The heads of Liverpool, Birmingham, Nottingham, Sheffield, Newcastle, Manchester and Leeds councils forecast that core public services will have to be reduced after a fresh round of cuts was announced to their Treasury funding. Adult social care, youth clubs, libraries, careers advice and waste collection are especially vulnerable.

The Communities Secretary, Eric Pickles, announced cuts yesterday to central funding for local authorities ranging from three to 8.8 per cent. By the end of this parliament in 2015, councils will have seen their funds reduced by one third.

It came as the Government published a list of “sensible savings” ideas for councils, ranging from opening a coffee shop in the local library to cancelling “glitzy” award ceremonies. The 50 tips for town halls also include cutting spending on consultants and agency staff and on head hunters and expensive adverts, which can cost thousands of pounds in national newspapers.

The heads of the cities said in their joint letter: “The cuts we are being asked to make in the years ahead will go far beyond the level at which we can protect vital local services.

“Many non-statutory services that improve the quality of life and provide real economic value are already at risk of disappearing in the next two years.” The seven leaders said that they had already made “diligent and innovative” savings over the past two years.

Mr Pickles insisted his plan represented a “bargain” for councils and suggested they start by cutting pay, scrapping chief executive posts and ending councillor pensions. “This settlement recognises the responsibility of local government to fund sensible savings and make better use of resources,” he said.