Neighbourhood services

Summarising the effect of decreased spending, cost of living pressures and rising demand on neighbourhood services.

Key figures

  • £18.6bn – the total amount spent on local authority services, excluding adult social care and children’s services, in 2021/22. This is 3.5% lower than in 2020/21 and 30.6% lower than in 2009/10.
  • Nine – the number of section 114 notices issued since 2020, effectively declaring a local authority bankrupt, compared to three in the previous 20 years.
  • 104,510 – the number of households in temporary accommodation as of Q1 2023, up from 51,310 in 2010.
  • 41.5% – the proportion of waste sent for recycling in 2021/22, below the government’s target (set for 2020) of 50%.
  • £14.0bn – the combined maintenance backlog across the local authority road network.
  • 73% – the proportion of people who are satisfied or very satisfied with their local area, the lowest level in a decade.

Rising demands, decreased spending

The situation for local authority neighbourhood services is bleak. Spending has decreased by 31% since 2009/10, while demand has risen, costs have increased, and staff numbers have reduced by nearly a quarter. In recent years, there have been nine Section 114 notices compared to just three in the previous 20 years. Councils expect to exceed core funding by £2bn in 2023/24, while only 14% of senior council leaders are confident in the financial sustainability of their authority. Public satisfaction with council services fell to 73% in 2023 – the lowest level in over a decade.

Constrained budgets

Neighbourhood services budgets, which include libraries, planning, bus subsidies, road maintenance, homelessness, public health, waste collection, disposal and recycling, are all expected to be further constrained in 2023/24 due to increases in energy, inflation and the National Living Wage. Unitary authorities and London boroughs are already reporting an 18% and 17% depletion in reserves respectively for 2023/24 as financial gaps are plugged. Local authorities also face a long-term workforce capacity problem. Between 2012 and 2023, 24% of staff were cut, and 94% of councils now report recruitment and retention challenges, particularly in planning and legal. Workforce unions have rejected a 9.42% pay increase for those on the lowest salary band, with two unions balloting for strike action. With already constrained budgets, councils will struggle to fund a higher settlement without additional resources.

In service areas, the number of homeless people increased by 26% between 2022 and 2023, while councils’ use of temporary accommodation has more than doubled since 2010 and is now at the highest level since 1998. Libraries, which have seen a 50% reduction in spending since 2009/10, saw a 68% increase in footfall between 2020/21 and 2021/22 as the pandemic lifted and more services were co-located.

Cost of living

Cost of living pressures have also increased demand, with 44% of local authorities reporting a rise in demand for food bank services and help with managing Universal Credit. The amount of waste sent for recycling remained flat at 42% in 2021/22 – the lowest level since 2011/12 – while for the fifth year in a row, incineration exceeded recycling, with 47% of waste being incinerated. The amount of biodegradable municipal waste (BMW) sent to landfill increased by 8% in 2021, despite a government target to eliminate it by 2028.

Public health shortages

In public health, councils are delivering more consultations for sexually transmitted infections (STIs) than ever, but rates of gonorrhoea and syphilis are at the highest levels since comparable records began in 2013. Shortages in health visitors mean one in five children could be missing out on health and development reviews.

Planning and maintenance backlog

Limited progress has been made in the backlogs of planning applications and road maintenance, with estimates that it will take 11 years to tackle the £24bn road repair backlog. Nine councils were told to improve their planning performance or face their cases being transferred to the Planning Inspectorate.

Given the pressures workforces, local authorities will struggle to improve service performance and address the falling satisfaction with councils and local areas.