Social care under threat due to rise in defence spend, warn councils
Councils may be forced to make cuts to social care budgets because of Rishi Sunak’s pledge to increase defence spending to 2.5 per cent of GDP, local government leaders have warned.
Representatives of local authorities in many “Red Wall” areas say the extra money for the armed forces risks their funds being “pared to the bone”.
The Prime Minister has ruled out scrapping plans for tax cuts and has insisted ringfenced Whitehall departments such as health and education will continue to be protected in order to fund the extra £4.5bn a year cost of putting the UK defence industry on a
“war footing”.
But experts from the Institute for Fiscal Studies said that this implied non-protected departments and public services – such as local government, prisons and further education colleges – would have their budgets cut further over the next five years.
In a separate development, official figures have revealed that the government would have spent an extra £83bn on defence between 2011 and this year if ministers had maintained Labour’s spending of 2.5 per cent.
Analysis by the House of Commons Library, seen by i, shows that the 2.5 per cent level under the last Labour government dropped to 2.36 per cent of GDP in 2011 and dipped as low as 2.03 per cent in 2015.
The lower rate over more than a decade has fuelled complaints by Conservative MPs that the armed forces have been “hollowed out” by underspending.
Mr Sunak has faced questions over how he will fund the new pledge to increase defence spending to 2.5 per cent by 2030.
The Government claims that the funding will come from diverting R&D cash and cutting the civil service headcount by 72,000.
On Wednesday the Prime Minister refused to rule out cutting spending in non-protected Whitehall departments to meet the pledge.
Graham Chapman, vice chairman of the Special Interest Group of Municipal Authorities (Sigoma), which represents urban areas in northern England, the Midlands and the south coast, said the axe was likely to fall on adult and children’s social care. Councils are already facing a funding squeeze from central government after Jeremy Hunt announced in his Budget last month that growth in local government spending would be maintained at 1 per cent a year.
Mr Chapman, a Labour councillor in Nottingham, told i that the defence spending increase means council finance chiefs have “nowhere else to go” as they try to balance the books.
Several councils in England have already declared technical bankruptcy – using Section 114 notices – because of funding squeezes, and Mr Chapman warned that the defence uplift would mean more town halls following suit.
“This is just going to add more agony to that,” he said. “What they need to understand is that the services most vulnerable to cuts are where all the pressure is – adult social care and children in care.”
Mr Chapman described Mr Sunak’s announcement as “half-baked” but added: “If there were any substance to it, then we are already planning for a 4 per cent reduction in local government funding, a realterms reduction of 4 per cent, over the next four years.”