‘Levelling down London’: Hackney politicians admonish government over delays to funding reforms – with ‘frontline services at risk’

A fourth successive one-year funding agreement drawn up by the government for Hackney Council has come in for heavy criticism from local leaders.

Councils have historically received multi-year funding settlements which allow them to plan their services into the future.

However, the government is in the process of drawing up controversial plans to reform local government funding in what is known as the ‘Fair Funding Review’ – delays to which have meant that interim agreements have had to be drawn up.

The review will reset how local government funds are awarded, with critics suggesting that the process will divert funding away from areas with high deprivation and need.

It could result in sizeable long-term cuts to councils such as Hackney.

Mayor Philip Glanville, Deputy Mayor Anntoinette Bramble and finance chief Cllr Rob Chapman wrote in a letter to Levelling Up Secretary Michael Gove that it is “impossible to level up the country while levelling down London – especially when it comes to the funding of vital public services”.

The trio added: “The government should now provide clarity on which local government funding reforms will happen and when as well as how consultation and engagement with the sector will take place.

“The government must ensure that overall local government funding is sufficient when any funding distribution changes are introduced and that no council sees its funding reduced as a result.”

They said: “While funding reforms make it difficult for a government to set out a multi-year settlement for local government, this is the fourth one-year settlement in a row for councils which continues to hamper financial planning and their financial sustainability.”

Whitehall’s Local Government Finance Settlement, which allocates the annual funds, has set out Hackney’s budget for 2022/23 already. However, the council does not believe that the amount of money made available is sufficient to cover the cost of services tacking vital problems in the borough, such as social care and homelessness, or the ongoing cost of the pandemic.

A Department of Levelling Up, Housing and Communities (DLUHC) spokesperson told the Citizen: “We are giving councils the resources they need to maintain and improve their services, with an additional £3.5 billion being made available.

“For Hackney, this represents an above-average increase of up to 7.1 per cent compared to last year, worth £19.7 million – giving a total core spending power of up to £295.7 million.”

The department also made clear that this year’s round of funding included an £822 million services grant, which councils were able to spend as they see fit.

The DLUHC says it plans to work closely with local partners to understand the unique challenges and opportunities they face before consulting on any potential funding reform.

A full council meeting will be held in March, during which Hackney’s budget will be discussed.