London Councils has warned that the Autumn Statement will leave boroughs facing massive financial pressures, with many struggling to balance their budgets this year.
Although the cross-party group welcomed the government’s decision to end the freeze on Local Housing Allowance (LHA) rates, London Councils says the capital’s homelessness crisis and wider pressures on social care will remain a “critical risk” to town hall finances across the capital.
Overall, the measures announced by the Chancellor today are not expected to significantly alter London Councils’ forecast of a £600m shortfall in boroughs’ budgets this year, brought about by skyrocketing demand for services, spiralling inflation, and insufficient government funding.
Cllr Claire Holland, Acting Chair of London Councils, said:
“Boroughs will continue to face massive budget pressures. Many are struggling to balance their budgets and the Autumn Statement leaves them teetering on the edge.
“London’s homelessness emergency is a key concern. After years of campaigning for an increase in Local Housing Allowance, we welcome the decision to end the freeze. Boosting LHA is essential for helping low-income Londoners pay their rent and avoid homelessness. This is good news for London renters and for boroughs’ hard-pressed homelessness services.
“But with one in 50 Londoners currently homeless and living in temporary accommodation arranged by their local borough, the housing crisis remains a critical risk to town hall budgets. Enormous and growing pressures can also be seen across other vital services, especially adult and children’s social care.
“We will keep pushing for more funding support in the face of these on-going challenges, as well as the long-term reforms to local government finance that are crucial for sustaining London’s local services in the years to come.”