"There is undoubtedly fat to be trimmed from councils."
These were the words of local government minister Paul Scully during last week's Conservative Party Conference. They came as a surprise to some - particularly those who have worked in local government over the past decade or so.
The minister's comments at a conference fringe event appear to be paving the way for public service budget cuts from the government. New Prime Minister Liz Truss and Chancellor Kwasi Kwarteng have sparked economic turmoil with their budget plans and there fear is they will use cuts to public services to try and balance the books.
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The Treasury has already written to all government departments telling them to deliver proposals for 'efficiency savings', for those who have endured a decade of austerity in local government, the question will be, where is left to cut?
We have taken a look at councils across Merseyside to assess their current financial predicament and see how leaders feel about the prospect of the government taking another axe to their coffers.
Liverpool
Liverpool Council knows a thing or two about austerity. Since the coalition government came to power in 2010, the council has faced enormous cuts to its budgets.
Since 2010, Liverpool Council has lost 65% of its core funding - around £465m in 12 years and had to lose around 3,000 staff. and is facing cutting its cloth even further when it sets a budget for 2023/24, before any further funding decisions from government.
Mayor Joanne Anderson said any possible reduction in government support would hit those earning the least the hardest. She said: “ “In the throes of a cost-of-living crisis, the Tories have signalled that billions need to be cut from public services in order to fund their proposed tax cuts.
“At a time when councils are chronically underfunded and people are having to choose whether to heat or eat, these cuts promise to hit the poorest hardest. Earlier this year, Liverpool Council had to raise its council tax by almost 3% and introduce a £40 annual green bin charge as a way to generate millions of pounds.
Mayor Anderson said a further £58m needs to be found during the next budget setting process. She added: “This year alone, Liverpool City Council has provided additional support to thousands of residents in need. We have made over 5,000 discretionary housing payments, and paid out £2.1million through our Citizens Support Scheme.
“This is all to the backdrop of having to find budget savings of £58million over the next year. Further cuts would exacerbate this problem and lead to a reduction in vital services.” Despite the warnings from Conservative ministers, Mayor Anderson stressed the need for collaborative working, rather than council and government being adversarial.
She said: “We urgently need a reset between local and national government and for them to work with us rather than against us.”
Wirral
The situation facing Wirral Council scarcely be more serious.
The council, which has suffered hundreds of millions of pounds in budget cuts over the past decade, recently revealed that its deficit has ballooned to nearly £50m amid soaring inflation and growing costs for providing services. That figure was just £14m a year ago.
Top council officials told a meeting this week that the authority must now 'prepare for the worst' and will now speak to residents about where it may have to cut next. It is thought Domestic abuse support could be among the services to be cut
Director of Resources Shaer Halewood said the scale of the situation was so huge that targets will not be set and a second round of proposed cuts will be put to the committee in November.
Ms Williamson said: "Like most councils, if we are not given adequate funding to get us through our budget, we won't be able to deliver anything other than statutory services."
Rather than further government-ordered cuts, Wirral Council is preparing to vote on a request for a Whitehall bail-out as it struggles to keep its head above water.
Sefton
In Sefton, 51%, or nearly £250m in government funding was cut from the local authority over the past 12 years. Although the council's most recent budget looked set to balance, recent financial pressures including huge rises in energy bills and payroll costs has left the council struggling to plug a £8m budget black hole.
When the most recent funding settlement was revealed in November last year amid claims by then chancellor Rishi Sunak of an "end to austerity" Sefton Council leader cllr Ian Maher warned the government was passing on a burden to local taxpayers that was unsustainable.
In an open letter to the government at the time Cllr Maher said: “While the Government will, no doubt, claim it is increasing funding for Sefton and other local Councils, the burden continues to be passed to tax-payers.
"This means the Borough’s residents are paying for those increases out of their own pockets at the same time as they face rocketing household fuel bills and rising prices in the shops.”
The question remains how local authorities like Sefton, struggling as they are with the small increase in funding brought about in the past financial year will fare going forward if more cuts are on the table.
Knowsley
Knowsley Council found itself in the "enviable" position earlier this year of having a small budget surplus and no cuts after years of efficiency savings and cuts. During the past decade, the council had around £100m slashed from its funding, working out at just under £500 for every resident in the borough.
But Cllr Graham Morgan said the current financial situation is "without doubt" one of the council's "most pressing concerns".
Speaking to the LDRS, Cllr Morgan said: "The noises from this latest version of the Tory Government are not giving us any confidence that they even understand the challenges we are facing – let alone have a plan to help us face them.
"Over the last decade or so, we have had to cope with ten years of austerity cuts, followed by the huge impact of the COVID-19 pandemic. Now we face the cost of living crisis and rising inflation, the likes of which we have not seen for decades."
He added: "And if that wasn’t hard enough, the situation has been made even worse by the recent catastrophic decisions taken by the new Prime Minister and Chancellor of the Exchequer. It’s unbelievable that they are now asking us to consider the very real prospect of further cuts to public spending."
Cllr Morgan pointed to new funding calculations for adult social care which he said could leave funding fall "way short of what we need to support vulnerable residents" in addition to missing out on recent Levelling up Funds.
He said: "How can that be fair?", adding: "It feels like our funding is already only moving in one direction and that’s not a positive one."
Calling on the government to "try and understanding the challenges" the borough is facing Cllr Morgan said he has written to the government to ask for a review of settlement figures but is yet to have received a response.
He said: " In the meantime this Council will continue to support its residents – as always – but we need fair and appropriate central Government funding to help us to do that.”
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