Councils in England are in dire straits, facing a £5 billion deficit primarily in special educational needs spending, according to a public accounts committee inquiry. This looming financial crisis threatens council insolvency, prompting calls for immediate government action. With a statutory override allowing councils to sidestep high needs deficits set to expire in March 2026, concerns mount around the future of local government finances. The committee urges collaboration among government departments to develop a sustainable financial solution, while local government leaders demand clarity on how these mounting deficits will be addressed.
Sir Geoffrey Clifton-Brown, the PAC's chair, stated that the government's inaction suggests it is comfortable with the current state of local authority finances, perceiving issues as normalized.
The inquiry revealed that the government must provide immediate clarity on addressing rising high needs deficits, expected to reach £5 billion next year.
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