One of the country's largest councils has written to Chancellor Jeremy Hunt to warn that without government help it faces bankruptcy within two years.
Kent County Council leader Roger Gough, along with the leader of Hampshire County Council, outline the drastic budget implications facing the two authorities in a letter that says they need “immediate help and a clear plan for long-term financial sustainability, if the two county councils are to avoid filing bankruptcy notices within the next year or so”.
Cllr Gough said: “The problem is simple, the extra money we can raise from council tax and business rates barely covers our normal costs of inflation each year.
"This leaves major growth, particularly in adult and child social care, totally unfunded. This is not a medium-term problem that can be fixed with more one-off handouts to keep the sector limping along, it needs fundamental changes to the whole system of local government funding.
"Without a major change either in the way these two services are funded, or in our legal obligations, I suspect that large parts of upper tier local government will face collapse.”
“We fully recognise the difficult national economic environment, but the time has come for urgent, meaningful dialogue with Ministers, our MPs and government officials before the end of this year.
"We have a responsibility to the residents of Kent and Hampshire to do everything possible to protect the future of their important local services.”
In their letter, the two leaders state: “We are writing to you now because without some immediate help and a clear plan for long term financial sustainability we are likely to be considering Section 114 notices within the next year or so."
That would mean the authority funding only those statutory services it was required to and no new funding would be authorised.
Only a few months ago, KCC launched a public consultation on its budget for 2023-24 with a warning that it faced significant challenges, saying: "The long-term impact of the Covid-19 pandemic on some of our services and the impact from rising inflation on council spending in 2022-23 and future years remains unclear.
"This means that forecasting future spending and income is much harder than we have been used to in previous years."
Kent County Council has already warned that it faces a spending gap of at least £60m next year.