Key Cities’ Leaders’ Survey finds that despite new optimism, leaders across the UK need more power and resources to stabilise local government. City leaders from across the country will be prioritising service redesign and using financial reserves to combat the ongoing financial crisis in municipal government.

The findings have been revealed by Key Cities, a national cross-party network representing around 10% of the UK’s population, in its inaugural survey canvassing the opinions of the council leaders of its 24 member cities across England and Wales.

Overall, three in five (60%) city leaders highlighted service redesign and utilising financial reserves as their highest priority for the coming twelve months. Two in five (40%) also pointed to selling off council assets and reducing non-statutory services as their priority. One in five (20%) identified redundancies and salary reductions as a priority.

Earlier this year, the Key Cities Manifesto called for additional funding, reform and ringfencing of social care budgets to protect council finances. Social care and the housing crisis continue to force local authorities into difficult financial decisions. The top three most significant financial pressure points facing Leaders over the next twelve months are adult social care (33.3%), children’s social care (26.7%) and homelessness (26.7%).

Councillor Millie Earl, Leader of Bournemouth Christchurch Poole Council, said “Our greatest financial challenge is Special Educational Needs and Disability Service pertaining to the High Needs Block of the Dedicated Schools Grant. Like many local authorities, a change in legislation, and a financial solution from government is essential to our ability to continue delivering local services.”

Despite the difficult circumstances, a third of leaders do not wish to see the introduction of a Mayoral Combined Authority in their area, as per the current and previous government’s approach to devolution. Leaders gave a variety of reasons why, including: perceived difficulty in getting separate local authorities to agree to an elected mayor; concerns around loss of political influence; and a lack of clarity on the benefits that the mayoral approach will bring.

Only a quarter (25%) of those who are not already part of a combined authority would like to move to that model of local government.

In addition, the results provide a snapshot of priorities for funding allocations across the UK following the change in administration. The findings were as below:

• Over half of the respondents believe that an increase in central government grant funding should be the main priority for the next twelve months, in relation to local government. (53.3%)
• Leaders believe that net zero should be made statutory (33.3%), followed by economic development (26.7%) and leisure and sport (20%). The Key Cities Manifesto called for new regulations to give local authorities powers to create net zero investment ecosystems based on local needs.
• Most Leaders (86.7%) are not aware that the UK councils can participate in Horizon Europe, the EU’s key funding programme for research and innovation until 2027.

Cllr John Merry, Chair of Key Cities and Deputy Mayor of Salford City Council, said:

“Whilst we have become a more optimistic group since the General Election, the realities we face remain stark. Difficult decisions still need to be taken simply to deliver regular services. It gives me no pleasure to see so many colleagues considering the sale of assets and redundances and relying on dwindling financial reserves, among other measures, to stay financially afloat.

“I believe our first Leaders’ Survey has come at a great time. As we are working under no illusions but with a renewed sense of collaboration and direction, I can understand our collective optimism and enthusiasm. Some of the calls from our manifesto, such as the reinstatement of housebuilding targets, have been immediately met. Together, with support from central government, we can work out the solutions best tailored for each city to achieve nationwide resilience and prosperity.

“As we set out to achieve this, it is important to remember that each city represents varying geographical sizes, characteristics and spending priorities. There is no one-size-fits-all approach when it comes to devolution where more bespoke approaches may be required.”