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Over recent months, you may have seen local authorities warning that they are facing a funding crisis. Since 2021, six local authorities have declared themselves effectively bankrupt, and many other local authorities have reported that they may soon be forced to do the same.
How did we end up here? Why are local councils facing funding pressures? And what can government do to help them?
Joining us to answer these questions are Tony Travers, a professor in the Department of Government at LSE and expert on local government, and David Phillips, Head of Devolved and Local Government Finance at IFS.
Zooming In: discussion questions
Every week, we share a set of questions designed for A Level economics students to discuss, written by teacher Will Haines.
1. Between 2010-2015, why did local councils have to cut spending despite there being no cut to council tax?
2. One of the guests mentions that local councils have monopsony power over adult social care providers, whilst children's social care providers have monopoly power over local councils. Define these two terms and explain the possible impact on prices.
3. How would you structure council tax so that it is fair and generates sufficient revenue for local councils to fund their expenditure?
Host
Paul Johnson
Paul has been the Director of the IFS since 2011. He is also currently visiting professor in the Department of Economics at University College London.
Participants
David Phillips
David is Head of Devolved and Local Government Finance. He also works on tax in developing countries as part of our TaxDev centre.
Tony Travers
Tony Travers is a Visiting Professor in LSE Department of Government and Director of LSE London. His key research interests include local and regional government, elections and public service reform. Professor Travers' knowledge is frequently sought by policy makers and he has advised a range of select committees and think tanks. He also provides expert analysis for broadcast and print media, regularly appearing on major television and radio networks.
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