Council leaders voice post-Brexit regeneration funding fears

Almost three quarters of senior local government leaders do not think Westminster will reshape regional regeneration funds after Brexit, according to a new report.

PwC’s annual The Local State We’re In survey of council chief executives, finance directors and leaders shows 74% are not confident central government will engage with local government in reshaping regional investment and regeneration funds after Britain leaves the EU.

And only 12% of those surveyed believe their council is proactively promoting overseas links to find investment and promote trade for their local economies.

Almost three quarters (72%) of those surveyed said a lack of investment in infrastructure was a key barrier to place-based growth in their area, while 61% identified a lack of influence over skills and 60% said a lack of affordable or suitable housing was also holding back growth.

The survey also revealed a growing feeling among local government leaders that devolution has stalled, with only 13% of council leaders predicting their council will have more powers and responsibilities in 2022.

And following the recent publicity around Northamptonshire County Council’s financial problems, the survey also highlighted ongoing concerns about money, with 74% of respondents predicting more councils will get into serious financial crisis in the next year.

The PwC report also surveyed the public on its views on local government and revealed the impact of Brexit is still a source of uncertainty, with 46% of the public neither agreeing or disagreeing that their local area will benefit from leaving the EU.

‘This year’s survey shows the significant step up in the challenge for local government leadership in securing the future for their councils, as well as ensuring they are financially sustainable,’ said PwC’s local government and health leader, Jonathan House.

‘While local councils have done well against an ongoing course of challenges, the cliff edge for some is getting ever closer.

‘With another Spending Review next year, as well as the UK’s formal exit from the EU, the landscape will become incredibly tough – the resilience they have shown so far will be tested to the max,” added Mr House.

But local government leaders also said new technology presents opportunities which extend beyond just reducing costs with nine in 10 respondents expecting that digital will enable them to engage communities in new ways, while 80% expect digital to facilitate improvements to service delivery. However, there are challenges to deliver this with just three in 10 survey respondents feeling that their council is confidently embracing new technologies like AI and robotics.

‘The findings highlight the need for councils to further embrace technology to fully take advantage of the benefits it can bring to delivering improved outcomes,’ added Mr House.

‘Furthermore, while the capability gap for data analytics is closing, more needs to be done to drive insight from the vast amount of data collected, enabling earlier intervention and prevention to deliver better results for citizens.

‘With Brexit looming, and only 12% of respondents saying their councils are proactively going abroad on a city-to-city basis to find investment and develop trading links now is the time for action. This is particularly important given that 74% are not confident that central government will engage with cities and local government in reshaping regional investment and regeneration funds beyond Brexit,’ added Mr House.