Media release: Vulnerable Londoners to continue to miss out on vital government funding

Services for vulnerable Londoners will continue to miss out on millions of pounds of vital funding, London Councils warned today. 

The warning comes as the government launches a consultation on the formula and data it intends to use to allocate funding to local authorities between 2008/09 and 2010/11.

London boroughs are already disadvantaged by the changes the government made to the formula in 2005. These adverse changes left authorities in the capital facing potential losses of nearly £350 million for services for vulnerable children and adults.

Last year, the capital's councils and schools also missed out on more than £180 million of specific grant funding because the money distributed by the government failed to take account of the capital's extra staffing costs.

The government's announcement coincides with the publication of a series of booklets, by London Councils highlighting the wide-ranging pressures faced by London's boroughs, and the impact of changes to the formulae and data on the allocation of council funding.

The Fairer Funding for Councils pack outlines London Councils' concerns that a combination of flawed formulae and poor quality statistical data means the capital's diverse and complex needs will not be reflected in the amount of funding councils receive.

As a result, some of the most vulnerable Londoners may miss out on the services they need at a time when councils in the capital are already supporting more vulnerable people than they are receiving funding for.

The pack also highlights that the Office for National Statistics is intending to cut over 60,000 people from its estimate of the capital's population. This also will impact on council funding because population is one of the major factors deciding the level of grants allocated to local authorities.

Because of the scale of potential losses, the government currently protects councils from massive funding cuts by 'damping' the impact of the formulae.  This results in the majority of London councils receiving the minimum increase in government grant.

Today London Councils is calling on the government to ensure that it provides fair funding to all of the capital's councils by providing sufficient resources to meet the needs of their local communities.