Councils are facing massive increases in costs due to spiralling
inflation and the increase in energy costs, the Local Government
Association (LGA) are warning today.
New analysis by the LGA and the Association for Directors of
Environment, Economy, Planning and Transport (ADEPT) has
estimated that the cost of street lighting, filling potholes and
building new roads have soared, causing pressure on stretched
council budgets and delaying works.
The analysis has found that:
- Councils have seen a 37.5 per cent increase in the cost of
running and repairing street lights over the last six months,
with some authorities reporting that their running costs have
doubled.
- The cost of road maintenance has also increased, with a
number of councils seeing a 22 per cent increase in the cost of
repairing a pothole, relaying a road surface and other
maintenance costs.
- Councils capital budgets, which support the building of new
roads and other local infrastructure, have had an estimated rise
of 21 per cent, pushing up the cost of delivering investment in
local areas.
Councils are warning that global issues have had a particular
impact on costs.
Prior to the war in Ukraine, an estimated 60 per cent of bitumen,
a material used to repair roads across the country, was sourced
from Russia and sold onto the European market. Since the Russian
invasion, councils have had to ration the supply of the material
and source it from other markets, pushing up costs and delaying
road repairs.
Councils are also reporting that increasing costs for
electricity, steel, lighting and cement are all impacting on
their budgets. As well as this, areas preparing for winter have
been hit by an increase of 60 per cent in the cost of
salt.
The LGA, who represent over 350 councils in England and Wales,
are calling on the incoming Prime Minister to urgently help meet
these additional cost pressures in full as part of any new budget
measures introduced.
Local councils are already facing a significant road repair
backlog, with latest estimates suggesting it would take them 10
years and £12 billion to bring local roads up to scratch. These
increased cost pressures could risk that backlog getting longer,
with vital works having to be delayed.
Previous LGA analysis, published in June, showed
that councils were facing £3.6 billion of unforeseen extra cost
pressures onto council budgets in 2024/25 due to rising
inflation, energy costs and the cost of meeting the new National
Living Wage.
Cllr David Renard, Transport spokesperson for the LGA said:
“As this stark new analysis shows, councils across the country
are facing unprecedented increased costs to repair our local
roads, keep our street lights switched on and invest in improved
local infrastructure.
“Global pressures, such as Russia’s invasion of Ukraine, as well
as increasing inflation and a shortage of materials have all
provided the perfect storm for councils and piled pressure on
already stretched local budgets.
“To tackle this issue, the new Government must cover these
increased costs for councils or risk roads condition getting
worse or reductions in other services.
“Only with adequate long term funding – to cover increased cost
pressures and invest in local services - and the right powers,
can councils deliver for our communities, tackle the climate
emergency, and level up all parts of the country.”
Mark Kemp, President of ADEPT said:
“Current inflation rates are having a massive impact on major
capital schemes. Local authorities are doing all we can to
identify additional funding to meet rising costs, but without a
change to funding allocations from government, the funding gap
problems that lie with local councils will worsen dramatically,
increasing the risk of some schemes failing.
"Of course, it's not just major schemes. We face the same risks
and issues with other grant allocations such as Bus Service
Improvement Plans and Active Travel Schemes, where allocations
based on bids made last year will not cover the cost of delivery.
Without government support, some local authorities will have to
prioritise highways maintenance and call a halt to new
schemes."
Notes to editors
The estimates and analysis used come from a snap of survey of
around a dozen upper tier councils, as well as an analysis of
current market prices.
