Study examines impact of local authority budget cuts on election results

Cuts to local authority budgets in England are disproportionately affecting councils in the North and those in the most deprived areas, according to a new report by the Sheffield Political Economy Research Institute (SPERI).

Evidence on spending cuts shows that councils in the North West have experienced an average cut of £234.76 per person, followed by an average cut for councils in Yorkshire of £197.24 per person and an average cut for councils in the North East of £189.16.

The average across England is £130.06 per person. Councils in the South East have experienced the lowest average cut, at £74.08 per person.

The study found the most deprived local authority areas have experienced the most significant cuts. Councils in the top 10 per cent most deprived areas have seen an average cut of £228.23 per person. In contrast, councils in the top 10 per cent of least deprived areas have seen an average cut of only £44.91 per person.

The SPERI report also looked at the political composition of local authorities. Researchers found councils controlled by Labour have been most affected by reductions in local authority spending power, with an average cut of £160.08 per person. In contrast, councils controlled by the Conservative Party have seen an average £68.95 cut, and councils controlled by the Liberal Democrats have seen an average £75.91 cut.

The report also considers how the recent local elections held in England might have been affected by the differential experience of spending cuts. For instance, the councils lost by the Conservative Party in May tend to have experienced a much higher cut than typical Conservative councils.

The councils where UKIP made significant gains have experienced an average cut of £106.45, that is, significantly below the average cut across England. Two-thirds of UKIP's major successes came in Labour-controlled councils, albeit atypical councils that have experienced significantly lower cuts than the Labour average.

Dr Craig Berry, SPERI Research Fellow and co-author of the report, said: "There is a clear pattern to the cuts experienced by local authorities in England, with councils in the North, in more deprived areas, or controlled by Labour have seen more significant reductions in spending power than those in the South, in more affluent areas, or controlled by the Conservatives or Liberal Democrats.

"Of course, the significant overlaps between these categories should be acknowledged. It is impossible to say the coalition has focused spending cuts on Northern or Labour-controlled councils. Rather, they have failed to protect deprivation-related local spending, meaning that the councils which previously had higher budgets due to higher levels of deprivation have seen the largest cuts.

"The extent to which the 2014 local elections were influenced by pattern is not clear, although it is apparent that the Conservatives' losses were concentrated in areas that have not been shielded from the cuts to the same extent as Conservative councils in general.

"The concentration of UKIP's recent success in Labour areas has been well-documented. What is now becoming clearer, however, is that it is succeeding in atypical Labour areas which have experienced relatively low spending cuts."

Today's publication is the sixth in a new series of SPERI British Political Economy Briefs. Through this series SPERI hopes to draw upon the expertise of its academic researchers to influence the debate in the UK on sustainable economic recovery.