Category Archives: public record

Four out of every five councils across England, Scotland and Wales are still struggling to balance their books despite modest improvements in local government finances as UNISON’s research reveals a funding gap of almost £4bn – and it’s predicted to rise to over £7bn – as the true scale of local government’s difficulties is masked.

The union’s annual report into council finances, Bridging the Gap, analyses responses to freedom of information requests and financial plans from 368 local authorities. It shows councils are forecasting a combined funding gap of almost £4bn in 2027/28, rising to £7.1bn by the following year. This compares with a predicted funding gap of £4.1bn last year.

A funding gap is the difference between what a council needs to continue providing its current services and what it actually receives.

UNISON says that recent central government settlements have helped ease some of the immediate financial pressures facing councils after more than a decade of austerity.

But fast-rising demand for services such as adult social care, special educational needs and disabilities (Send) and housing, increasing costs and the long-term legacy of underfunding mean most councils still lack the resources needed to restore services and rebuild financial resilience.

Scale of difficulties masked

The union’s report also warns that Whitehall’s growing use of exceptional financial support, which is designed to assist councils facing severe financial challenges, is masking the true scale of the sector’s difficulties.

For example, Birmingham City Council is not forecasting a funding gap in 2027/28 despite declaring itself effectively bankrupt in 2023. UNISON said this illustrates how exceptional funding support can improve a council’s immediate budget position without resolving underlying problems.

At least 35 councils required more than £1.5bn of emergency support in 2026/27 to help them set balanced budgets – a legal requirement. But emergency support often involves council borrowing, which needs to be repaid.

UNISON’s research identifies London as the region facing the largest collective funding gap (£851m), followed by the South East (£785m). It also highlights significant financial pressures in Scotland (£538m) and Wales (£269m).

The report comes as the government has paused much of its council reorganisation programme.

The union said that local authorities need greater certainty over their future funding and structures to plan services and support communities effectively.

‘Stabilisation isn’t recovery’

UNISON general secretary Andrea Egan said: “The figures suggest councils are moving in the right direction, but stabilisation isn’t recovery.

“Four out of five local authorities are struggling to balance the books, and there’s still a predicted £4bn black hole in local government’s finances next year.

“Prime minister Andy Burnham’s government has rightly put devolution and stronger local services at the centre of plans for national renewal.

“Councils now need certainty about their future and the long-term funding to invest in prevention and support workers delivering services.

“Staff have experienced years of pay restraint while helping communities through austerity, the pandemic and the cost of living crisis.

“Fair pay for staff and sustainable funding for local government are not competing priorities. Councils need both if they’re to recruit and retain the skilled workforce communities depend on.”

The Employment Rights Act is a welcome shift towards stronger workers’ rights. After years of insecurity and erosion of standards, it shows the tide is finally turning.

But for far too many workers, especially those delivering public services under private contracts, this does not go far enough – or fast enough.

Before taking office, the government promised the biggest wave of insourcing this country has ever seen. That promise raised real hope among workers trapped in outsourced, insecure jobs. Yet months later, many are still waiting to see delivery.

“Insourcing changed everything”

For those who have been brought back in‑house, the difference is stark. Chris Akaluka, Branch Secretary for Barts Health has first-hand experience of being insourced – and is taking that experience to government. Thousands of his colleagues have seen the benefit.

Chris said: “Being insourced changed everything. We finally had job security, proper sick pay and a voice at work. It wasn’t just better for us – it meant we could do the job properly, without cutting corners or worrying about what would happen when the contract changed again.”

That is why UNISON is backing the TUC’s campaign ‘Our work matters’, calling on Labour to honour its pledge and bring services – and the people who deliver them – back in‑house.

Over 20,000 people have signed the online record of support – which Chris and colleagues from other trade unions have handed to Cabinet Office Minister Chris Ward at a TUC Roundtable.

For outsourced workers, delay has real consequences. Many face a two‑tier workforce, doing the same jobs as directly employed colleagues but with fewer rights, weaker sick pay and less security. High turnover and short‑term contracts are often used to avoid responsibilities.

The Employment Rights Act begins to address this. Day‑one rights, improved statutory sick pay and stronger redundancy protections all matter – especially for low‑paid workers in cleaning, care, water services and facilities management. No one should be forced to choose between going to work sick or losing pay – or losing their job.

Outsourcing itself remains the problem

But without insourcing, insecurity is baked into the system. Contracts change hands, workers’ conditions erode and experience is lost. Insourcing is the only way to end the two‑tier workforce and make decent, secure work the norm.

More employment reforms are expected later this year. They must be matched with urgent action on insourcing. Warm words are not enough. Workers need delivery.

Making work pay must also mean making work fair – and that means acting now.

Legislation alone does not change workplaces. Workers and unions coming together to organise can deliver real change. These new rights will only be as strong as our ability to enforce them. That means:

• Recruiting and organising in contracted workplaces
• Negotiating to ensure employers go beyond the legal minimum
• Challenging bad practice wherever it persists.

For members working for private contractors, this is a moment of opportunity. Every gain we make in law must be defended – and built upon – in the workplace.

UNISON will be at the forefront of making sure these changes deliver – not just in principle, but in practice.

Because making work pay must also mean making work fair for everyone – wherever you work and whatever you do.

By national secretary for business, community and environment Donna Rowe-Merriman