Tory council's warning to No 10 as it faces threat of 'financial meltdown'

One of the UK's largest Conservative-run councils has warned it faces "financial meltdown" and has called on ministers to fix the "broken" local government funding system to avoid it and many other authorities plunging into effective bankruptcy.

- Patrick Butler

Hampshire county council said without an overhaul of council finances in England - which it admitted was unlikely to come in time to prevent cuts - it would be forced to push ahead with drastic reductions to the local services it provides over the next 18 months, and could face insolvency by 2026.

The council has to find £132m by April 2025 to help fill a widening budget gap but has warned it cannot rely on cuts and council tax rises alone to balance the books without ditching "safe" levels of core service.

A report prepared for a meeting of the council's cabinet next week states that "these are not problems we can fix on our own and that the government must intervene if we and the whole of the local government sector are to avoid financial meltdown".

Hampshire hit the headlines last year after publishing a joint letter with Kent county council to Rishi Sunak warning that failure to properly fund local government in England would see the two councils "sleepwalk into financial disaster".