LGIU Response: Spring Statement 2025

Dr Jonathan Carr-West, Chief Executive, Local Government Information Unit (LGIU), said:

“Today’s Spring Statement was largely concerned with macroeconomic issues – the top notes of which focused on defence, welfare and public sector reform. But, at LGIU, we know that much of what was announced today will have a potentially significant impact on local authorities and the communities they serve.

“The halving of the health-related part of universal credit was already known, but the fact that this reduced provision will then be frozen for the rest of the parliamentary term is news. A large number of the most vulnerable people in our communities will be impacted by these cuts – the DWP estimates up to 3.2 million families. Inevitably – it will be councils that will have to find the resources to support them and pick up the pieces, putting further strain on already stretched council budgets.

“However, there were some bright spots for councils. Several areas and local authorities will receive boosts to their local economies – thanks to the large increase in defence spending. This is to be hugely welcomed for those regions. Likewise the OBR’s projection that we are on track for 1.3 million of the promised 1.5 million houses by the end of the parliamentary term is very positive news.

“Housing, planning and skills are foundational for local government, so it was good to hear them feature prominently in the Chancellor’s speech. However, it was not clear how central councils actually are in the Chancellor’s plans for delivery, which is very concerning. These are policies that can only be successful if they are designed and delivered to fit local circumstances and that can only be done in partnership with local government.

“From a local government perspective, the elephant in the room today was the fact that the shape of local governance is changing and changing fast with the introduction of mayoral strategic authorities and local government reorganisation. There was no indication anywhere in today’s Statement of a connection between the measures announced and the proposals – already well in train – for devolution and reorganisation.

“The Chancellor left a great many questions deferred for local government – with councils left waiting for the answers.”