George Osborne dealt a devastating blow to poorer councils in the Autumn Statement when he confirmed a 56 per cent funding cut from the Department for Communities and Local Government’s central grant – with 100 per cent business rates retention expected to fill the void. Prosperous areas will welcome the move, being phased in by 2020, but the Chancellor is heaping pressure on struggling councils that will find it hard to attract ratepayers to balance their books. Furthermore, the measures do nothing to address the existing postcode lottery that has left some services relatively untouched, while others struggle with just one trading standards officer. The great irony is that trading standards support is often the only form of business support afforded by local councils, and a robust service is essential to create the conditions for local economies to thrive. Spending a mere £130m on all local authority trading standards services – with about another £15 million for other consumer protection projects, including National Trading Standards – was questionable before the Chancellor’s announcement. Intellectual property theft costs the UK economy £1.3bn, mass marketing scams cost their – often elderly – victims more than £5bn annually, and the 2001 foot and mouth outbreak alone cost the economy £8bn. These huge sums account for just a fraction of the growing number of statutory trading standards duties and do not illustrate the human cost of weakened regulatory services. Elderly scam victims are more than twice as likely to need full-Cash-strapped councils reveal the true extent of George Osborne’s austerity programme on public services. TS Today reports time care; BSE – that infected three million animals – spread to 200 people, and habitual smokers who started as children reduce their live expectancy by an average of 10 years. If councils are to stand any chance of discharging the huge responsibility of self-funding, they must be properly resourced, and the government must act to reverse the rot before trading standards becomes entrenched in the status quo. Councils have been warning for some time that they are running out of cash to carry out their statutory duties, putting the very nature of local authorities under threat. Lancashire County Council is one of the latest authorities to warn that, from April 2018, it will have run out of money to operate its statutory services. According to a cabinet report that was due to be discussed by councillors at the end of November: ‘The county council is facing an unprecedented financial challenge’. It goes on: ‘It is clear that the county council, in its present form, is not a financially sustainable organisation in the medium term.’ The authority is proposing that external consultants be appointed in the new year to help it review its operating model. The report says: ‘From April 2018 the council will not have sufficient financial resources to meet its statutory obligations.’ From 2016, Lancashire will need to rely heavily on its reserves to balance the books. By 2021, the council predicts it will have an overall financial shortfall of £262m – on top of other cuts that have already been confirmed. The shortfalls are a combination of: the government’s continued austerity programme; significant increases in costs, such as inflation and the new national living wage; an increase in demand for services; and £53.2m worth of savings that had previously been identified and were later found to be undeliverable. Lancashire Trading Standards is already facing a cut of £416,000 this year, but the council is proposing more ‘operation efficiencies’, with a ‘proposed further staffing reduction’ to find another £48,000 of savings in 2016-17. To achieve this, the entire trading standards service will need to be reconfigured from April 2016. The authority is proposing to consult with its staff on the revised structure by 31 December 2015. Health and social care services in Lancashire are forecast to have a budget shortfall of £800m by 2020/21, and the authority acknowledges that local police and fire services are faced with significant budget constraints, too. Facing similar cuts to its own trading standards service, Worcestershire County Council voted in November to take the service and animal health functions back under council control, after fears that further cuts could lead to a legal challenge, reputational harm and an inability to deal with a disease outbreak. Worcestershire Trading Standards was taken over by Worcestershire Shared Services, a spin-off organisation set up in June 2010 to deliver shared regulatory services across the county. However, changing needs among the seven councils involved led to proposals to cut £360,000 from the existing trading standards budget, taking it to just £450,000 in 2016/17. If this had gone ahead, its trading standards officers would have been cut from 11 to 7.5 full-time employees (fte). In 2013, Audit Scotland strongly suggested that a small trading standards service needed a minimum of eight full-time employees to meet statutory duties. This stance appears to have been acknowledged by the authority, which stated in its report: ‘Staffing levels for county functions (estimated 7.5fte) would carry a high risk of not being considered as sufficient to fulfil the county council’s statutory duties.’ To preserve staffing levels, Worcestershire County Council is proposing to use its funding reserves in 2016-17 to prevent redundancies while the service is taken back in-house. Liverpool resident Stephanie Hudson, who launched judicial review proceedings against Liverpool Council earlier this year, was delighted by Worcestershire’s decision. She said: ‘Clearly someone has realised how necessary trading standards is, and how important. Someone’s realised they wouldn’t be able to cope with any emergencies without them.’ Hudson believes that her legal action in Liverpool, and the embarrassment this has caused for the authority, impacted upon Worcestershire’s decision. She says: ‘You don’t want your citizens taking action against you because they feel they’re not being protected, or the council’s not doing what’s legally required of it.’ The realisation that local politicians won’t be able to secure enough votes to win at the next district council elections is also beginning to play a part, believes Hudson. In Liverpool, the fight continues after the council slashed its trading standards service from 19 to four, following a ‘flawed’ consultation process in 2014. Hudson, a former trading standards officer with the authority, presented the authority with her own restructure plan during the consultation process – which cut her own job from the service – but she felt it was never seriously considered. Following the council’s decision to press ahead with its original plan, and fearing that the authority would be unable to meet its statutory duties, Hudson initiated judicial review proceedings in what she saw as a bid to help keep Liverpool residents safe. In May, Manchester High Court served Liverpool Council with an undertaking to review the decision it had taken to restructure its trading standards and consumer protection service, having regard to its statutory duties under European law and the UK government’s list of regulatory priorities. The review, published on Liverpool City Council’s website in August, contains limited analysis of the capacity of the restructured service, and CTSI is taking legal advice on next steps. Earlier this year, Derby City Council was one of the first authorities to reveal that its ability to carry out statutory duties were in jeopardy, with the authority facing £49m of cuts by 2018/19. It can afford to make only £33m of cuts before statutory obligations cannot be fulfilled. At that time, council leader Ranjit Banwait told a local paper: ‘We have already managed to make record savings of £116m in Derby, but we are now faced with is a situation that would leave the council with a budget shortfall of £16m. That total is the absolute limit of what we can cut from our budget and still comply with the law.’ TS Today understands that Derby is now considering reducing its food safety budget by 18 per cent, and has warned it may not be able to sustain its overall statutory responsibilities. It is hoped that the government’s own review into trading standards by the Department of Business, Innovation and Skills – instigated last summer when CTSI proposed a restructure of the service – will have impressed upon it the importance of the service. Time alone will tell.