London councils 'planning for £5bn cuts by 2014'

Councils in London on average are preparing cut their budget by 24% over three years, BBC London has learned.

The 32 local authorities currently spend a total of £22bn and if that is reduced by 24%, about £5bn will be cut from the budget by 2014.

This would see jobs go in at least 17 councils and services reduced.

Meanwhile, a BBC-commissioned study by Experian found some areas of London are more resilient than others to economic shocks.

A survey by London Councils, accessed by BBC London, questioned treasurers at 32 boroughs and found that they are expecting to have to make an average of 24% cuts by 2014.

The savings range from 9% for outer London to as much as 34% in inner London.

'Very hard choices'

Tony Travers, director of the Greater London Group at London School of Economics, said: "Many are already preparing for cuts of around 25% to their budgets and that will mean some very hard choices.

"I think the total cuts for London's councils could quite easily be between £2bn and £3bn in the coming three years."

BBC London also asked for spending cuts figures from the 32 boroughs, of which 22 responded.

Of them, 19 said they were expecting total cuts of £58.9m in 2010-11. Three could not provide figures.

It is estimated that jobs could be lost at 17 of those authorities, with Sutton Council expecting to shed 300 to 500 jobs by 2014, while Hammersmith and Fulham have cut 600 posts since 2007-08.

Meanwhile, a found Richmond upon Thames was the most resilient area to possible economic shocks - while Barking and Dagenham was the least resilient.

Resilience: Full Data

DownloadExperian resilience data - in full[645kb]

DownloadExperian methodology[41kb]

The research looked at overall resilience of London boroughs and their strengths in categories such as community, life expectancy and education.

Islington had the highest business resilience with firms operating in fewer vulnerable sectors.

Barking and Dagenham fared the worst because more businesses there were in vulnerable sectors and there were fewer jobs.

But on the positive side it had the second highest proportion of new businesses set up in London since 2008.

Richmond had the best community resilience with more high earners, few benefits claimants and high life expectancy rates.

Tower Hamlets fared the worst as it had the highest unemployment rate in England and widespread deprivation.

Camden, Hammersmith and Fulham, Richmond and Wandsworth were the top four in the people resilience list in England due to the high proportion of managers, people with NVQ4 or higher qualifications and large working age populations.

Barking and Dagenham scored poorly in these factors and also had a large population with no qualifications and low earnings.

Barking and Dagenham also came at the bottom of the London list for factors such as high crime rates, low school performance rates and more vacant or derelict land.

Politicians come face to face with the public to explain spending cuts in the London Debate on BBC One at 2235 BST on Thursday.

Then on Friday on BBC London 94.9, between 0900 BST and 1200 BST, Anne Diamond will discuss the issues raised in the London Debate.

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