An LGA White Paper produced ahead of the General Election shows the deficit is being driven by rising cost and demand pressures to provide adult social care, children's services, homelessness support and home-to-school transport for children with special educational needs and disabilities.

Cllr Kevin Bentley, senior vice chairman of the LGA, warned a ‘chasm will continue to grow between what people and their communities need and want from their councils and what councils can deliver'.

The LGA is calling on all political parties to commit to a significant and sustained increase in funding for councils in the next Spending Review, alongside multi-year funding settlements for councils and plans to reform the local government finance system.

The White Paper calls on the next government to urgently commission a major review of public service reform to understand how all public services can work together within their local communities, focusing on a joint approach to investing in more preventative services for people in need and reducing demands on current costly and high need services such as adult and children's social care.

In addition, the LGA has set out how councils can play a vital leading role in unlocking labour markets by devolving powers to run local skills and employment schemes, ending fragmented, short-term growth funding pots and backing local climate action.

Other proposals include:

• giving councils and combined authorities the powers to build more affordable, good quality homes at scale for people in the areas where they are needed, with five-year local housing deals for all areas of the country that want them, combining funding from multiple housing programmes into a single pot
•          a renewed focus on prevention, including immediate implementation of the Hewitt report recommendation that at least 1% of NHS spend is invested into preventative services over the next five years, ensuring councils can provide the right support for people at the right time
•       reforming adult social care, ensuring it is adequately funded, with councils and the NHS working better together to support people in need, and a focus on prevention and recovery services, including support for the voluntary sector who are a crucial part of the adult social care system
•         reviewing early years education and childcare to ensure that the workforce has the right skills and training and ensuring early years entitlements are properly funded, with councils fully resourced to deliver their statutory duties
•         building a stronger partnership between councils, the NHS and schools, backed by new powers and a separate ‘inclusion' judgement in the Ofsted school inspection framework, that meets the needs of children and young people with SEND and enables more children to remain in mainstream schools.