The current system of local government finance is unsustainable, according to Paul Johnson, director of the Institute for Fiscal Studies.
Writing in The Times, Johnson said that this has already been proved by a series of bail-outs by the government to prop up social services.
He said: “That’s no way to run things in the longer term, although continuing to muddle through by topping up spending with additional ring-fenced grants is probably the short-run default.
“Eventually, we will need to make a choice: more central funding and a genuinely national set of standards, or more devolution of tax-raising powers and more acceptance of local variation.
“Either local councils will need more tax-raising powers of their own, perhaps from a local income tax, or central government will have to find those revenues from central funds.”
