Local government financial strategies amidst austerity, centralization, and risk

Abstract

Abstract Pursuing austerity following the 2008 crash, the UK government introduced unprecedented expenditure reductions and its localism and local financial self-sufficiency agenda. These national policies aimed to reduce local government’s dependence upon grants from the UK government and encourage local municipal entrepreneurship and innovation. Combined with rising local service demand, this UK government strategy intensified pressures on local statecrafters to close funding gaps by making savings and finding new income sources. Amidst fiscal stress and uncertainty, local government financial strategies moved unevenly towards more active and strategic risk management, challenging depictions of ‘councillors at the casino’ as partial explanations. Local statecrafters were forced to change their expenditure and income generation strategies. National governance and regulation of local financial resilience, sustainability, and failure are being tested as more local governments in England are pushed to brink of unbalanced budgets. Looking beyond the peaks of high-profile and novel activities and providing the hitherto missing overview across England since 2010, a differentiated landscape of local statecraft engagements with financialization is revealed, comprising vanguard, intermediate, and long-tail approaches amongst local governments.