The NAO's report titled 'Local Government Financial Stability' warns that council finances are becoming increasingly unsustainable and stresses the need for a comprehensive reform plan to address these financial pressures.

Local council representatives, including Pete Marland from the Local Government Association, are calling for urgent government reforms to funding that would enable councils to provide essential services and support their growth agendas.

Tim Oliver, chair of the County Councils Network, pointed out that specific cost pressures, particularly in adult social care and children's services, are significantly driving up council costs.

The rising demand for essential services, such as adult and child social care, has outpaced available funding, making access to these local services increasingly difficult.

There is a strong push for the Ministry of Housing, Communities, and Local Government to work with the Treasury to enhance preventative programs that could alleviate pressure on essential services.

In response to these challenges, a spokesperson from the Ministry for Housing, Communities and Local Government acknowledged the financial difficulties councils face and outlined plans for reform, including a £69 billion budget allocation.

Marland emphasized that inadequate funding has dire consequences for those reliant on council services, highlighting the critical need for a sustainable funding system.

Despite a 4% increase in overall funding for councils over the past decade, individual funding per person has decreased by 1% since 2015, even as demand for services has surged.

Gareth Davies, head of the National Audit Office (NAO), criticized the government's reliance on short-term solutions, advocating for a systemic approach to ensure the financial sustainability of local governments.

Sir Geoffrey Clifton-Brown, chair of the Commons Public Accounts Committee, criticized the current financial support as merely a temporary fix and called for improved accountability in local government finances.

Oliver further noted that the financial challenges councils face are primarily driven by specific market-related pressures in social care rather than general deprivation.