Councillor Peter Box, the leader of Wakefield Council, said other authorities could follow in the footsteps of Northamptonshire County Council, which is in the grips of a cash crisis.
In July, the troubled council issued a notice confining spending to “only the most essential services” amid fears its budget shortfall could reach £70m this year.
Coun Box said: “Northamptonshire should be a stark warning to Government. If that authority can go under so can others and what is going to happen then? I think what Government has to do is invest in local people and to do that have to invest in local government.”
His warning comes two months after Local Government Association (LGA) estimates predicted that councils in England would face a funding gap of £7.8bn by 2025.
The body said the Government’s next spending review would be “make or break” for the local councils. “Councils are really facing a cliff edge,” Coun Richard Watts, chair of the LGA’s Resources Board, has now told The Yorkshire Post.
He said more money needs to be put into the system or “councils will be put in impossible positions and more will go to the wall”.
The Ministry of Housing, Communities and Local Government said its funding settlement gave a “real terms increase in resources for local government in 2018-19” and it was providing councils with £90.7bn to help them meet the needs of residents.
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