Children’s wellbeing is at risk because of a “miserable” council funding crisis that leaves North East authorities needing to cut almost £200m of public spending by 2027.

Experts have warned that services for the most vulnerable are bearing the brunt of a “really desperate situation” in which councils across the UK face a combined deficit of more than £5.7bn, according to analysis of town hall finances by the BBC.

Data shows that the seven local authorities in Tyne and Wear, Northumberland and County Durham have approved almost £73m worth of savings in the current financial year, while also spending £53.8m of their reserves, but face a shortfall totalling £195.9m by 2026/27.

The Local Government Information Unit (LGIU) cautioned that councils had already carried out cuts to the “easy stuff” years ago, amid massive budget reductions since 2010, and warned the results will now be people receiving fewer hours of care and support being reduced for children with special educational needs and disabilities (SEND).

Its chief executive, Dr Jonathan Carr-West, said the bleak financial picture had been compounded by the growing demand for, and the increasing cost of, services to look after an ageing population and people with complex needs.

Children’s Commissioner Dame Rachel de Souza added that many of the cuts imposed by local authorities will “disproportionately impact children who rely on the state for protection and a stable home environment”, while Barnardo’s chief executive Lynn Perry warned that they risked a “lifetime cost for a generation of children.”  

Durham’s £45.4m is the largest projected shortfall by 2026/7 in the North East, followed by Newcastle City Council on £38.2m and Northumberland’s £30.9m.

Gateshead Council is predicting a £27.5m deficit over that time, Sunderland £27.1m, North Tyneside Council £22.1m and South Tyneside £4.8m, according to the BBC’s Shared Data Unit.

Newcastle City Council finance chief Mark Nicholson warned recently that meeting the needs of an increasing number of SEND children was the “single biggest financial challenge we have”, with the city predicting an £8.1m overspend on educational support for SEND pupils this year.

The council, which has slashed its overall budget by £369m since 2010, also recently consulted on budget-cutting plans that could see it scrap free home to school transport for all post-16 learners in Newcastle.

Its newly-elected leader, Karen Kilgour, told the Local Democracy Service this week that she would be lobbying the Labour government for “fairer” funding for the city and for longer-term grants that would offer councils far greater certainty in their financial planning.

She said: “We have had 14 years of austerity and that has had a massive impact, it would be ridiculous to pretend otherwise. But we have had really good, prudent financial management in this city and we are in a much stronger position than some of our peers are.”

According to the BBC, Leeds Council’s £152.4m is the biggest predicted council deficit in the country.

Durham County Council recently reported that it has a predicted £64.1m shortfall over the next four years, which is higher than expected due to growing pressures, primarily in children’s social care and home to school transport.

Amanda Hopgood, the Lib Dem leader of the county’s coalition administration, said in September that there appeared to be “little cause for optimism at this stage that we will see the increases in funding that we desperately need based on all the noises that are coming out of the new government so far”.

She added: “This council cannot be left in limbo and urgent action is required to address the urgent, immediate pressures.”

Louise Gittins, chair of the Local Government Association (LGA), warned that the risk of financial failure across local government is “becoming systematic”, with the likes of Birmingham and Nottingham having already declared effective bankruptcy, as she joined calls for the new Government to provide councils with financial stability and funding reform, including the introduction of multi-year funding settlements.

Labour’s local government minister, Jim McMahon, said: “This government inherited a crisis in local government and there’s no shying away from the scale.

“These deep-rooted problems won’t be fixed overnight, but we are committed to fixing the foundations, reforming and rebuilding the sector from the ground up to begin to get ahead of the underlying pressures for the benefit of councils and local communities.”