By Adam Coleman

New research in the UK has suggested that the financial crisis is placing pressure on local government’s ability to deliver services.

Economic uncertainty and a rise in unemployment is leading to more people experiencing mental health problems and struggling to find housing, according to a survey by the Local Government Association, the Improvement and Development Agency and SOLACE.

The survey also revealed that as the economic downturn hits the UK, people are looking to local authorities and public services to help them through difficult financial times.

Councils reported an increase in people requiring housing benefits and a fall in development applications and large-scale construction projects due to a drop in developer finances.

Local Government Association chairman, Cr Margaret Eaton said the research highlights the extent to which local authorities are being affected.

“From a rise in homelessness to an increase in mental health problems, councils are reporting a huge uptake in their services,” she said.

Cllr Eaton said the research uncovered the extent to which people and businesses are feeling the effects.

“At this time of repossessions and redundancies, even more people need the vital support that only councils can provide.”

Cr Eaton said problems in the construction industry are evident from statistics that reveal a nosedive in planning applications and large-scale building projects.

“Development projects both in and out of town centres, have stalled as developers struggle to raise the finance needed,” she said.

“Many people just wouldn’t realise that their local council can provide them with a whole range of ways of keeping household costs down. From giving people allotments to grow their own fruit and veg to helping people to keep energy bills down through insulation and free efficient light bulbs, town halls will be able to give hard pressed residents a helping hand."

According to the survey, councils in the UK are predicting a rise in:

• People applying for housing benefit in nine out of 10 council areas
• Homelessness in eight out of 10  council areas
• Demand for free school meals in two out of five council areas
• Mental health problems in two out of five council areas
• Debt advice in nine out of 10 council areas
• Businesses asking for support in three out of four council areas

For a a free copy of the report click here.