Leicester Faces Economic and Social Strains Ahead of Crucial Budget
Leicester is confronting significant economic and social challenges as it prepares for a pivotal budget announcement on 26 November. The city has the lowest UK Gross Disposable Household Income (GDHI) per head at £16,067 in 2023, starkly contrasted with London's £35,361 and the City of London's £129,429. This discrepancy is partly attributed to outdated 1972 boundaries that exclude wealthier suburbs from Leicester's GDHI calculations.
Approximately 20% of Leicester's population lives in deprived circumstances, double the national average. Despite near full employment, many residents contend with low wages and minimal household wealth. Persistent energy costs and housing pressures exacerbate hardships; Ofgem-linked energy debt reached around £4.5 billion in the first half of the year. Leicester Council operates a funded unit focused on easing energy bills and addressing health issues related to poor heating and housing conditions.
Housing strain is severe, with the Zinthiya Trust reporting instances of up to four families sharing one home. The trust also manages 18 emergency rooms across Leicester to support abuse victims who have become homeless. Leicester's industrial base has diminished following the decline of the textile industry. The city currently depends on thousands of small and medium-sized enterprises, with major employers such as Samworth Group, which employs over 5,000 people.
Mayor Peter Soulsby highlights austerity-era funding cuts and the obsolete GDHI boundary as reasons for Leicester's low spending power. He is actively seeking to reclaim funds lost during austerity. The forthcoming budget is anticipated to focus on addressing the cost-of-living pressures, with reported plans including measures to curb rail fare increases, lift the two-child cap on benefits, expand free school meals, and protect investment in infrastructure. Notably, rail upgrades to the East Midlands line are part of the proposed improvements.
