Town halls ‘may struggle to cope’ after losing £3bn

Londoners must prepare for "profound" cuts in council services — from libraries to unfilled potholes — after George Osborne slashed

The fall in Whitehall grants to London's 33 councils will amount to just over £400 for every person in the capital by 2014.

They are so deep and sudden — amounting to at least 26 per cent in total — that some councils may quickly find that they are unable to cope, according to a local government expert.

Iain Hasdell, head of local and regional government at consultants KPMG, said that the last time local government finance was shaken up in the early Nineties "a number of councils got into difficulties very quickly".

Tens of thousands of jobs will also have to go with estimates of the shake-out in the capital ranging from 25,000 to 60,000.

Councils with the smallest cushions against the Osborne squeeze are Brent (reserves equivalent to 11 per cent of annual revenue expenditure), Barking & Dagenham (12.4 per cent), Harrow (12.9 per cent) and Hillingdon (13.7 per cent).

Mr Hasdell said: "Will our street lights work, will the grass be cut, will gritting be done, will the play equipment be maintained over the next four years in the same way that has been in the past? Probably not."