Brexit ‘faffing’ will lead to a funding mess for local authorities, according to the leader of Reading Borough Council (RBC).

The council published its three-year budget plan last week, which has been deemed robust internally, but councillor Jo Lovelock has raised concern over the uncertainty of the outcomes of Brexit and forthcoming local government reform.

The government is currently undertaking a review of local government funding and consulting on business rates retention reform, to be introduced in 2020.

Councillor Jo Lovelock, leader of RBC, said: “We are supposed to be putting together a three-year budget but clearly that is subject to change.

“I regret that we are in a position where we have not got a clue what is happening at the end of this year.

“The government has been going on about local government funding for years.

“They will be so busy faffing about with Brexit that they will make a mess of local government funding.”

The government’s fair funding review will change the way that local authorities in England are funded, while business rates retention reform will see all councils keep 75 per cent of the tax from 2020/21.

Local authorities currently retain 50 per cent of business rates, although RBC is part of a national pilot project which has allowed it to keep 100 per cent in 2018/19 and 75 per cent next year.

The Local Government Association has warned about the growing risk to vital local services if councils are not adequately funded.

Core government funding to RBC will have been cut from £58m in 2010 to zero by next year.

RBC say demand for vital services such as protecting children in need and preventing homelessness is increasing at the same time.

The council’s budget papers, which will be discussed at full council on February 26, also warn about the impact Brexit could have on the council’s finances.

The report, from the director of resources, states: “Brexit has the potential to have a significant impact for both the UK’s economic future as well as the Council’s financial position.

“The Chancellor’s Autumn Budget set out the path for a ‘soft’ Brexit. If there is a ‘hard’ Brexit then there could be a further review of public spending with potential consequences for future government funding to local authorities.”

The government announced Brexit contingency funding earlier this month, with unitary councils like RBC to be given £210,000, spread over two years ‘to prepare for an orderly exit from the EU’.