Hard-pressed local authorities throughout London are facing a massive £2bn budgetary black hole as a result of continuing cuts to council funding, according to a new report.

As part of its submission ahead of this year’s Autumn Statement, London Councils, which represents all 32 boroughs and the City of London, has warned current funding levels are unsustainable and that boroughs in the capital face the biggest reduction in “core spending power” of all regions.

Some boroughs are already spending more than 70 per cent of their budgets on social care, and larger than average population growth across all age groups is set to place noticeably bigger demands on them to deliver children’s services and school places, as well as health and social care for the elderly and those with physical and learning disabilities.

Bexley Council has warned of another £5m in cuts on top of the £6m it has already saved.

The authority is already looking at plans to merge adoption services with Kent and Medway as the spending squeeze continues.

However, unless more savings are found the council faces a £15m funding gap by 2017-18 which will rise to £32m by 2021-2022 unless urgent action is taken.

In Croydon, plans to hand over adult education services to the private sector have been put on hold after council officials realised the move would lead to a more than half a million pound budget shortfall.

And Harrow Council, which will have £83m less to spend in 2018 compared to 2014, is planning to scrap smoking cessation services as part of its savings plan next year.

Cllr Claire Kober, chairwoman of London Councils, said: “The current four-year funding settlement for London does not take into account large levels of population growth – meaning it’s even tougher on boroughs than it first appears.

“Even with the assumption that all boroughs will raise council tax, which is unlikely, the scale of these funding cuts coupled with inflation and a rise in demand for services means London will be facing a funding gap of £2bn in 2020.

“Local government must be given the tools to meet rising demand for services and it is vital that stable and sustainable funding models are put in place to allow our city to grow enough to meet these demands. We hope to see something which will reflect this in the Autumn Statement.

“With boroughs already spending huge chunks of their budget on social care, it is clear many will be unable to continue to provide the public services they currently offer.

“Government has a responsibility to ensure local councils are not left to deal with these huge rising pressures alone with funding settlements which simply don’t add up.”