If your childhood happened between the mid-1970s and early 80s, you will probably recall a particularly miserable symbol of that era’s reduced budgets and shrinking horizons: the broken-down, litter-strewn park.

Slides would be so caked in mud as to make them unusable; roundabouts wouldn’t go round; grass would go uncut. I grew up in suburban Cheshire, and even there, the same applied: in amid the fag ends, dog shit and broken bottles, a weird sense of times so topsy-turvy that places meant to deliver happiness had become a byword for a kind of low-level sadness. Is there a more forlorn sight than a broken swing?

Two weeks ago, I spoke to a mum and dad in Newcastle who were trying to entertain their toddler in a play area with a cracked slide, and talked about other places nearby now covered in graffiti, and rendered all but unusable. The national statistics show how widespread this almost silent crisis is becoming. At the last count, 86% of the people in charge of local parks had seen cuts to their budgets since 2010; and almost half of local councils were considering either selling their parks, or somehow contracting them out. All over the country, in fact, you now see much the same sight: perhaps the most vivid, immediate embodiment of what some people call the public realm, rotting away at speed – and now set to decline even further, as the Conservatives continue to strip money from councils’ budgets.

But as evidenced by the reaction to George Osborne’s autumn statement, in the dizzy heights of the London-based media, this is not how the world looks at all. “Whatever happened to austerity?” parped the front page of Thursday’s Daily Mail, while the Telegraph apparently announced that spending cuts had now finished (“The end of austerity”). The ever-thoughtful Sun ran a front-page illustration of three Osbornes lined up on a fruit machine, with the headline “Borne lucky” and a story announcing nothing less than a “£27bn jackpot”. To judge from the newsstands, the munificent bonanza facilitated by dodgy fiscal forecasts and headed up by the U-turn on tax credits had been perfectly timed to coincide with Christmas.

These are truly Orwellian times, but this recasting of want as plenty is particularly surreal. Over the next five years – and possibly for even longer than that – the kind of dire, drastic cuts councils have been forced to make since 2010 will be continuing. Indeed, the situation looks more impossible than ever. To quote one very reliable source: “Even if councils stop filling in potholes, maintaining parks, closed all children’s centres, libraries, museums, leisure centres and turned off every street light, they will not have saved enough money to plug the financial black hole they face by 2020.” Lord Porter said that. He’s the chair of the Local Government Association. He’s also a Tory.

The chancellor’s hopeless offers of assistance extend into the distance

Before the spending review, councils in England and Wales were anxiously modelling cuts to their spending of between 25% and 40%, and worrying about increases in demand for the services they have to provide as a matter of law, which are forecast to add £10bn to their costs by 2020. But between now and then, money that currently goes from central to local government will be cut by more than 50%. On Wednesday, almost no one seemed to notice this, not least in the House Of Commons. But while John McDonnell was quoting Chairman Mao, a lone note of alarm from Yvette Cooper – remember her? – drew attention to what was afoot. “Appears to be a 56% cut to Govt funding for local councils … did I miss that in Chancellor’s speech?” she tweeted.

Appears to be a 56% cut to Govt funding for local councils table 2.1 p78 AS - did I miss that in Chancellor's speech? #spendingreview — Yvette Cooper (@YvetteCooperMP) November 25, 2015

This huge cut will happen, but it is part of a bigger plan. Since 2013, with some caveats, councils have kept half of the money they get from business rates, and carried on putting the rest into a centrally administered pot. This is then spread around the country according to the current council-funding formula – whose iniquities are a big source of complaint among council leaders, but which at least represents some residual idea of redistribution, not least from south to north. Now, councils are to largely keep all their income from business rates, while the money passed to local authorities from central government will eventually be cut to nothing. How this will be phased in and what any redistributive element might look like is unclear, though it’s pretty obvious that a system of “top ups and tariffs” will be much less redistributive than the current system.

The danger, clearly, is that thriving places – London, to pick one obvious example – will be awash with funds, while other places struggle. Moreover, when the new system materialises, the money available in any area for basic services will not be decided according to need, but how well businesses are doing, and whether local politicians can attract more of them. To hear some Tories talk, unimpeachable neoliberal logic could then be brought to bear: if you cut your local business rates, money-hungry corporations might come swarming. There again, they might not – in which case, you’ll just have a lot less money. More to the point, can you imagine what this new system will mean when we collide with another recession? (By way of a grim kind of answer, Osborne has said that he will now let councils keep 100% of the proceeds from the sale of any assets, to be used as they fit. You never know: flogging off parks might be one option.)

The chancellor’s hopeless offers of assistance extend into the distance. He has also come up with the idea of allowing local politicians to somehow protect adult social care – for elderly people, as far as anyone understands it – by putting up council tax by up to 2%, and far too much of the media has fallen for the idea that this represents something credible. In Liverpool, the full 2% hike would raise £3.2m a year, but the city’s annual social care bill is £172m. Even the government’s plans to eventually give councils £1.5bn for social care via the so-called Better Care Fund woefully fail to meet the scale of a mounting problem. The research charity the Health Foundation reckons that Britain’s care gap will be £6bn by 2020; even if he is lucky, both of Osborne’s measures would barely scrape together half that sum.

Buried in the autumn statement, there was also an announcement that the government intends to completely cut the £2.6bn a year it gives to councils for public health spending (which covers areas such as drug and alcohol abuse, sexual health, and teenage pregnancy). The idea, apparently, is that the money can be made up thanks to all those business rates. The more likely outcome, of course, is that these things will fall into the same fragile category as libraries, parks, bus subsidies, welfare advice, help for homeless people, transport to school for children with special educational needs, and more: a great roll call of the basics of any halfway civilised society, either under threat, or disappearing fast.

This, then, is Osborne’s dystopia – where newspapers announce that two and two make five, wealth collides with public squalor, and the slides and swings stay broken. One question demands to be asked, which should be addressed to the supposed forces of opposition, as much as the government: how long can it last?