‘It’s as bad as it gets’
PLANS FOR CITY COUNCIL TAX RISE AND ‘SAVAGE’ CUTS TO SERVICES
COUNCIL tax in Leicester is set to rise by the highest amount it can in 2022 without needing a referendum - with some households having to pay up to £101 more a year.
Of that, 1 per cent will go to meeting rising adult social care costs, which are predicted to increase by £17.5 million next year and by £42 million in 2023/24.
Mark Noble, director of finance for Leicester City Council, said: “The costs [of adult social care] are growing and growing and we’re just not getting sufficient government funding or anything like it to deal with it.
“I would go so far as to say it’s threatening our entire budget stability.
“We are being told we can increase council tax by an additional 1 per cent.
“Every authority in the country can increase council tax by 2 per cent without requiring a referendum and social care authorities can do 3 per cent. That will give us another £1.3 million, which comes nowhere close to meeting those costs of £17 million or £42 million.”
For a band B property, the most common band in Leicester, the city council’s portion of the council tax charge is expected to rise from £1,318.27 in 2021/22 to £1,357.80 in 2022/23. This equates to an increase of 76p a week.
Band H property residents will see their bills rise by £1.95 a week.
City mayor Sir Peter Soulsby said huge savings will also need to be made to bridge the funding gap.
He said: “We are continuing to face the prospect of very real, savage cuts in our spending and therefore very real savage cuts in the services we provide.
“We have been very successful in the way we have managed our budgets in recent years. Nonetheless we have already had to cut in real terms about £150 million a year of our spending over the past ten years, but the prospect is having to cut a further £40 million over the next couple of years.
“What we haven’t got yet is a list of specific proposals because frankly none of it looks pain-free. It is something that is as bad as it gets. I cannot say for definite that making savings of £40 million is achievable.”
Mr Noble added: “We’ve run a policy of trying to save our money in reserves so we can manage bad times when they come and not have to resort to crisis cuts when we hit problems. In 2021/22, we couldn’t make savings because it was impossible in the pandemic. So we used £17 million of reserves to balance that year.
“We’re balancing the budget in 2022/23 again by using £30 million of reserves, but we are facing a very, very severe cliff edge in 2023.
“We will take decisions as and when, we won’t leave them for 12 months and make them with the next budget. We’ll take them when we know we can do them to take the savings as quickly as possible and then that will help prop up reserves.”
In 2023/24, costs are expected to exceed available funding by £60.6 million. Currently, the council has £52 million in its reserves.
The city council has said these figures are broad estimates as the government is yet to announce the funding each authority will receive next year. This includes a share of the £1.4 billion being set aside for local authorities. Of this, the city council has estimated it will receive around £9 million.
The draft budget will be voted on at a full council meeting in February.
Leicestershire County Council also announced a probable 3 per cent rise in their portion of the county’s council tax last week.