North Tyneside council budget is facing big cuts
PUBLIC WILL THEIR SAY ON PROPOSALS FOR SAVINGS
BE GIVEN
MILLIONS of pounds are set to be cut from North Tyneside Council’s budget next year.
It comes as the authority’s cabinet agreed the proposals for next year’s budget at a meeting this week.
The borough’s residents will now be invited to have their say on the proposals before they are decided on next year.
Council documents predict a funding shortfall of £6.370m for the coming year and around £56m over the next four years. This figure is before any increases to council tax rates.
Figures in the documents say the authority could save £1.792m by contractual changes – changing how it buys services and “income growth.”
Meanwhile, if it was to raise council tax by 3.99%, including 2% earmarked for adult social care, it could raise a further £4.006m.
The authority’s medium-term financial plan, approved by members in February, indicates a gap of £8.256m in the coming year and around £44m over a four-year period.
The report sets out an indication of the funds available through a general increase in council tax of 1.99% and a 2% adult social care precept.
Government guidance on this announced last week as part of the Spending Review proposed an adult social care precept of 3%.
As things stand, councils are barred by the Government from setting the basic council tax increase at more than 2%. If they want to increase bills further, they need to hold a referendum of local voters, which they would be almost certain to lose.
Chancellor Rishi Sunak has now told councils they can impose an additional 3% increase with the money ringfenced for social care without requiring a referendum. This means they can hike bills by 5% in total.
The authority says its budget proposals aim to support North Tyneside’s economic recovery, maintain and improve services and drive forward the council’s ambitions in the coming year, amidst continuing uncertainty.
Throughout the pandemic, the council has taken action to maintain vital services for residents and businesses, support the NHS and wider health system, protect vulnerable people and ensure the safety of staff.
As of September, the cost of Covid-19 to North Tyneside is estimated at £27.3m, including additional costs of £20.6m and £13.2m in lost income and estimated savings of £6.5m.
Government grants have covered £21.4m and left a shortfall of £5.8m.
A report to cabinet said many of the additional costs, lost income and undeliverable savings will have an extended impact on next year’s budget.
North Tyneside’s mayor Norma Redfearn says the authority will use all its experience of financial management during a decade of austerity to set a budget which reflects the priorities of residents and businesses.
She said: “This has been an incredibly difficult year and we know many of our residents and businesses have suffered greatly due to the pandemic.
“Council finances have also taken a significant hit as our spending has increased and our income has reduced, while the support from central Government has not covered all of our additional financial pressures, and demand has increased for services such as adult social care.
“We don’t know what the long-term economic impacts of the pandemic will be but, despite this unprecedented level of risk and uncertainty, we will continue to plan for the future, listening and focusing on the priorities of residents and businesses to come up with a fair and balanced budget for 2021/2022.
“Despite the unknowns, our residents and businesses can be sure the authority will continue to deliver and improve the services which meet their needs and provide good value for money, while also supporting our most vulnerable residents.”