City faces raiding its reserves to spend on essentials
CASH-STRAPPED LEEDS City Council may have to dip into its reserves in order to pay for essential services over the next few years, a meeting has heard.
The council’s Strategy and Resources scrutiny board met on Monday to hear the latest on the West Yorkshire local authority’s medium-term financial strategy, which looks at what the council expects to spend over the next three years.
A report published back in June said that for the period covered by the financial strategy there is an estimated overall budget gap of £96.8m.
The report read: “The scale of the funding gap between 2019/20 and 2021/22 is projected to be in the order of £13.8m, £52m and £31m respectively in each financial year.
“For the period covered by the financial strategy there is an estimated overall budget gap of £96.8m.”
This year, Leeds City Council’s Government grant has been cut by 28 per cent to £18.5m, adding to the £239m already cut since 2010.
The authority’s deputy leader James Lewis told the meeting: “(The report) is the first step in setting our revenue budget for 2019-20 and predicts the resources available for councils in the years ahead.
“It’s fair to say the further away we get from the current time, the more speculative it gets.
“We don’t have a crystal ball to predict things.”
Committee chair Coun Pauleen Grahame said: “Brexit can affect council’s reserves – this is an issue that we should be looking at.”
A council officer told the panel: “We are assuming that we will use reserves that will take the level down to just over £20m.
“That would probably be pretty close to (the minimum) – if we went below that we should be worrying.”
Another officer added: “We rely on tight financial management to make sure we don’t get into trouble.”