Inflationary pressures to cause ‘yet another financial precipice’
THE FINANCIAL effect of the covid pandemic is being felt by Wokingham Borough Council, and will lead to the council facing “yet another financial precipice”.
This includes “significant inflationary pressures impacting on our services and Capital programme ambitions, these include gas prices and the huge increase in cost of building materials”.
Council leader John Halsall told a meeting of its Executive committee on Thursday, September 30, that another pressure on them was “a potential multi-millionpound burden, following the recent NHS and Social Care announcements”.
Cllr Halsall said that as a result of the pandemic, its recovery strategy and expected commitments, the council is “reviewing our revenue income and expenditure, and our capital budget, particularly if unsupported [by the government]”.
He added: “Many of these pressures are already upon us, and others will be taking their toll over the coming years.
“We cannot afford to take our hands off the financial tiller and must continue to collectively steer our way through turbulent and challenging times.”
In coming weeks, Wokingham Borough Council will learn what its grant from the Government will be for the 2022-23 financial year.
This, Cllr Halsall said, would be “one of the most significant Local Government Finance Settlements this Council has faced in a very long time”.
“It will determine the grant funding we have to deal with our challenges over, I suspect, the next three years,” he said.
“It is essential we get a fair deal for this Council and our residents. I and my Executive will do everything in our power to press home the case for Wokingham. I am just grateful that my contact with Government and MPs is very good.
“Regrettably, I cannot determine the outcome of such a national funding settlement. So, whilst doing all I can to bring pressure to bear to get the funding settlement our residents deserve, it remains incumbent on us to relentlessly pursue value for money in all we do and continue to practice the highest standards of financial management in delivering vital services for our community.
“Therefore, we are reviewing our revenue income and expenditure, and our capital budget, particularly if unsupported.”
Speaking after the meeting, he said that as a local authority, Wokingham had to live within its means. “If the paradigms which we have here are thought to be about to change, then we must change what we’re doing,” he said. “We are not going to become the next Slough.”
He likened the situation to like driving a car, in that motorists adapt to the prevailing conditions.
“I don’t know if these will be temporary, instantaneous or medium term. My belief is that we’re currently in a period of overheating and we have supply-side problems which has nothing to do with Brexit. It is to do with the fact that the economy was stopped for the best part of 18 months, and the recovery is a lot stronger than anybody expected.
“The supply side issues are fuel, energy prices, materials, building costs and building availability, all of which nobody expected. And furlough has now ended; we don’t know what that’s going to do yet.
“However, we are a really good local authority whose finances are strong. This correction might not be a correction, it might just be a check that we are still on the right track.”
He added: “Reviewing the budget in the light of a change of circumstances doesn’t mean that it’s a crisis or an emergency, it means that you’re reviewing the budget in the light of the changing circumstances.”