Councillors will this evening meet to discuss the council’s £840 million budget and how the money will be spent in the next financial year.
10 senior councillors who sit on the Policy & Resources committee will debate how and where the budget will be allocated and the key services to be invested in, with the final decisions being made by all 54 councillors at Full Budget Council on Thursday 23 February.
The latest situation
This budget is one of the most difficult the council has ever faced with a projected shortfall in 2023/24 of £14.m with further projected shortfalls of £44m over the following 3 years, fuelled by demand for our services, very high inflation, the ongoing impact of the pandemic and the cost-of-living crisis.
This is also the 14th year in a row the council has had to address a real terms government cut to its budget, totalling more than £110 million since 2010.
The council spends £2.3 million a day delivering hundreds of services including adult social care, children’s service, housing, transport, parks and open spaces, libraries, and residential waste and street cleaning.
Every part of the organisation was told to look very closely at the services they provide and to save money where possible.
Managers also had to carry out what are called Equality Impact Assessments (EIA) to evidence the potential effect on service users and how best we can lessen any impact.
More money for essential services
As well as savings there are also many areas that will receive investment totalling more than £30 million to ensure essential services are provided to the highest standard possible. These include new investment in:
- Council housing and temporary accommodation
- Meeting increasing Children in Care costs, supporting Unaccompanied Asylum-Seeking Children, increased demand for Home to School Transport and increased caseloads on children’s court related work
- Meeting inflation and increased demand for various Adult Social Care, including Adult Learning Disability services, home care services and mental health
- Increased maintenance and cleaning costs of public toilets and for the future delivery of the service
- Refuse and recycling services, maintaining and upkeeping the city’s parks and open spaces and managing Elm disease and Ash dieback
- Sport and leisure facilities, including funding for increased energy costs and Active Travel measures to enhance public health and air quality
How we’ve reduced the shortfall as much as possible
It was initially thought the funding gap next year could be almost £21 million after our government grant was announced. This could have led to services like public toilets and some council-run nurseries being closed.
However, as our finance officers continually review our finances throughout the year, changes have taken place which have allowed us to reduce the shortfall by almost £7 million. These are included in the committee report.
The report also includes a proposal to increase general council tax by 2.99% plus 2% solely for adult social care to provide services to vulnerable, disabled and frail older people.
Why the council faces a £14 million shortfall
Below shows how much extra income the council will receive for 2023/24 against the extra spending it faces.
Total increase in the council’s costs for 2023/24
- Inflation, the general increase in prices - £28 million
- Growth in demand for services - £15 million
Total extra council funding and taxation for 2023/24
- From government grants, council tax increases and retained business rates - £29 million
- Extra spending totals £43 million; extra funding and taxation £29 million; therefore the shortfall is £14 million.
The public can now see a committee report on the extremely difficult decisions councillors must make when they begin considering the proposals this evening.
Council leader Phélim Mac Cafferty has already warned that ‘only difficult decisions remain on the budget’.
Councillor Mac Cafferty said: “"Over the next two weeks, councillors will decide how we will spend our budget, under some of the challenging circumstances we've faced as a city.
“We have invested more than £30 million in key services but very sadly have had to take extremely tough decisions on other areas of spending.”
He added: “This is one of the most difficult budgets the council has faced in my twelve years as a councillor and we’re doing everything we can to protect vital council services.
“We’ve been honest with the city by discussing the tough decisions and the complexity of the problems we face with our valued staff and trade unions, residents, partners, businesses and the city councillors from the other parties.”